Strategies of the Development of Entrepreneurship and SME
Strategies of the Development of Entrepreneurship and SME
Strategies of the Development of Entrepreneurship and SME
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5 million was provided by UNDP <strong>and</strong> AMD 7 million was allocated for implementation <strong>of</strong> <strong>the</strong>Project in 2 regions <strong>of</strong> Armenia (Gegharkunik <strong>and</strong> Tavush marzes) by UK DFID. According toobtained preliminary arrangements during 2007 <strong>the</strong> ''top capital'' has a tendency to increaseabout twice.In scope <strong>of</strong> <strong>the</strong> Project for Support <strong>of</strong> Start-Up Businesses in 2006 financial supportamounted for AMD 5 million was provided by ACBA Credit Agricol bank to 6 start-upbusinesses. 335.2.5. Tasks for improvement <strong>and</strong> fur<strong>the</strong>r development <strong>of</strong> <strong>the</strong> <strong>SME</strong> sectorSo far we were talking about “evidential” achievements <strong>of</strong> <strong>the</strong> <strong>SME</strong> state policy. But <strong>the</strong>re is nodoubt that <strong>the</strong> real achievements <strong>of</strong> <strong>the</strong> State consider to positive changes from <strong>the</strong> <strong>SME</strong>’s <strong>and</strong>macroeconomic point <strong>of</strong> view. The question is not only support to <strong>SME</strong>s, but also to discovernecessary changes in <strong>SME</strong>s via support <strong>and</strong> development programs. It means that <strong>the</strong> realachievements <strong>of</strong> <strong>the</strong> main instruments for <strong>SME</strong> state policy, which are <strong>SME</strong> state supportannual programs should be mostly connected with <strong>the</strong> positive changes in behavior <strong>of</strong> <strong>SME</strong>s<strong>and</strong> overall social-economic situation <strong>of</strong> <strong>the</strong> country. Trying to explain <strong>the</strong> raised argument itshould be implied that <strong>the</strong> agenda <strong>of</strong> building strong basis for <strong>SME</strong> state support is still notcomplete in <strong>the</strong> country especially in light with identifying principal tools to overcome number<strong>of</strong> problems, which still hinder sustainable development <strong>of</strong> <strong>SME</strong> sector 34 . Moreover, among <strong>the</strong>several pressing challenges <strong>the</strong> overarching one is that <strong>of</strong> tackling financial <strong>and</strong> technicalobstacles <strong>of</strong> <strong>SME</strong> sector via more efficient measures in order to sustain stability <strong>and</strong> continuouslogicality <strong>of</strong> <strong>the</strong> programs. To this concern it should be mentioned that <strong>the</strong> results <strong>of</strong> <strong>the</strong>programs are not appraised in mature ways. 35 The monitoring <strong>of</strong> <strong>the</strong> programs only indicates<strong>the</strong> number <strong>of</strong> <strong>SME</strong>s receiving state support <strong>and</strong> <strong>the</strong>ir regional <strong>and</strong> sectoral distribution as well,which is not sufficient for identifying real results <strong>of</strong> <strong>the</strong> programs. Having into consideration <strong>the</strong>fact that above-mentioned programs are <strong>the</strong> main policy tools <strong>of</strong> state policy, <strong>the</strong>re is no doubtthat <strong>the</strong> only mechanism “to measure” <strong>the</strong> productivity <strong>of</strong> state policy is <strong>the</strong> introduction <strong>of</strong>solid granting system for program results connected to <strong>the</strong> goals <strong>and</strong> opportunities <strong>of</strong> <strong>SME</strong>state support. Application <strong>of</strong> a robust granting practice for <strong>SME</strong> state support annual programswill assuredly create new opportunities for provision <strong>of</strong> “on dem<strong>and</strong>” support to <strong>SME</strong>s, which inturn will path a way to more efficiently utilize <strong>the</strong> potential <strong>of</strong> <strong>SME</strong> sector in light with <strong>the</strong>social-economic development <strong>of</strong> <strong>the</strong> country. It will also record <strong>the</strong> real effectiveness <strong>of</strong> <strong>the</strong>state incentive without distorting <strong>the</strong> market self-regulation system.The long-term objectives should be set on development <strong>and</strong> support <strong>of</strong> <strong>SME</strong> sector toallow this sector to function in such a way that it contributes to improving <strong>the</strong> performance <strong>of</strong><strong>the</strong> national economy <strong>and</strong> its competitiveness, to reducing unemployment <strong>and</strong> regional, social<strong>and</strong> economic differences as key requisites for economic development <strong>of</strong> society. For achievingthis goal sustainable steps should be implemented towards streng<strong>the</strong>ning <strong>and</strong> expansion <strong>of</strong> <strong>the</strong><strong>SME</strong> support infrastructure in <strong>the</strong> country. Each endeavor towards <strong>SME</strong> development should bedone mutually including all <strong>the</strong> interested parties.33 “Report on Activities <strong>of</strong> <strong>SME</strong> DNC <strong>of</strong> Armenia, page 1934 Along with tendency for development <strong>of</strong> this sector as a result <strong>of</strong> surveys <strong>and</strong> administrative monitoring severalproblems revealed that <strong>SME</strong>s still encounter dealing with financing, tax <strong>and</strong> custom administration, difficulties forobtaining up-to date information, counseling <strong>and</strong> training support etc.The programs have being elaborated <strong>and</strong> monitored by <strong>the</strong> Ministry <strong>of</strong> Trade <strong>and</strong> Economic <strong>Development</strong> <strong>of</strong> <strong>the</strong>Republic <strong>of</strong> Armenia. The monitoring <strong>of</strong> <strong>the</strong>se programs occurs on a monthly, quarterly, semester <strong>and</strong> annual basis in<strong>the</strong> result <strong>of</strong> reporting by <strong>the</strong> <strong>SME</strong> DNC <strong>of</strong> Armenia.35 The programs have being elaborated <strong>and</strong> monitored by <strong>the</strong> Ministry <strong>of</strong> Trade <strong>and</strong> Economic <strong>Development</strong> <strong>of</strong> <strong>the</strong>Republic <strong>of</strong> Armenia. The monitoring <strong>of</strong> <strong>the</strong>se programs occurs on a monthly, quarterly, semester <strong>and</strong> annual basis in<strong>the</strong> result <strong>of</strong> reporting by <strong>the</strong> <strong>SME</strong> DNC <strong>of</strong> Armenia.96