1. General Orientations
The Policy Forum aims to identify those factors that
will improve the economic and legal environment for the growth of
the small and medium sized enterprise ("SME") sector in Bulgaria.
The forum has brought together some of the country’s most
influential individuals, representing various institutional and
independent bodies, to discuss the constraints that are hindering
the development of the SME sector and to propose and review various
recommendations to overcome these obstacles.
The paper attached hereto is a compilation of those
recommendations contributed and discussed at the forum. By
preparing recommendations in advance of forum meetings based on the
topics to be discussed, participants were able to provide a greater
number of feasible recommendations for the development of the SME
sector. In addition, by discussing the recommendations in an open
forum setting, immediate feedback was provided for proposals and it
also created wide support and acceptance of the report.
2. The Background Paper
The background paper is broken into three main
sections. Section 1 discusses the actions needed to improve the
economic climate to support the SME sector. Section 2 discusses the
actions needed to improve the institutional and legal environment
for SMEs. Section 3 describes a monitoring system to determine
whether or not the proposed actions from Sections 1 and 2 have been
implemented with the desired results obtained. Each section is
further divided into ACTION LINES. BACKGROUND information is given
under each Action Line followed by its OBJECTIVES. Then, specific
ACTIONS are described to achieve the objectives of the Action
3. The Importance of the SME Sector
The success of Bulgaria’s SME sector is essential to
the development of the economy as a whole. Foremost, SMEs are labor
intensive and capable of creating many new jobs at low costs. These
jobs will be necessary to absorb new unemployment created by
restructuring former State Owned Enterprises ("SOEs"). Among other
important SME contributions to the economy are:
- SMEs service the needs of larger corporations and
provide services that facilitate business. One role that SMEs can
play is as suppliers to larger companies thus contributing to the
external competitiveness of these firms.
- SMEs are a source of innovation on the basis that
they are more flexible, more dynamic and more sensitive to shifts
in demand than larger firms.
- SMEs contribute as "Seed-Beds" from which large
companies can grow.
- SMEs will provide an additional market for the
purchase of second-hand equipment from SOEs.
- SMEs train entrepreneurs needed to develop the
private sector and foster private investment.
As a result of these factors, the larger and more
developed the SME sector, the greater the SME contribution to the
growth of the economy.
Therefore, it is imperative that during this time of
concern, that the Bulgarian authorities take into consideration the
role of SMEs in the economic development of the country.
The product of this policy forum will provide a
guideline for officials to adhere to when developing the overall
plan for the country so that the proper recognition of the
important role of SMEs in the development of the Bulgarian economy
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