Challenges and strategies for sustainability of small and medium enterpreneurship in Armenia
2008
Karapetyan, A.
Taking into account the importance of Small and Medium Entrepreneurship performance for the country's economy as a whole, and the sector's significant contribution to GDP (Gross Domestic Product) in particular, we tried to elucidate the main challenges faced by and strategies formed for the sector's sustainable development. Firstly, we developed the idea of transition challenges which, one way or another, influence the sector's rapid development. Secondly, we stressed the main obstacles to development, mainly focusing on the limited access to bank finance and lack of foreign investments, problems in obtaining investment/capital, banking and financial institutions' strict policy on the one hand, and restricted and confusing tax policy or other legislative aspects, which have their direct impact on the growth of SMEs, on the other. Armenian SMEs play a crucial role especially for rural development, where the poor state of the existing infrastructure inhibits entrepreneurs from initiating or further developing business ventures in rural areas and discourages farmers from commercializing their operations. In addition, this has become a chronic problem for the rural areas which produce lots of opportunities for SMEs' sustainable and rapid growth. The paper discusses all possible strategies and statements which aim at determining gradual solutions for the sector's existing problems.
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