SME Policy Index: Eastern Partner Countries 2020

Assessing the Implementation of the Small Business Act for Europe

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The SME Policy Index: Eastern Partner Countries 2020 – Assessing the Implementation of the Small Business Act for Europe is a unique benchmarking tool to assess and monitor progress in the design and implementation of SME policies against EU and international best practice. It is structured around the ten principles of the Small Business Act for Europe (SBA), which provide a wide range of pro-enterprise measures to guide the design and implementation of SME policies. This report marks the third edition in this series, following assessments in 2012 and 2016. It provides a comprehensive overview of the state of play in the implementation of the ten SBA principles, and monitors progress made since 2016. It also identifies remaining challenges affecting SMEs in the Eastern Partnership (EaP) countries and provides recommendations to address them based on EU and international good practice examples. The 2020 edition also features a novelty: An assessment of three new dimensions going beyond core SME policy (competition, contract enforcement and business integrity) looking at key structural reform priorities that are critical to establishing a level playing field for enterprises of all sizes and ownership types.

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Azerbaijan: Small Business Act country profile

Following a global drop in commodity prices, Azerbaijan underwent a sharp recession in 2015-16. As part of its response to the downturn, the government launched an ambitious plan to implement reforms in 12 strategic sectors, including the SME sector, with the objective of diversifying the economy and improving the business environment. Under the umbrella of the “Strategic Roadmap for the Production of Consumer Goods at the Level of Small and Medium Entrepreneurship”, the main guiding document for SME development, the government launched a number of programmes and initiatives – from setting up a dedicated SME development agency and a credit guarantee fund, to measures supporting entrepreneurial learning and women’s entrepreneurship. Since the previous assessment in 2016, significant progress has also been made in improving the operational environment for SMEs and in expanding the provision of export support and promotion services.Going forward, Azerbaijan could take further steps to ensure a level playing field for both SMEs and large enterprises by promoting a more competitive business environment, strengthening the rule of law and improving business integrity. Building on the revitalised SME support infrastructure, future priorities would be to ensure effective co-ordination of newly created entities and initiatives and to build capacities in key institutions, such as Azerbaijan’s new SME development agency, to help them effectively deliver on their mandate. Limited access to finance continues to be a significant barrier for SMEs, and it is important to ensure that recently adopted reforms are fully and effectively implemented.



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