SME Support and Development Institutions

The importance of a competitive SME sector and the development of internationally competitive SME clusters is widely accepted. Many governments of transition and developing countries have realised that macro-level support alone is not sufficient if the conditions for the development of a strong SME sector are not fulfilled. It is accepted that institutionalised support aimed at assisting SMEs and industrial clusters in developing and adapting to the changing world competition is crucial. This is one of our core competencies and we have successfully developed self-sustainable business support and advice centres in many transition and developing countries.

Examples

policy advice in the areas of SME development and industrial policy;
creation and institutional strengthening of private sector support institutions, e.g. chambers of commerce, industry associations, business support centres, etc.;
development of management consulting clusters and associations;
achievement of financial self-sustainability of business centres;
development and implementation of training programmes for the creation of micro enterprises;
assistance in regional development by creation of adapted infrastructures and improvement of factor conditions;
project cycle management, e.g. project formulation, monitoring & evaluation.

Project Examples

Central and Eastern Europe/CIS

Croatia: PC&A was called upon to strengthen the capacity of policy makers and business organisations to identify, analyse and communicate the future impact of legislative and regulatory changes (i.e. adoption of EU acquis) on business community in Croatia. The main recipients were the Ministry of Economy, Labour and Entrepreneurship, the Croatian Chamber of Commerce, the Croatian Agency for SMEs, the Croatian Employers’ Association and the Croatian Regulatory Office. PC&A defined and delivered training courses to civil servants on selected legislative fields of particular importance for Croatian businesses, namely Consumer and Environmental protection, Standards for both agricultural and industrial products, Public procurement, State aid, Competition policy, and Intellectual property rights. In addition, PC&A trained trainers on impact assessment methodology and introduced guidelines and manuals to enable civil servants to carry out effective legislative impact assessment in future. A further component of the project focused on developing more effective communication between the public sector and the Croatian business community through the design of a range of activities specifically aimed at improving the flow of information to businesses. These activities were developed by PCA following a large scale panel survey on “business needs” covering some 2,000 Croatian firms.
Bosnia & Herzegovina: PC&A provided assistance to EEIC (European Information Correspondence Centre) of Sarajevo for the establishment of a professional documentation centre, for the production of communication and promotion materials and for the revision of the EICC Handbook of Operations related to European Legislation and European Standards and Sectoral Reports. It also delivered training sessions on project management, internationalisation of businesses and public Procurement.
Kyrgyzstan: PC&A provided training to PCEED’s staff (Public Chamber of Economy and Entrepreneurship Development under the President of the Kyrgyz Republic) on daily project activities, and for the preparation and organisation of a National Forum, workshops and meetings on Entrepreneurship Development. PC&A also created a Practical Handbook for entrepreneurs in the private sector in the Kyrgyz Republic.
Armenia: PC&A assisted in the establishment of eight Arbitration Courts at the regional Chambers of Commerce and Industry (CCI) in the Republic of Armenia as an alternative to the judicial court system. After selecting the participating CCIs and designing a protocol for their signature, eight regional arbitration courts were established. We drafted the arbitration procedures, assisted with the selection of arbitrators and prepared and delivered four workshops on arbitration to the regional arbitration courts.
Bulgaria: Technical assistance and training for the establishment and operation of business incubators to the Ministry of Economy.
CARDS Region (Western Balkans - Albania, Bosnia Herzegovina, Croatia, Macedonia, Serbia & Montenegro): PC&A was selected to provide input to the process of strategic programming of the CARDS assistance for the South East Europe (SEE) region during the period 2005-2006. A panorama of the SME sector at country and regional level was conducted in order to identify deficiencies in the SME sector and SME support institutions and to formulate recommendations focusing on potential measures to facilitate the development of an environment conducive to the SME sector in the individual countries as well as the region.
Central and Eastern Europe/CIS: Direct Investment Facility framework contract. We provide a range of multi-disciplinary services (legal, accounting, strategic and investment advisory services) to the DIF management-team of the European Bank for Reconstruction and Development (EBRD) to support their operations relating to SME direct investment, privatisation and post-privatisation, and restructuring across all Central and Eastern European and CIS countries. More than 40 different investments have been screened. Due diligences, risk assessments, financial simulations and exit strategies have been prepared.
Czech Republic: Training on International Accounting Standards/ International Financial Accounting Standards.
Estonia: The Ministry of Economic Affairs and Communications along with its business support agencies is active in building and enhancing Estonia’s industrial capabilities. PC&A assisted the Ministry in facilitating the further development of the national industrial infrastructure support scheme and activate larger and additional infrastructure development projects under the Industrial Infrastructure Grant Scheme.
Estonia: Assistance in project management to the Ministry of Economic Affairs of Estonia, Enterprise Estonia (the Estonian business support institution) and various municipalities.
FRY/Montenegro: Enterprise Restructuring Technical Assistance (2002 – 2003; EUR 1.5 M). Funded by the European Agency for Reconstruction we assisted the Government of Montenegro in restructuring and privatising five enterprises. The institution building component of the project was designed as a means to address the socially adverse consequences of restructuring and privatisation (reduction of employment, at least in the short run) and comprised the following activities: establishment of Regional Business Information Centres; design and implementation of a Business Start-Up Programme and Business Skills Courses for redundant workers; Assistance in the design of a Micro Finance Programme for Start-Ups; designing and implementing a pilot phase (including trainer training) of a corporate governance education strategy and training scheme, and preparing a corporate governance manual; designing and implementing an effective Public Education/ Information Campaign.
Kosovo: The Kosovo economy has made impressive progress since 2000, as a result of sound policies, institution building, and large scale donor assistance. In order to better target assistance to sectors where it is needed most, the European Agency for Reconstruction (EAR) invited PC&A to prepare a study of all SME related programmes in Kosovo.
Latvia: Institutional Capacity Building for EU Structural Funds in Zemgale region. We strengthened the capacity of the Zemgale Development Agency (ZDA) and its regional partners in project identification, elaboration, detailed preparation and project cycle management.
Latvia: PC&A was called upon to reassess and modify an earlier proposal for EU financing entitled “Riga Science and Technology Park”, which was submitted but subsequently rejected for funding from the Phare 2001 programme. The Park aims to attract and develop SMEs from the high tech industry in co-operation with major universities, research institutions and public authorities.
Moldova: Formulation of SME Development and Restructuring and Cross Border Co-operation projects.
Russian Federation: Enterprise Support Centres in the Kaliningrad and Irkutsk Oblast and the Autonomous Republic of Buryatia. PC&A assisted the local administrations in establishing industrial advisory centres that would function on a self-sustaining basis after the end of the respective projects. We also provided privatised medium and large enterprises in the three regions with Technical Assistance for restructuring, improvement of efficiency and adaptation to the emerging market economy.
Slovak Republic: Programme for Enterprises with Excess Debt (SPEED). The programme objective was to improve the competitiveness and economic performance of the private enterprise sector, thereby leading to sustainable economic growth and stable employment. The institution building component of the programme aimed at strengthening the Slovak Agency for Industrial Development and Revitalisation (AIDR) to become self-sustaining and contribute effectively to the restructuring of enterprises.
Slovenia: Industrial Strategy for the machine and tool building industry. We assisted the Ministry of Economic Affairs of the Republic of Slovenia in the design of an overall promotional industrial strategy, the identification of key policy measures to enhance the strategy for the country's machine and tool building industry and an increase of the role and effectiveness of the industry associations and chambers of commerce.

North Africa and Middle East

Algeria: As part of the MEDA programme initiative to strengthen the private sector in Algeria in anticipation of the entry into force of the EU-MEDA Association Agreement, the project aimed to reinforce the competitiveness of Algerian SMEs, either directly through business upgrading actions, or indirectly through strengthening the SME enabling environment. In this frame, PC&A provided services of business upgrading in 300 Algerian SMEs of various sectors. (Construction materials, Agro-food, Paper & carton industry, Printing industry, Plastic processing, Metal-mechanical, Chemical products, Consumer electronic equipment). Horizontal actions of training were also organised for SME managers and staff on management, technical or quality issues.
As part as the objective of strenghtening the enabling SME environment, PC&A delivered training and strategic plans to the finance and banking sector, with the purpose of improving access of local SMEs to financing, improving relations between SMEs and banks, and strengthening the strategic, analysis and decision-making skills of banks and guarantee funds. In particular, PC&A elaborated and implemented an enterprise rating system. Furthermore, PC&A provided services like sectoral analyses and strategic plans, communication and information management tools etc., to government bodies and intermediary organisations, such as Chambers of Commerce, Industry and Business Associations, Information centres etc.
Morocco: Under the Programme “Support for the Promotion of Quality” funded by the European Union under the Euro-Mediterranean partnership, the structures of the Technical Centre for Food Industries (CETIA) were made operational by PC&A, notably its Technological Platform and Laboratory of physical-chemical, microbiological and sensory evaluation, in order to meet the needs of the sector.
Morocco: PC&A delivered a feasibility study on the creation of a control lab for automobile cable clusters in Morocco.
Morocco: Under the Programme "Support to Businesses” funded under the Euro-Mediterranean partnership, PC&A delivered a feasibility study on the Morocco Technical Centre for Industrial Chemicals. PC&A produced an analysis of the sector highlighting the needs of the manufacturers, a programme of assistance for the Centre in both technical and commercial areas, an organisational scheme and details of operation of the Centre for the first 3 years.
Tunisia: In order to position Tunisian industrial enterprises in an increasingly competitive international environment and identify opportunities to create new industrial projects, the Centre for Studies and Industrial Opportunities (CEPI) of the Industry Promotion Agency (API) has asked PC&A to define strategic opportunities for automotive electrical components and accessories.
Tunisia: The mission's objective was to strengthen the Technology Watch activity in the CTMCCV (Technical Centre for Building Materials, Ceramics and Glass) and in Technical Centre of Mechanical and Electrical Industries (CETIME), and to provide training and transfer of know-how to the staff. Result: The watch division was active in the two Centres and staffs were operational.
Tunisia: the objective of the project was to assist two newly created business incubators with a view to help them acquire techniques of supporting/coaching entrepreneurs, attract a sufficient flow of entrepreneurs to saturate their accommodation capacity, and to develop a coaching activity in the business incubators. PC&A assisted the managers of the business incubators to develop good practices in terms of supporting business creation and designed a full manual of procedures, transmitted to the managers of the business incubators.
Egypt: Within the Industrial Modernisation Programme in Egypt (IMP), PC&A provided business upgrading services (processes; planning, costing, pricing) to 15 SMEs of the furniture sector, included benchmarking, implementation and evaluation, with the aim of increasing their participation in international markets.
Syria: The purpose of the assignment was to identify the existing short-comings affecting the performance of the glass sector in Syria and to propose effective ways to help develop the sector to achieve its full potential. We prepared a sector policy paper addressing the legislative environment, manufacturing and environmental issues, quality issues, markets, marketing and distribution, investment needs and policies to attract FDI.
Algeria: In a comprehenisve programme, PC&A contributed to the strengthening of Algerian private sector support institutions. The assistance consisted of the following components: Implementation study for an Electrotechnical Committee (CEA) within the Algerian Normalisation Institute (IANOR); Capacity building of the National Technical Committee and the National Conformity Evaluation System; Training on CE Marking to various Chambers of Commerce; Training in Strategic Management and Organisation of several Business Support Institutions.
Algeria: PC&A provided assistance to the Algerian Ministry of Small and Medium Enterprises (SME) for the preparation of an industrial development strategy for the handicraft sector. In cooperation with the major stakeholders, we identified short, medium and long term strategic objectives and devised an action plan to reach these objectives.
Egypt: On behalf of the Egyptian Industrial Modernisation centre (IMC), PC&A was asked to prepare a programme for the creation of a professionally trained cadre of competent, skilled consultants and advisors, covering the full range of business management areas, available throughout Egypt. We prepared a detailed programme for the training of 300 business consultants, comprising the methodology to identify and recruit the consultants and the training methodology.
Jordan: Through various sub-projects of the Industrial Modernisation Programme, PC&A provided technical assistance to Jordanian Technical and Vocational Education and Training (TVET) institutions. The purpose of assistance was to promote excellence in the design, delivery and evaluation of TVET provision to Jordanian SMEs within specific industrial sectors:
- We prepared a comprehensive operational work plan for the establishment of a National Training of Trainers Institute under the umbrella of the Al-Balqa Applied University (BAU) and assisted in the creation of a TVET Centre of Excellence within the University;
- Identification of training needs within the textile and garment industry and proposals for the establishment of a TVET Centre of Excellence for the textile and garments industry;
- We assisted the TVET Centre of Excellence in Industrial Design during its initial development phase. Our role was to establish a commercially viable and fully operational centre.
Jordan: The Jordan Upgrading and Modernisation Programme (JUMP) was developed in response to a request from the Ministry of Industry and Trade (MoIT) to assist the Jordanian industry in modernising and becoming more competitive in domestic and foreign markets. JUMP provides capability and capacity building services to SMEs; the capability building takes the form of diagnostic studies, technical assistance and training, for which JUMP requires the services of a large number of local consultants and their expertise. PC&A’s assistance helped JUMP through the preparation of an Action Plan to upgrade the consultancy capabilities in Jordan. In addition, PC&A provided a Senior Adviser to advice and coach the CEO of JUMP in various aspects of the organisation’s set up, management, operations and leadership. We furthermore assisted JUMP in implementing Quality Enhancement and Cost Accounting System upgrading tools, and provided training to JUMP staff and a group of consultants on the upgrading directives and their implementation.
Jordan: PC&A assisted the Jordanian Upgrading and Modernisation Programme (JUMP) in implementing Quality Enhancement and Cost Accounting System upgrading tools, and provide training to JUMP staff and a group of consultants on the upgrading directives and their implementation.
Jordan: For the Monitoring and Evaluation Unit (M&E Unit) of EJADA (Euro-Jordanian Action for the Development of Enterprise), PC&A appointed a Senior Business Monitoring and Evaluation Expert to support the development of the evaluation capacity for the EJADA programme. The general objective of the assistance was to enhance the M&E function of EJADA and to facilitate the establishment of consensus among the stakeholders so as to establish a participative and transparent monitoring process.
Jordan: PC&A established a state-of-the-art agro-industry incubator to spur business innovation in the agro-industry sector, which is considered to be among the country’s high-potential sectors. Our team set up the incubator based on best international practices. It also managed the incubator for one year and provided on-the-job training to local staff before progressively transferring responsibility for the Incubator to them.
Jordan: PC&A has been appointed Programme Management Consultant in charge of managing the EU-funded Graduate Enterprise Programme (GEP) in Jordan. Our role was to recruit, place, train and systematically support Jordanian new graduates within the SME sector over a one year period. Since early 2004, nearly 150 graduates in marketing, information and communication technologies and industry related engineering disciplines have been recruited and placed for one-year traineeships in Jordanian SMEs.
Jordan: Over one year we provided support to the Direct Support to SMEs Component of EJADA (Euro-Jordanian Action for the Development of Enterprise). The work included assisting with the operational management of the Business Upgrading sub-component, training to other members of the organisation, management of a portfolio of beneficiary companies, and assisting with the design of new programmes of assistance.
Jordan: PC&A was selected to manage the Euro-Jordanian Advanced Business Institute (EJABI) for 6 months. The purpose of EJABI is to offer a number of management development and training programmes and courses to enhance the capabilities of middle and top management of SMEs in Jordan, as well as provide a range of professional support services to SMEs. The role of our consultant was to steer the organisation through the critical first months of its existence, before handing over the responsibility to the permanent management.
Jordan: In two related projects to improve the availability of technical expertise within the textile and garment sector in Jordan, PC&A assisted in the establishment of a national training of trainers institute under the umbrella of the Al-Baqa Applied University as well as in the establishment of a Technical and Vocational Education Training (TVET) Centre of Excellence within the University.
Jordan: PC&A designed and delivered a comprehensive workshop on finance and accounting to 20 pre-selected non-financial managers of high-potential Jordanian SMEs. The aim of the workshop was to address one of the main weaknesses of the Jordanian SME community, which is the lack of understanding of basic financial and accounting concepts among non-financial managers.
Jordan: PC&A carried out a full assessment of the business incubator project in Jordan. After a diagnosis of the current business support structures available to Jordanian SME’s we prepared recommendations for improved facilities, including the setting up of a technology incubator, an employment incubator and a SEED capital fund.
Jordan: Preparation of the institutional framework of the Industrial Modernisation Programme. Components of the IMP are: direct services to small- and medium sized enterprises (SMEs) and start-up companies as well as the strengthening of SME support institutions; financial support to SMEs through a guarantee fund and the improvement of existing financing schemes; vocational training; institutional strengthening and policy support.
Lebanon: We designed a product-specific Action Plan for the industrial sector to facilitate and enhance industrial activity and to better enable the sector to benefit from the bilateral free trade agreements signed with several Arab countries like Syria, Kuwait, Jordan, Egypt, UAE and Iraq, and particularly from the Association Agreement concluded with the European Union.
Lebanon: Strategy Paper for Establishment of Business Support Centres. We assisted the Ministry of Economy & Trade (MoET) to develop and propose terms of reference for individual Business Support Centres (BSCs) in Lebanon.
Lebanon: Organisation review and strategy development for six Lebanese private sector support institutions – two Chambers of Commerce, Industry and Agriculture; three Professional Associations; the Lebanese Normalisation and Certification Institution.
Morocco: Design and implementation of a cycle of seminars for the ANPME (National Agency for the Promotion of SMEs). The programme covered training of staff of the business support agencies in the fields of finance, management of SMEs, communication and management techniques.
Syria: Institutional upgrading of the Federation of Syrian Chambers of Commerce, various individual chambers of commerce, and Aleppo Chamber of Industry. The overall objective of the project was to enhance the competence and efficiency of the Syrian Chambers in the fulfilment of their duties and functions as service-providing unit, and to act as representatives and competent interest groups, advocating the interests of their members at the national level in order to achieve a positive impact on the economic development and performance of the private sector. We prepared a performance review for the Chambers of Commerce, designed and finally implemented an upgrading strategy.
Syria: Preparation of Sector Development Action Plans. PC&A was called upon by the Syrian-European Business Centre to assess the performance and competitiveness of four target sectors (furniture, packaging, home appliances and IT applications). The IT sector was selected for further in-depth study, resulting in comprehensive recommendations for a policy framework and development programme for the sector.
Syria: With the overall objective of raising Syrian business awareness to international competitiveness, capabilities and performance through assistance and support, PC&A delivered a series of training courses in “Finance for non-financial managers” to nearly 100 non-financial managers. A handbook based on the course content was further prepared and distributed widely among Syrian private enterprises.
Syria: On behalf of the Syrian-European Business Centre (SEBC), PC&A prepared the strategic plan for the establishment of a self-sustainable SME support institution, including the institution’s mission, strategy, business areas, ownership, and organisational and legal structures.
Tunisia: Electronic Payment System for the Tunisian Industry Promotion Agency. In the context of the Industrial Promotion Programme, the Tunisian Industry Promotion Agency asked PC&A to install a system for electronic payments of its services to companies, as well as a system for the management of subscribers to the Industrial Information Database (5400 companies) and company sheets.
Tunisia: PC&A provided assistance for the institutional strengthening of the Tunisian Technical Centre for Chemistry (CTC), a support institution for the chemistry sector. We provided recommendations for the setting up of a new and strengthened documentation centre, for improvements in the management structure and for necessary material and immaterial investments over a five-year period.

Other regions

Benin: PC&A provided a mid-term evaluation of the EU Programme for the integration of the local private sector into the global private sector following the Cotonou Agreement signed in June 2000. PC&A was asked to evaluate the relation between the means made available by the government and the activities that are recommended for the improvement of the private sector. Recommendations for the improvement of the strategy of development of the private sector were delivered by PC&A.
Mali: PC&A provided support to the Ministry of Trade and Industry in the analysis and development of policies for the private sector, and also in the framework of EPA (Economic Partnership Agreement) negotiations between the EU and West Africa.
Dominican Republic: The Programme to Support Small Private Dominican Enterprises (Programa de Apoyo a la Pequeña Empresa Privada Dominicana, PROEMPRESA) aims at modernising Dominican production capacity by providing support to growth oriented small enterprises. The EUR 12.26 M programme is co-financed by the EU (EUR 9.8 M contribution), the Government of the Dominican Republic and the beneficiaries. PC&A was called upon to assess the relevance of the programme as well as to determine progress towards the achievement of the programme results as outlined in the programme’s Logical Framework (effectiveness);
Argentina: PC&A was asked to assist the Ministry of Economy improving the competitiveness of SMEs in the forestry sector, with particular focus on improving the business environment for the sector. After an initial analysis of the threats and weakness of the sector, we elaborated a strategy to ensure the sustainability of the sector’s development. The strategy included measures to ensure the sustainable protection and exploitation of the forest’s natural resources, the introduction of new technologies in the sector, and the strengthening of institutions which offer services to SMEs in the sector.
Cambodia: Formulation Mission for EC funded Programme for Development of SMEs in the Agro-Industry Sector. Given the importance of agro processing for the development of the Cambodian economy, a comprehensive EUR 10 M programme was formulated. The programme will have two components, one being directed towards improving the business environment, and the second one towards direct support of SMEs in three branches of the agro-industry sector.
Dominican Republic: We undertook the mid-term evaluation of the Programme to Support Small Private Dominican Enterprises (PROEMPRESA) aims at modernising Dominican production capacity by providing support to growth oriented small enterprises. The EUR 12.26 M programme is co-financed by the EU, the Government of the Dominican Republic and the beneficiaries. The objectives of PROEMPRESA are to develop the market for Business Development Services (BDS) targeting small enterprises, to strengthen associations of small enterprises and BDS providers, and to improve the Dominican business environment for small enterprises.
Kenya: PC&A prepared a programme in support of micro and small enterprise (MSE) development in Kenya. The project covered the development of a favourable legal and regulatory framework, as well as the development of business support services and measures to improve the access of SMEs to finance.
Pakistan: The Business Support Fund (BSF) was established by the Pakistan Government and the private sector as part of the ADB-supported Small and Medium Enterprise (SME) Sector Development Programme (SDP). The objectives of the BSF are: a) to enable SMEs to effectively utilize external business services to enhance revenue-generating ability and profitability and; b) to promote and stimulate Business Development Services (BDS) providers outreach to SMEs. PC&A has been contracted by the Ministry of Finance (MOF) to manage the operations of the BSF.
Bhutan: In a 1 M EUR project financed by the Asian development bank (ADB) PC&A is implementing Component 1”MSME Development Policy, Strategy and Incentive Framework, and Management of Cost Sharing Facility (CSF)” of the overall Micro, Small and Medium-sized Enterprise (MSME) Development Programme. The immediate objectives of the project are to set up an institutional framework to support effective MSME sector development and enhance access to and quality of non-financial services to foster MSME sector growth and MSME competitiveness. The project consists of two sub-components, the “National MSME Policy Framework” and “Effective market for Business Development Services” component. Among others the following type of services will be provided: institutional strengthening, capacity building of the government to draft a national MSME strategy, assistance in preparing and managing the CSF as well as providing trainings and Human Resource Development.
Bangladesh: PC&A conducted an ex-post evaluation of the Bangladesh Small Project Facility (SPF) and reviewed the proposal for EC support for the operation of Phase II of the South Asia Enterprise Development Facility (SEDF) II. PC&A also assisted in the identification of new private sector initiatives foreseen as a follow-up, development and extension to the SPF and SEDF.
St. Lucia: PC&A was invited to undertake a baseline study of the characteristics of the private sector, including its constraints and potentials in the national and global economic environments, examination of sector policies and institutional frameworks, and provision of recommendations on appropriate policy measures, institutional structures and capacity building initiatives for future Private Sector Development programmes and activities. To obtain these objectives the following studies were carried out: Enterprise Census aiming at creating a comprehensive list of enterprise to provide a frame for the enterprise activities in St. Lucia and Investment Climate Survey aiming at evaluating the investment climate in St. Lucia in all its operational dimensions and promote policies to strengthen the private sector priorities and requirements.
El Salvador: PC&A completed the final evaluation of the project “Strengthening the competitiveness of Micro and Small Enterprises (MSME) in El Salvador (FOMYPE)” based on the evaluation criteria of the EU (relevance, effectiveness, efficiency, sustainability and impact). The team therefore assessed the extent to which the FOMYPE project has achieved its objective of strengthening the competitiveness of MSMEs.