Presented by OECD Secretariat at the Launch of the SME Policy Index Western Balkans and Turkey 2016. 28 April 2016, Paris, France

1. SME Policy Index –
Western Balkans and Turkey
Assessing the Implementation of the Small Business Act for Europe
Launch
28 April 2016
OECD Conference Centre
co-funded by
the European Union

2. 2
Presentation outline
1. Introduction: Small Business Act Assessment
and SME Policy Index
2. Overview: SMEs in the Western Balkans and
Turkey
3. SME Policy Index: Key findings and way forward

3. What is the SBA assessment?
3OECD South East Europe Regional Programme
 The Assessment is based on the Small Business Act for Europe which
allows for benchmarking not only between Partner Countries but also with
EU Member States.
 The dedicated methodology – the SME Policy Index – has been specifically
developed by the partner organisations for the application of the SBA in
enlargement and neighbourhood countries.
 The purpose of the SBA Assessment is to improve SME policy-making in
Partner Countries and to enhance the capacity of policy-makers.
 The objective is to improve the business environment 'on the ground' and
to foster entrepreneurship and competitiveness.
 The SBA (Small Business Act for Europe) Assessment has been jointly
developed and is undertaken by:

4. 3. Methodology
4OECD South East Europe Regional Programme
ASSESSMENT FRAMEWORK REVISION
By OECD experts and Partner Organisations
Phase
I
Phase
IV
Phase
V
Phase
II
Phase
III
SBA assessment: methodology and process
SELF-ASSESSMENT
by the national
governments via policy
assessment questionnaire
INDEPENDENT
ASSESSMENT
by OECD and its partners,
and local experts via policy
assessment questionnaire
OFFICIAL STATISTICS
In the form of business
demographics, quantitative
policy data and company
survey data for in-depth
analysis & greater comparison
STAKEHOLDER MEETINGS IN EACH ECONOMY
OECD, Government stakeholders, SBA coordinators, Partner organisations to reconciliate
ANALYSIS AND DRAFTING
OECD, Government stakeholders, SBA coordinators, Partner organisations to reconciliate
LAUNCH EVENT AND ROAD SHOW
In Paris with OECD, Government stakeholders, SBA coordinators, Partner organisations and then in
each of the 7 participant economies

5. Coverage of the SME Policy Index
5
 Since 2006, the SME Policy Index has been applied 9 times in 4 regions,
covering 32 economies in total:
 EU pre-accession region (the Western Balkans and Turkey) in 2007, 2009, 2012
and 2016
 Eastern Partnership countries in 2012 and 2016
 Euro-Mediterranean Partnership Countries in 2008 and 2014
 ASEAN member countries in 2014.
 Regional SME policy assessments foreseen in Latin America and the Gulf region
Eastern Partner Countries:
2 editions (2016, 2012)
Western Balkans and
Turkey:
4 editions (2016, 2012,
2009, 2007)
Euromed region:
2 editions (2014, 2008)

6. SBA scores for Western Balkan & Turkey
economies
6
Regional Context: SME development is a key to
economic growth
OECD South East Europe Regional Programme
 SMEs represent on average 99.8% of total enterprises in the Western Balkans and
Turkey
 On average 74% of all employees are
employed in SMEs, which is by 7,5% higher
compared to EU average
 Contribution of SMEs to total value added in
the region varies from 53 to 67% (EU28: 60%).
 SMEs’ contribution to employment and value
added is comparable to EU28
0
10
20
30
40
50
60
70
80
Employment VA
Average contribution of SMEs to employment and
VA in the WBT and EU28 countries
WBT
EU 28
 Macro risks and administrative barriers are having an impact on SMEs through
inflation, credit contraction, weak external demand and fiscal consolidation.
%
 At the same time, opportunities exist (e.g., approximation to EU standards,
proximity to EU markets) in addition to leveraging the region’s improvement on
structural policies (e.g. human capital, strengthening of SME competitiveness,
internationalisation)

7. SBA scores for Western Balkan & Turkey
economies
7
Regional Context: Stronger value added growth
in post crisis period (2009-2012*)
OECD South East Europe Regional Programme
Source: OECD Structural and Business Demography Database, National Statistical offices
* CAGR: Compound average growth rate 2009-2012
PRT
ESP
FYROM
CZK
FRA
IRL
DEN
POL
SLV
SRB ITA
HUN
NED
GBR
FIN
BEL
AUT
DEU
SWE
ALB
EST
TUR
EU
EU pre-accession
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
-8% -6% -4% -2% 0% 2% 4% 6% 8% 10% 12%
CAGRofemployment(2009-2012)
CAGR of value added, (2009-2012), constant prices

8. SBA scores for Western Balkan & Turkey
economies
8
Major obstacles for doing business in the
Western Balkans and Turkey (WBT)
0
10
20
30
40
50
60
70
Albania Bosnia and
Herzegovina
Kosovo The former
Yugoslav
Republic of
Macedonia
Montenegro Serbia Turkey
% of
SMEs
Practices of
competitors in
the informal
sector
Corruption
Political
instability
Tax rates
Crime, thief
& disorder
Electricity
Access to
finance
Source: Business Environment and Enterprise Performance Survey, 2013, EBRD
Top 3 obstacles for doing
business in the WBT for
SMEs:
 Practices of
competitors in the
informal sector
 Electricity
 Political instability
*
* This designation is without prejudice to position on status, and is in line with UNSCR 1244 and the ICJ opinion on the Kosovo declaration of independence.

9. Achievements: 10 years overview of SME Policy
in the EU enlargement region
9
OECD South East Europe Regional
Programme
 Effective policy transfer of good
practices was observed through the
SME Policy Index across a number of
areas:
 SME support agencies
established
 Administrative procedures for
businesses simplified
 Technical standards in line with
Single Market requirements
 Support to innovative SMEs and
start-ups provided.
Level 1
Level 2
Level 3
Level 4
Level 5
Level 1: No framework
Level 2: Draft/pilot, some signs of
government activity
Level 3: Solid framework in place
Level 4: Level 3 + concrete indications of
effective policy implementation
Level 5: Level 4 + significant record of
concrete and effective policy
implementation
Note: This comparison only includes the average of indicators which remained the same over time.
Institutional
and regulatory
framework
Business
registration
E-services and
SME support
services
Enterprise skills
and training
SME policy convergence in the EU
enlargement region
2016
2007

10. 0.00
1.00
2.00
3.00
4.00
5.00
1. Entrepreneurial learning and
women's entrepreneurship
2: Bankruptcy and Second
chance for SMEs
3: Regulatory framework for
SME Policy Making
4: Operational Environment for
SMEs
5a: Support Services for SMEs
and Start-Ups
5b: Public Procurement
6: Access to Finance for SMEs
7: Standardisation and technical
regulation
8a: Enterprise Skills
8b: Innovation Policy for SMEs
9: SMEs in a green economy
10: Internationalisation of SMEs
2016
2012
SBA scores for Western Balkan & Turkey
economies
10
Key findings: SBA Scores for WBT economies
OECD South East Europe Regional Programme
Note: Direct comparison between 2016 and 2012 scores is limited due to changes in methodology (introduction of a whole range of new
indicators).

11. Key findings
11
 Limited alternative sources of financing hindering access
to finance for SMEs and poor financial literacy/readiness
programmes.
 Few second-chance programmes available
 Insufficient environmental policies and regulatory incentives
for greening of SMEs.
 SME policy frameworks established in most WBT economies
and more focus towards effective policy implementation.
 Procedural delays and costs associated with business
regulation reduced and introduction of e-government
services, albeit with differences between the economies
 Innovation policy frameworks are progressing
 Progress in aligning legislation with EU standards and
technical regulations
 Public procurement laws in place throughout the region
and efforts in developing e-procurement systems.
1. The region continues to
perform well on SME
Institutional Frameworks and
the Operational Environment
2. There have been notable
improvements on Innovation
policy, Standards and
Technical Regulations, and
Public Procurement
3. Less progress has been
made regarding Access to
Finance, Bankruptcy and
Second chance, and SME
greening
Key findings
OECD South East Europe Regional Programme

12. 1 2 3 4 5
9: SMEs in a green economy
1. Entrepreneurial learning and women's
entrepreneurship
8a: Enterprise Skills
8b: Innovation Policy for SMEs
2: Bankruptcy and Second chance for SMEs
5a: Support Services for SMEs and Start-Ups
10: Internationalisation of SMEs
6: Access to Finance for SMEs
4: Operational Environment for SMEs
5b: Public Procurement
3: Institutional framework for SME Policy Making
7: Standardisation and technical regulation
2016 WBT average scores per dimension
2012 WBT average scores per dimension
12OECD South East Europe Regional Programme
Levels
Key findings: SBA Scores for WBT economies
Level 1: No framework
Level 2: Draft/pilot, some signs of
government activity
Level 3: Solid framework in place
Level 4: Level 3 + concrete
indications of effective policy
implementation
Level 5: Level 4 + significant record
of concrete and effective policy
implementation

13. 13OECD South East Europe Regional Programme
Level 1
No framework/
policy/ institution
exists
Level 2
Pilot or draft
framework/ policy/
institution exists
Level 3
Framework/ policy/
institution established
and first signs of
implementation
Level 4
Policy/ institution is
operational; good
levels of
implementation
Level 5
Fully operational and
functioning monitoring
and evaluation system;
Best practice level
Operational environment
Support services
Public procurement
Access to finance
Enterprise skills
Innovation policy
Green economy
Internationalisation
Key findings: SBA scores per economy by dimension
Entrepreneurial learning and
women’s entrepreneurship
Institutional framework
Standards and technical
regulations
Bankruptcy and 2nd chance
ALB BiH KOS MKD MNE SRB TUR

14. Way forward
14OECD South East Europe Regional Programme
Strengthening the
institutional, regulatory
and operational
environment for SMEs
(D 2, 3, 4)
Develop SME access to
finance (D 6)
Promoting skills and
entrepreneurship
development
(D 1, 8a)
 Strengthen monitoring and evaluation of SME strategies
 Develop measures to address the informal economy
 Continue simplification of business registration; reduce
regulatory uncertainty
 Promote second chance
 Continue to resolve problems of high levels of NPLs
 Broaden the availability of credit information
 Develop alternatives sources of financing
 Strengthen financial readiness and literacy among SMEs
 Integrating entrepreneurship into national curricula
 Promote women entrepreneurship in national strategies
 Strengthen SME skills through training needs analysis and
targeted programs

15. 15
Way forward
Enhancing SME
competitiveness
(D 5, 8b, 9)
Support SME
internationalisation
(D 7, 10)
OECD South East Europe Regional Programme
 Ensure SMEs access to business support information
 Adopt and strengthen innovation policy frameworks
and/or innovation-related infrastructure
 Improve access to public procurement
 Provide guidance and incentives for greening of SMEs
 Establish a single portal providing EU export information
 Reduce regulatory barriers to trade and scale up export
promotion programs
 Start monitoring and evaluating export support activities to
improve their efficiency
 Promote SMEs integration into global value chains

16. Contact details:
Marzena KISIELEWSKA
Head of the OECD South East Europe Division
e-mail: marzena.kisielewska@oecd.org
Sandra HANNIG
Policy Analyst
OECD South East Europe Division
e-mail: sandra.hannig@oecd.org
Anita RICHTER
Project Manager
OECD South East Europe Division
e-mail: anita.richter@oecd.org