Poor business climate, EBRD: Support small business

Poor business climate, EBRD: Support small business

As the opposition steps up its rhetoric against the decision to include small businesses in the VAT scheme, a strong signal of support has come from the European Bank for Reconstruction and Development. 

During the presentation of the 2017-2018 Transition Report, the EBRD asked for more to be done for small business, especially given that they account for 90% of all businesses, making their need for empowerment even more economically necessary.

"Property problems, corruption, non-implementation of contracts and poor infrastructure all damage the climate of doing business in Albania. Albania is the last in the region for business productivity. 

"Small businesses are especially problematic, as their innovative capacity is very low because they are more like family businesses," advised the EBRD.

Even the Governor of the Bank of Albania, Gent Sejko raises the concern of the lack of intervention to increase productivity of small business.

"Inflation is returning to targeted levels and the economic growth is backed by some major infrastructure investments. The main concern for small businesses is unfair competition," explained Gent Sejko.

But will the Western Balkans ever meet the standards of EU countries? Here's what the EBRD has to say on the matter: 

"According to the most optimistic forecasts, Western Balkan countries will need a further 40 years to achieve the living standards of EU countries. The most likely baseline scenario suggests that it will take 60 years. 

"Considering the most pessimistic of scenarios, the region would need a full 200 years to achieve such standards." 

The EBRD report urges regional countries to deliver on EU-oriented reforms, especially those to improve the business climate and provides the reforms in the energy sector as a model. 

According to the EBRD forecast, Albania's economic growth for this year is expected to reach 3.7%.

EMISIONET