Small Enterprise Development in MACEDONIA

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1.2 SME dynamics
Small Enterprise Development
Small and medium enterprises (SMEs in the following) are defined by the Law
on Trade Companies (2004). The National definition of SMEs is broadly, but not
entirely, compatible with that of the EU (see Table 1.1 below). The Ministry of
Economy is working to eliminate discrepancies between the national and the EU
definition of SMEs as well as remaining discrepancies in the definition of SMEs
in various National laws.
Micro
Small
Medium
Table 1.1: Comparison of National and EU Definitions of SMEs
EU Definition Law on Trade Companies (2004)
Up to 10 employees Up to 10 employees
Annual turnover ≤ € 2 million Annual turnover < € 50.000
Balance sheet total ≤ € 2 million
Not more than 80% of the gross income
should come from one client
Up to 50 employees Up to 50 employees
Annual turnover ≤ € 10 million Annual turnover < € 2 million
Balance sheet total ≤ € 10 million Balance sheet total < € 2 million
Up to 250 employees Up to 250 employees
Annual turnover ≤ € 50 million Annual turnover < € 10 million
Balance sheet total ≤ € 43 million Balance sheet total < € 11 million
Source: Ministry of Economy.
As shown in table 1.2, the number of private enterprises has been steadily
increasing since independence. This reflects the increasing importance of the
private sector’s contribution to GDP, employment, exports, etc.
Table 1.2: Number of Active SMEs (1990-2005)
1991 1994 1997 1999 2000 2001 2002 2003 2004 2005(e)
SMEs 9,703* 28,551* 32,934* 31,204* 33,151 34,991 36,963 39,096 41,517 44,327
All 10,270 29,157 33,455 31,795 33,269 35,110 37,074 39,199 41,590 44,667
Source: 1991-2002: State Statistics; from 2003: Central Registry.
Note: (e) …. Data for 2005 are preliminary.
The total number of registered enterprises in the country is ca. 180,000; however,
only about 25 % of those are active in the sense of having undertaken economic
activities during the year in question. As in most other countries, SMEs represent