Description
International Projects Of Sme Support In Armenia
PB
National Strategy
of Small and Medium
Entrepreneurship Development
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INTERNATIONAL PROJECTS OF SME
SUPPORT IN ARMENIA
This Paper presents the SME support projects carried out in Armenia by international organizations
during the last decade and analyzes their impact.
2
CONTENTS
Projects Implemented in Armenia ................................................................................................................. 3
Enterprise Europe Network (EEN) ............................................................................................................ 3
United Nations Development Programme (UNDP) ................................................................................ 3
“Development Cooperation” Program Implemented by the Dutch EVD Agency .................................. 3
Yerevan Office of the Organization for Security and Cooperation in Europe (OSCE) ......................... 4
German Agency for International Cooperation (GIZ) ............................................................................. 4
Black Sea Basin 2007-2013 Joint Operational Programme .................................................................. 4
Dutch Centre for the Promotion of Imports from Developing Countries (CBI) .................................... 5
Japan International Cooperation Agency ................................................................................................. 5
Eurasia Partnership Foundation (EPF) ...................................................................................................... 5
Turnaround Management Group (TAM) and Business Advisory Service (BAS)
Programs in Armenia ................................................................................................................................. 6
Activities of the Small and Medium Business Foundation ...................................................................... 6
Competitive Private Sector Armenia/CAPS (USAID) .............................................................................. 7
Chamber of Commerce and Industry of the Republic of Armenia ......................................................... 7
Gegharkunik Chamber of Commerce and Industry (GCCI) ................................................................... 8
Armenian Development Agency ............................................................................................................... 9
United Nations Industrial Development Organization (UNIDO) ........................................................... 9
OSCE Office ............................................................................................................................................... 10
American University of Armenia / Turpanjian Rural Development Program ...................................... 10
World Bank Armenia Country Office ...................................................................................................... 10
3 2
Projects Implemented in Armenia
Enterprise Europe Network (EEN)
Since 2008, the “National Center for Development of Small and Medium Entrepreneurship in
Armenia” Foundation has been the hosting partner of the EEN in Armenia as a result of a tender
announced by the European Commission for selecting partner organizations; it presently operates as
the Enterprise Europe Network Contact Point in Armenia (EENCPA). The Enterprise Europe Network,
which officially launched its activities in February 2008, brings together around 600 partner
organizations from over 50 member states, offering numerous professional business services to its
beneficiary organizations.
The EEN offers the following services:
• Enterprise support in identifying priorities for new business cooperation, market research,
and finding potential partners;
• Support to negotiations and the signing of cooperation contracts;
• Enterprise support in assessing their readiness and capacity to deal in international markets;
• Support to innovative SMEs in testing and commercialization of their initiatives; and
• Feedback and response to issues raised by enterprises.
United Nations Development Programme (UNDP)
The “Support to SME Development in Armenia” joint project of UNDP and the SME DNC of Armenia
has been implemented since 2004. Project activities have been carried out under the following
components during the last two years: “Development of SME Support Mechanisms and Capacity
Building of the SME DNC,” “Cluster Development and Improvement of the Business Knowledge and
Skills of Start-up Businesses,” “Provision of Information and Counseling Services to SMEs at the
Central and Regional Levels,” “Enhancement of the Business Knowledge and Skills of Businesses and
Implementation of a Sector Development Project in One of the Regions of Armenia,” and “Provision of
Information and Promotion Services to SMEs at the Central and Regional Levels.”
“Development Cooperation” Program Implemented by the Dutch EVD Agency
Under the Development Cooperation Program implemented by the Dutch EVD agency, the SME DNC
of Armenia has worked on engaging SMEs active in various sectors in the program since 2008.
The aim of the Development Cooperation Program is to promote business cooperation between SMEs
in the Netherlands and in various countries of the world in order to develop their business potential
and to expand the scope of their entrepreneurial activities. Presently, the Program operates in over
40 countries, including Armenia. The Program enables local SMEs active in various sectors to identify
credible Dutch partners and to establish business cooperation in the international and local markets.
4
Yerevan Office of the Organization for Security and Cooperation in Europe (OSCE)
With the support of the Yerevan Office of the Organization for Security and Cooperation in Europe,
the SME DNC of Armenia has developed and published a number of information and analytical
materials and bulletins.
In 2009, in the framework of the cooperation with the OSC Yerevan Office, the Guesthouse Cluster
Development Program was implemented in the Syunik region of Armenia, which provided relevant
training to 59 beneficiaries in the districts of Goris, Sisian, Kapan, Meghri, and Agarak. The Program
supported the elaboration of a cluster development strategy. Guesthouse marketing centers were set up.
Under this Program, a number of simplified guides, handbooks, and manuals on issues in the SME
sector were developed and published.
German Agency for International Cooperation (GIZ)
On 31 January 2011, a Memorandum of Understanding was signed between the SME DNC of
Armenia and the “Municipal and Economic Development in Armenia” Project of the (GIZ).
In view of the importance of strengthening the SME sector in Armenia as a precondition for
progressive development and social-economic stability, the Parties agreed to combine and focus their
joint efforts with a special emphasis on support to business startups and regional economic
development issues by means of capacity building of the SME Development National Center of
Armenia and providing knowledge on the CEFE (Competency Based Economies through Formation of
Enterprise) and PACA (Participatory Appraisal of Competitive Advantages) tools.
The beginning of the cooperation was marked by the launch of the training of trainers course using
the CEFE methodology, which ended in March 2011. Representatives of the regional branch offices
of the SME Development National Center of Armenia took part in the course. Under this cooperation,
the PACA tool was presented to the staff of the SME DNC of Armenia by the Gegharkunik Chamber
of Commerce and Industry in April 2011.
Black Sea Basin 2007-2013 Joint Operational Programme
From 1 June 2011 to 30 November 2012, the SME DNC of Armenia will participate, as a partner, in
the “Black Sea Tradenet Network” grant project (hereinafter “the Project”) implemented in the
framework of the Black Sea Basin 2007-2013 Joint Operational Programme.
The Project will be implemented through cooperation between seven organizations representing
Romania, Greece, Bulgaria, Armenia, and Turkey.
The main goal of the Project is to promote, by joint efforts and resources, interregional economic
cooperation, to improve access to interregional information and business support tools for
entrepreneurs and potential investors, and to build the capacity of business support providers.
Under the Program, a “Black Sea Tradenet Network” will be created with coordination by the
organizations participating in the Project. Based on the analysis of the business environment in the
participating countries, commercial atlases of the participating countries will be developed and
5 4
published. Support will be provided to the establishment of cooperation between businesses. An
online database of business proposals will be created, and other activities will be carried out. The
analysis of the business environment will focus on the following areas: legal (organization
registration, creation of a joint enterprise, and so on), investment (main investment projects of recent
years, main priorities, trends, competition policy, and so on), export/import (legislation and
requirements), business culture, sources of financing, infrastructure, and local resources of trans-
border interest.
Dutch Centre for the Promotion of Imports from Developing Countries (CBI)
With a view to supporting exports of products of enterprises operating in Armenia to the EU
countries, the SME DNC of Armenia cooperates with the Dutch Centre for the Promotion of Imports
from Developing Countries (CBI), which is one of the leading EU organizations in this sphere.
The SME Development National Center of Armenia is the partner organization for the Export
Coaching Program implemented by the CBI in 47 countries of the world.
In cooperation between the SME DNC of Armenia and the Dutch Centre for the Promotion of Imports
from Developing Countries (CBI), a seminar on “Export Marketing Strategy” was held in Yerevan for
enterprises of small and medium enterprises that are exporting or have export potential, as well as for
business service providers (BSPs). During the seminar, the participants received comprehensive
information on the export process and the EU market trends and needs. The seminars were
conducted by CBI experts with international experience.
Japan International Cooperation Agency
In 2010, the SME DNC of Armenia developed and presented to the Japan International Cooperation
Agency a technical cooperation program for “Development of Local Production and Promotion of
Local Brands.” The implementation of this project would allow studying and implementing the
Japanese experience in local economic development, as well as carrying out a pilot program with
coordination by international experts.
Eurasia Partnership Foundation (EPF)
2004
Support to small and medium business creation by creating favorable conditions for business and
establishing a dialogue between the public and private sectors. The Eurasia Partnership Foundation
supported the performance of a number of consulting activities, including the development of
mechanisms for cooperation between businesses and the state, the improvement of legislation, and
short-term awareness campaigns for improvements in the judicial, legislative, and executive
systems of government.
2005
The Eurasia Partnership Foundation supported the development of small and medium businesses in
Armenia through the development of alternative dispute resolution mechanisms. This project
included the following activities: awareness-raising campaigns alternative dispute resolution,
6
development of formal mechanisms promoting alternative dispute resolution in Armenia, capacity
building of the mediation judges, and lobbying of the legislative amendments concerning
alternative dispute resolution.
2006
The EPF, together with the Gegharkunik Chamber of Commerce and Industry, carried out the
“Effective Business” project for over 300 enterprises of the Gegharkunik region. The targeted
enterprises benefited from counseling and training support mechanisms, as well as support with
direct marketing of their products.
2008-2009
The EPF implemented a project for the development and implementation of a social responsibility
strategy in large enterprises. As a result, over 10 large enterprises of Armenia implemented more
effective policies and measures of social support.
Turnaround Management Group (TAM) and
Business Advisory Service (BAS) Programs in Armenia
The BAS program was founded in Armenia in 2003 with the EU’s financing. Over 842 BAS projects
have been implemented in Armenia, covering total financing of over EUR 5.3 million. Further
financing was provided by the Early Transition Countries Initiative (ETCF) of the EBRD, Europeaid,
Canada (CIDA), the Chinese Taipei, and USAID. BAS has undertaken 639 consulting projects,
hiring 87 (mostly local) consultants.
The projects supported by the TAM and BAS programs contain elements and examples of the
international best practice of enterprise management in areas such as improvement of
management skills, production and quality control, and marketing, which make the enterprises
more competitive and more attractive for external financing. The TAM and BAS programs support
the development of a market economy by promoting local business advisory skills.
In 2011, the European Union will extend a grant of around EUR 800,000 to finance expert and
advisory services provided to small and medium enterprises in Armenia. Around 100 business
advisory projects are to be implemented.
Activities of the Small and Medium Business Foundation
This organization has been active in the following main areas:
• Expert assessment of the business potential of the communities of Armenia, the business
environment, the effectiveness of the existing infrastructures, and the institutional obstacles
to business development;
• Development of recommendations on the business and investment environment in the
frameworks of the participatory review of the PRSP;
• Creation of a Mediation Court for extra-judicial resolution of disputes in the SME sector,
jointly with the Association of Young Lawyers of Armenia;
• Publication of the “Small and Medium Entrepreneurship against Corruption: Perceptions and
Possible Solutions” booklet; and
7 6
• High-quality professional advice and technical and information support aimed at SME
development.
Competitive Private Sector Armenia/CAPS (USAID)
The Competitive Private Sector Armenia/CAPS project was a five-year support project funded by the
United States Agency for International Development (USAID). The project applied a cluster approach
aimed at improving the business environment and promoting cooperation between enterprises in
specific sectors.
The CAPS project worked with four of the key developing sectors of the Armenian economy:
information technologies, tourism, pharmaceuticals, and engineering services. The project supported
the development of products and services competitive in the international market, as well as the
creation of sustainable companies offering such products and services. CAPS provided technical
assistance to companies in various formats, including consulting, capacity development of business
associations, policy research and advocacy, public outreach, training of the labor force, and joint
public-private initiatives.
The project applied a cluster approach to promoting competitiveness, which was the only one among
all the initiatives aimed at developing the private sector in Armenia. The cluster consisted of all the
key stakeholders of the relevant sector: private enterprises (regardless of their size), producers,
suppliers, customers, labor force, government, professional associations, and academic, research,
and educational institutions. CAPS promoted cooperation between these stakeholders, which
benefited individual enterprises and the Armenian economy as a whole.
Chamber of Commerce and Industry of the Republic of Armenia
The Chamber of Commerce and Industry of the Republic of Armenia was formed in April 2002 on the
basis of the Republic of Armenia Law on Chambers of Commerce and Industry.
The tools used by it in the area of business support are listed below:
• Organizing the consolidated participation of Armenian businesses, enterprises, and
organizations in trade fairs and exhibitions held in Armenia and abroad;
• Organizing and conducting national exhibitions of Armenia abroad, organizing national
exhibitions of foreign countries in Armenia, and providing space indoors and outdoors for
exhibitions;
• Developing catalogs, invitations, booklets, and other promotional materials for exhibitions
organized in Armenia and abroad;
• For commending and encouraging outstanding performance results of businesses in the
national economy, the Chamber of Commerce and Industry of Armenia has set up the
“Mercury” awards, and the highest award of the Chamber, the “Gold Medal,” was instituted in
2008;
• To date, the Chamber has organized a large number of business conferences attended by
Armenian and foreign businesses, which has enabled Armenian businesses to interact with
their foreign counterparts, sign mutually beneficial contracts and agreements, and reach
understandings on future cooperation;
8
• Dissemination of information on Armenian companies, projects, products, and services;
• Creation of productive business ties, export and import promotion, and investment
promotion;
• In 2006, Armenia adopted a Law on Commercial Arbitration, in accordance with which an
Arbitration Court was created in 2007 under the auspices of the Chamber of Commerce and
Industry of Armenia; and
• As an entity supporting businesses in the field of foreign trade, the Chamber of Commerce
and Industry of Armenia has the power to issue country of origin certificates.
In close collaboration with its member companies, the Chamber of Commerce and Industry of
Armenia is organizing various seminars, meetings, and workshops aimed at improving the business
environment, developing small and medium enterprises, supporting the comprehensive and
harmonious development of all forms of enterprise, and promoting free competition. The seminars
involve discussions of all the legislative amendments and additions, as well as their application
peculiarities, allowing companies to come together and to address priority issues.
Gegharkunik Chamber of Commerce and Industry (GCCI)
The GCCI was founded in 2002 with the mission of promoting and strengthening the business
community in the Gegharkunik region. The activities of the GCCI include business planning,
consulting, training courses, support to start-up enterprises (including loans from the “Successful
Beginning” foundation), and advocacy. To date, the GCCI has worked with over 1,200 businesses
and numerous other organizations.
The GCCI is presently implementing the following projects:
• Social-Economic Self-Organization in the Rural Communities: this is a three-year project the
implementation of which began in 2009. It is co-financed by the European Union and “Caritas
International Belgium.”
The goal of the project is to generate significant positive change in five rural communities of the
region by offering social and economic development possibilities with the participation of the
communities.
• Microfranchising
The main goal of the project is to create a replicable business model and to suggest that start-up
businesses create small businesses in their communities.
This project provides business training. “Zartnir” (lit. “Wake up”) computer centers have already been
created in the Gegharkunik and Tavush regions.
• Advocacy and Assistance Center
The implementation of this project began in 2009 with the support of the USAID. The Center
provides free-of-charge legal advice and support to citizens and businesses (including representation
of their interests in court), identification of systemic and procedural weaknesses, developing and
implementing reform strategies, and public awareness-raising activities.
• Small and Medium Enterprise Support Program
9 8
The activities in this area are mainly concentrated in the following area:
• “Successful Beginning” long-term course and consulting program/microfranchising.
“Successful Beginning” is a campaign for setting up a new enterprise, which is aimed at supporting
and guiding viable start-up businesses.
To implement this program, the Local Economic Development component pursues the goal of
creating a sustainable system of SME support through the following:
• Creating a network of trainers and experts;
• Continuous development of opportunities for partners;
• Creation of start-up businesses in various communities of Armenia; and
• Raising awareness of the program.
The PACA tool introduced by the GCCI and the ProSME makes up the methodological foundation of
community economic development and is a participatory tool.
Armenian Development Agency
The Armenian Development Agency (“ADA”) closed joint-stock company was created in April 1998
by the Government of Armenia. The goal of the ADA is to support the attraction of foreign direct
investments and to promote exports.
The ADA is a “one stop shop” agency that supports investors in doing business in Armenia and acts as
a bridge between businesses and state bodies. The ADA discovers the sectors of the Armenian
economy that are attractive for investments, promotes investments in such sectors, and protects the
interests of investors.
The services of the ADA include:
• Provision of comprehensive information (preparing an information package meeting the
expectations of foreign investors);
• Organization of site visits (planning site visits of potential investors, making the necessary
arrangements with private and public organizations, and organizing the visit to the
investment site, including airport pick up, interpretation, and support in choosing a site);
• Identification of an agent for business cooperation in Armenia;
• Follow up support (support to follow up visits and preparation of additional information and
paperwork);
• Implementation of investment projects (company registration support, staffing, job
interviews, and interviews); and
• Establishing links with government bodies.
United Nations Industrial Development Organization (UNIDO)
UNIDO helps Armenia to promote the following sectors:
• Development of the private sector, with a focus on export consortia and corporate social
responsibility;
10
• Capacity building of the Armenian Development Agency to discover possibilities of business
cooperation and investment;
• Promotion of the participation of poor and vulnerable households from the Kotayk and
Gegharkunik regions in economic and community life, namely the creation of 200 new
businesses engaging women and young people; and
• Clean production in the food and chemical industries and in the mining sector.
OSCE Office
The Office focuses on support to economic criteria and incentives with the aim of forging an
economically-strong middle class that is a key factor for social stability. The Office facilitates
initiatives aimed at state support to the private sector.
In 2006, a Project Implementation Unit was opened in Kapan with the primary aim of supporting
sustainable development and poverty reduction in the region and boosting private entrepreneurship
in the rural areas.
American University of Armenia / Turpanjian Rural Development Program
The mission of this program is to promote sustainable economic development in the rural
communities of Armenia by means of crafting opportunities and making direct investments in
education. The program began in 2006 owing to an investment of US $5 million by Herald
Turpanjian. The program focuses on new job creation and business development through adult
education and entrepreneurship.
To date, centers have been created in Gyumri, Stepanakert, and Ijevan to serve the residents of the
regions.
In addition to providing applied business knowledge, the program offers financial support for
businesses to obtain loans. The program also acts as a guarantor, which allows the beneficiaries to
access loans at an average interest rate of 6 percent from the partner banks. After the loans are
approved, the program conducts monitoring and evaluation, as well.
World Bank Armenia Country Office
The World Bank Armenia country office has implemented the following projects:
• Rural Enterprise and Small-Scale Commercial Agriculture Development Project (starting from
2004);
• Enterprise Incubator Project (2007);
• Foreign Investment and Export Facilitation Project (2006); and
• Enterprise Development Project (2002).
This institution is also providing extensive support to the systemic reform of entrepreneurship in
Armenia.
11 10
12
doc_348079263.pdf
International Projects Of Sme Support In Armenia
PB
National Strategy
of Small and Medium
Entrepreneurship Development
ì³ñ³½¹³ï γñ³å»ïÛ³Ý
´Ç½Ý»ë ä³ñ»ï³ êäÀ
ܺð²ÌàôÂÚàôÜ
INTERNATIONAL PROJECTS OF SME
SUPPORT IN ARMENIA
This Paper presents the SME support projects carried out in Armenia by international organizations
during the last decade and analyzes their impact.
2
CONTENTS
Projects Implemented in Armenia ................................................................................................................. 3
Enterprise Europe Network (EEN) ............................................................................................................ 3
United Nations Development Programme (UNDP) ................................................................................ 3
“Development Cooperation” Program Implemented by the Dutch EVD Agency .................................. 3
Yerevan Office of the Organization for Security and Cooperation in Europe (OSCE) ......................... 4
German Agency for International Cooperation (GIZ) ............................................................................. 4
Black Sea Basin 2007-2013 Joint Operational Programme .................................................................. 4
Dutch Centre for the Promotion of Imports from Developing Countries (CBI) .................................... 5
Japan International Cooperation Agency ................................................................................................. 5
Eurasia Partnership Foundation (EPF) ...................................................................................................... 5
Turnaround Management Group (TAM) and Business Advisory Service (BAS)
Programs in Armenia ................................................................................................................................. 6
Activities of the Small and Medium Business Foundation ...................................................................... 6
Competitive Private Sector Armenia/CAPS (USAID) .............................................................................. 7
Chamber of Commerce and Industry of the Republic of Armenia ......................................................... 7
Gegharkunik Chamber of Commerce and Industry (GCCI) ................................................................... 8
Armenian Development Agency ............................................................................................................... 9
United Nations Industrial Development Organization (UNIDO) ........................................................... 9
OSCE Office ............................................................................................................................................... 10
American University of Armenia / Turpanjian Rural Development Program ...................................... 10
World Bank Armenia Country Office ...................................................................................................... 10
3 2
Projects Implemented in Armenia
Enterprise Europe Network (EEN)
Since 2008, the “National Center for Development of Small and Medium Entrepreneurship in
Armenia” Foundation has been the hosting partner of the EEN in Armenia as a result of a tender
announced by the European Commission for selecting partner organizations; it presently operates as
the Enterprise Europe Network Contact Point in Armenia (EENCPA). The Enterprise Europe Network,
which officially launched its activities in February 2008, brings together around 600 partner
organizations from over 50 member states, offering numerous professional business services to its
beneficiary organizations.
The EEN offers the following services:
• Enterprise support in identifying priorities for new business cooperation, market research,
and finding potential partners;
• Support to negotiations and the signing of cooperation contracts;
• Enterprise support in assessing their readiness and capacity to deal in international markets;
• Support to innovative SMEs in testing and commercialization of their initiatives; and
• Feedback and response to issues raised by enterprises.
United Nations Development Programme (UNDP)
The “Support to SME Development in Armenia” joint project of UNDP and the SME DNC of Armenia
has been implemented since 2004. Project activities have been carried out under the following
components during the last two years: “Development of SME Support Mechanisms and Capacity
Building of the SME DNC,” “Cluster Development and Improvement of the Business Knowledge and
Skills of Start-up Businesses,” “Provision of Information and Counseling Services to SMEs at the
Central and Regional Levels,” “Enhancement of the Business Knowledge and Skills of Businesses and
Implementation of a Sector Development Project in One of the Regions of Armenia,” and “Provision of
Information and Promotion Services to SMEs at the Central and Regional Levels.”
“Development Cooperation” Program Implemented by the Dutch EVD Agency
Under the Development Cooperation Program implemented by the Dutch EVD agency, the SME DNC
of Armenia has worked on engaging SMEs active in various sectors in the program since 2008.
The aim of the Development Cooperation Program is to promote business cooperation between SMEs
in the Netherlands and in various countries of the world in order to develop their business potential
and to expand the scope of their entrepreneurial activities. Presently, the Program operates in over
40 countries, including Armenia. The Program enables local SMEs active in various sectors to identify
credible Dutch partners and to establish business cooperation in the international and local markets.
4
Yerevan Office of the Organization for Security and Cooperation in Europe (OSCE)
With the support of the Yerevan Office of the Organization for Security and Cooperation in Europe,
the SME DNC of Armenia has developed and published a number of information and analytical
materials and bulletins.
In 2009, in the framework of the cooperation with the OSC Yerevan Office, the Guesthouse Cluster
Development Program was implemented in the Syunik region of Armenia, which provided relevant
training to 59 beneficiaries in the districts of Goris, Sisian, Kapan, Meghri, and Agarak. The Program
supported the elaboration of a cluster development strategy. Guesthouse marketing centers were set up.
Under this Program, a number of simplified guides, handbooks, and manuals on issues in the SME
sector were developed and published.
German Agency for International Cooperation (GIZ)
On 31 January 2011, a Memorandum of Understanding was signed between the SME DNC of
Armenia and the “Municipal and Economic Development in Armenia” Project of the (GIZ).
In view of the importance of strengthening the SME sector in Armenia as a precondition for
progressive development and social-economic stability, the Parties agreed to combine and focus their
joint efforts with a special emphasis on support to business startups and regional economic
development issues by means of capacity building of the SME Development National Center of
Armenia and providing knowledge on the CEFE (Competency Based Economies through Formation of
Enterprise) and PACA (Participatory Appraisal of Competitive Advantages) tools.
The beginning of the cooperation was marked by the launch of the training of trainers course using
the CEFE methodology, which ended in March 2011. Representatives of the regional branch offices
of the SME Development National Center of Armenia took part in the course. Under this cooperation,
the PACA tool was presented to the staff of the SME DNC of Armenia by the Gegharkunik Chamber
of Commerce and Industry in April 2011.
Black Sea Basin 2007-2013 Joint Operational Programme
From 1 June 2011 to 30 November 2012, the SME DNC of Armenia will participate, as a partner, in
the “Black Sea Tradenet Network” grant project (hereinafter “the Project”) implemented in the
framework of the Black Sea Basin 2007-2013 Joint Operational Programme.
The Project will be implemented through cooperation between seven organizations representing
Romania, Greece, Bulgaria, Armenia, and Turkey.
The main goal of the Project is to promote, by joint efforts and resources, interregional economic
cooperation, to improve access to interregional information and business support tools for
entrepreneurs and potential investors, and to build the capacity of business support providers.
Under the Program, a “Black Sea Tradenet Network” will be created with coordination by the
organizations participating in the Project. Based on the analysis of the business environment in the
participating countries, commercial atlases of the participating countries will be developed and
5 4
published. Support will be provided to the establishment of cooperation between businesses. An
online database of business proposals will be created, and other activities will be carried out. The
analysis of the business environment will focus on the following areas: legal (organization
registration, creation of a joint enterprise, and so on), investment (main investment projects of recent
years, main priorities, trends, competition policy, and so on), export/import (legislation and
requirements), business culture, sources of financing, infrastructure, and local resources of trans-
border interest.
Dutch Centre for the Promotion of Imports from Developing Countries (CBI)
With a view to supporting exports of products of enterprises operating in Armenia to the EU
countries, the SME DNC of Armenia cooperates with the Dutch Centre for the Promotion of Imports
from Developing Countries (CBI), which is one of the leading EU organizations in this sphere.
The SME Development National Center of Armenia is the partner organization for the Export
Coaching Program implemented by the CBI in 47 countries of the world.
In cooperation between the SME DNC of Armenia and the Dutch Centre for the Promotion of Imports
from Developing Countries (CBI), a seminar on “Export Marketing Strategy” was held in Yerevan for
enterprises of small and medium enterprises that are exporting or have export potential, as well as for
business service providers (BSPs). During the seminar, the participants received comprehensive
information on the export process and the EU market trends and needs. The seminars were
conducted by CBI experts with international experience.
Japan International Cooperation Agency
In 2010, the SME DNC of Armenia developed and presented to the Japan International Cooperation
Agency a technical cooperation program for “Development of Local Production and Promotion of
Local Brands.” The implementation of this project would allow studying and implementing the
Japanese experience in local economic development, as well as carrying out a pilot program with
coordination by international experts.
Eurasia Partnership Foundation (EPF)
2004
Support to small and medium business creation by creating favorable conditions for business and
establishing a dialogue between the public and private sectors. The Eurasia Partnership Foundation
supported the performance of a number of consulting activities, including the development of
mechanisms for cooperation between businesses and the state, the improvement of legislation, and
short-term awareness campaigns for improvements in the judicial, legislative, and executive
systems of government.
2005
The Eurasia Partnership Foundation supported the development of small and medium businesses in
Armenia through the development of alternative dispute resolution mechanisms. This project
included the following activities: awareness-raising campaigns alternative dispute resolution,
6
development of formal mechanisms promoting alternative dispute resolution in Armenia, capacity
building of the mediation judges, and lobbying of the legislative amendments concerning
alternative dispute resolution.
2006
The EPF, together with the Gegharkunik Chamber of Commerce and Industry, carried out the
“Effective Business” project for over 300 enterprises of the Gegharkunik region. The targeted
enterprises benefited from counseling and training support mechanisms, as well as support with
direct marketing of their products.
2008-2009
The EPF implemented a project for the development and implementation of a social responsibility
strategy in large enterprises. As a result, over 10 large enterprises of Armenia implemented more
effective policies and measures of social support.
Turnaround Management Group (TAM) and
Business Advisory Service (BAS) Programs in Armenia
The BAS program was founded in Armenia in 2003 with the EU’s financing. Over 842 BAS projects
have been implemented in Armenia, covering total financing of over EUR 5.3 million. Further
financing was provided by the Early Transition Countries Initiative (ETCF) of the EBRD, Europeaid,
Canada (CIDA), the Chinese Taipei, and USAID. BAS has undertaken 639 consulting projects,
hiring 87 (mostly local) consultants.
The projects supported by the TAM and BAS programs contain elements and examples of the
international best practice of enterprise management in areas such as improvement of
management skills, production and quality control, and marketing, which make the enterprises
more competitive and more attractive for external financing. The TAM and BAS programs support
the development of a market economy by promoting local business advisory skills.
In 2011, the European Union will extend a grant of around EUR 800,000 to finance expert and
advisory services provided to small and medium enterprises in Armenia. Around 100 business
advisory projects are to be implemented.
Activities of the Small and Medium Business Foundation
This organization has been active in the following main areas:
• Expert assessment of the business potential of the communities of Armenia, the business
environment, the effectiveness of the existing infrastructures, and the institutional obstacles
to business development;
• Development of recommendations on the business and investment environment in the
frameworks of the participatory review of the PRSP;
• Creation of a Mediation Court for extra-judicial resolution of disputes in the SME sector,
jointly with the Association of Young Lawyers of Armenia;
• Publication of the “Small and Medium Entrepreneurship against Corruption: Perceptions and
Possible Solutions” booklet; and
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• High-quality professional advice and technical and information support aimed at SME
development.
Competitive Private Sector Armenia/CAPS (USAID)
The Competitive Private Sector Armenia/CAPS project was a five-year support project funded by the
United States Agency for International Development (USAID). The project applied a cluster approach
aimed at improving the business environment and promoting cooperation between enterprises in
specific sectors.
The CAPS project worked with four of the key developing sectors of the Armenian economy:
information technologies, tourism, pharmaceuticals, and engineering services. The project supported
the development of products and services competitive in the international market, as well as the
creation of sustainable companies offering such products and services. CAPS provided technical
assistance to companies in various formats, including consulting, capacity development of business
associations, policy research and advocacy, public outreach, training of the labor force, and joint
public-private initiatives.
The project applied a cluster approach to promoting competitiveness, which was the only one among
all the initiatives aimed at developing the private sector in Armenia. The cluster consisted of all the
key stakeholders of the relevant sector: private enterprises (regardless of their size), producers,
suppliers, customers, labor force, government, professional associations, and academic, research,
and educational institutions. CAPS promoted cooperation between these stakeholders, which
benefited individual enterprises and the Armenian economy as a whole.
Chamber of Commerce and Industry of the Republic of Armenia
The Chamber of Commerce and Industry of the Republic of Armenia was formed in April 2002 on the
basis of the Republic of Armenia Law on Chambers of Commerce and Industry.
The tools used by it in the area of business support are listed below:
• Organizing the consolidated participation of Armenian businesses, enterprises, and
organizations in trade fairs and exhibitions held in Armenia and abroad;
• Organizing and conducting national exhibitions of Armenia abroad, organizing national
exhibitions of foreign countries in Armenia, and providing space indoors and outdoors for
exhibitions;
• Developing catalogs, invitations, booklets, and other promotional materials for exhibitions
organized in Armenia and abroad;
• For commending and encouraging outstanding performance results of businesses in the
national economy, the Chamber of Commerce and Industry of Armenia has set up the
“Mercury” awards, and the highest award of the Chamber, the “Gold Medal,” was instituted in
2008;
• To date, the Chamber has organized a large number of business conferences attended by
Armenian and foreign businesses, which has enabled Armenian businesses to interact with
their foreign counterparts, sign mutually beneficial contracts and agreements, and reach
understandings on future cooperation;
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• Dissemination of information on Armenian companies, projects, products, and services;
• Creation of productive business ties, export and import promotion, and investment
promotion;
• In 2006, Armenia adopted a Law on Commercial Arbitration, in accordance with which an
Arbitration Court was created in 2007 under the auspices of the Chamber of Commerce and
Industry of Armenia; and
• As an entity supporting businesses in the field of foreign trade, the Chamber of Commerce
and Industry of Armenia has the power to issue country of origin certificates.
In close collaboration with its member companies, the Chamber of Commerce and Industry of
Armenia is organizing various seminars, meetings, and workshops aimed at improving the business
environment, developing small and medium enterprises, supporting the comprehensive and
harmonious development of all forms of enterprise, and promoting free competition. The seminars
involve discussions of all the legislative amendments and additions, as well as their application
peculiarities, allowing companies to come together and to address priority issues.
Gegharkunik Chamber of Commerce and Industry (GCCI)
The GCCI was founded in 2002 with the mission of promoting and strengthening the business
community in the Gegharkunik region. The activities of the GCCI include business planning,
consulting, training courses, support to start-up enterprises (including loans from the “Successful
Beginning” foundation), and advocacy. To date, the GCCI has worked with over 1,200 businesses
and numerous other organizations.
The GCCI is presently implementing the following projects:
• Social-Economic Self-Organization in the Rural Communities: this is a three-year project the
implementation of which began in 2009. It is co-financed by the European Union and “Caritas
International Belgium.”
The goal of the project is to generate significant positive change in five rural communities of the
region by offering social and economic development possibilities with the participation of the
communities.
• Microfranchising
The main goal of the project is to create a replicable business model and to suggest that start-up
businesses create small businesses in their communities.
This project provides business training. “Zartnir” (lit. “Wake up”) computer centers have already been
created in the Gegharkunik and Tavush regions.
• Advocacy and Assistance Center
The implementation of this project began in 2009 with the support of the USAID. The Center
provides free-of-charge legal advice and support to citizens and businesses (including representation
of their interests in court), identification of systemic and procedural weaknesses, developing and
implementing reform strategies, and public awareness-raising activities.
• Small and Medium Enterprise Support Program
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The activities in this area are mainly concentrated in the following area:
• “Successful Beginning” long-term course and consulting program/microfranchising.
“Successful Beginning” is a campaign for setting up a new enterprise, which is aimed at supporting
and guiding viable start-up businesses.
To implement this program, the Local Economic Development component pursues the goal of
creating a sustainable system of SME support through the following:
• Creating a network of trainers and experts;
• Continuous development of opportunities for partners;
• Creation of start-up businesses in various communities of Armenia; and
• Raising awareness of the program.
The PACA tool introduced by the GCCI and the ProSME makes up the methodological foundation of
community economic development and is a participatory tool.
Armenian Development Agency
The Armenian Development Agency (“ADA”) closed joint-stock company was created in April 1998
by the Government of Armenia. The goal of the ADA is to support the attraction of foreign direct
investments and to promote exports.
The ADA is a “one stop shop” agency that supports investors in doing business in Armenia and acts as
a bridge between businesses and state bodies. The ADA discovers the sectors of the Armenian
economy that are attractive for investments, promotes investments in such sectors, and protects the
interests of investors.
The services of the ADA include:
• Provision of comprehensive information (preparing an information package meeting the
expectations of foreign investors);
• Organization of site visits (planning site visits of potential investors, making the necessary
arrangements with private and public organizations, and organizing the visit to the
investment site, including airport pick up, interpretation, and support in choosing a site);
• Identification of an agent for business cooperation in Armenia;
• Follow up support (support to follow up visits and preparation of additional information and
paperwork);
• Implementation of investment projects (company registration support, staffing, job
interviews, and interviews); and
• Establishing links with government bodies.
United Nations Industrial Development Organization (UNIDO)
UNIDO helps Armenia to promote the following sectors:
• Development of the private sector, with a focus on export consortia and corporate social
responsibility;
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• Capacity building of the Armenian Development Agency to discover possibilities of business
cooperation and investment;
• Promotion of the participation of poor and vulnerable households from the Kotayk and
Gegharkunik regions in economic and community life, namely the creation of 200 new
businesses engaging women and young people; and
• Clean production in the food and chemical industries and in the mining sector.
OSCE Office
The Office focuses on support to economic criteria and incentives with the aim of forging an
economically-strong middle class that is a key factor for social stability. The Office facilitates
initiatives aimed at state support to the private sector.
In 2006, a Project Implementation Unit was opened in Kapan with the primary aim of supporting
sustainable development and poverty reduction in the region and boosting private entrepreneurship
in the rural areas.
American University of Armenia / Turpanjian Rural Development Program
The mission of this program is to promote sustainable economic development in the rural
communities of Armenia by means of crafting opportunities and making direct investments in
education. The program began in 2006 owing to an investment of US $5 million by Herald
Turpanjian. The program focuses on new job creation and business development through adult
education and entrepreneurship.
To date, centers have been created in Gyumri, Stepanakert, and Ijevan to serve the residents of the
regions.
In addition to providing applied business knowledge, the program offers financial support for
businesses to obtain loans. The program also acts as a guarantor, which allows the beneficiaries to
access loans at an average interest rate of 6 percent from the partner banks. After the loans are
approved, the program conducts monitoring and evaluation, as well.
World Bank Armenia Country Office
The World Bank Armenia country office has implemented the following projects:
• Rural Enterprise and Small-Scale Commercial Agriculture Development Project (starting from
2004);
• Enterprise Incubator Project (2007);
• Foreign Investment and Export Facilitation Project (2006); and
• Enterprise Development Project (2002).
This institution is also providing extensive support to the systemic reform of entrepreneurship in
Armenia.
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