Business environment, competitivenEss and innovation among SMEs in Albania

Abstract

Micro and small and medium enterprises make an important contribution to the economic development of Albania. Due to globalization and EU integration process, business environment in our country is becoming more and more complex and SMEs have to undertake proper actions in order to compete at national and international markets. Under these circumstances, more attention should be paid to innovation as the main tool to remain competitive in a globalized world. This paper aims to provide a descriptive analysis of SMEs sector in Albania focusing on their contribution to the national economy as well as at the status of Albania and its SMEs with regard to competitiveness and innovation. The data used were mostly retrieved from Doing Business, Global Competitiveness Indexes (GCI) & Global Innovation Indexes (GII) and Albanian Institute of Statistics (INSTAT). Over the last years significant progress is made toward the establishment of the proper business environment for SMEs. Government policies and initiatives seem to have produced concrete results with regard to some specific indicators of Doing Business such as paying taxes, while in terms of innovation more efforts need to be put either by the government or by the same SMEs in the country in order to improve innovative capabilities. Despite some initiatives towards the establishment of proper infrastructure to enterprise innovation, this latter remains weak and Albanian SMEs still lack funds for innovation, and skilled workers.