European Union and EBRD pledge financial support to small businesses in Turkey

By EBRD  Press Office

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The European Union (EU) and the EBRD are stepping up their efforts to support the growth of small and medium-sized enterprises (SMEs) in Turkey with a new €2.5 million grant financing that will enable Turkish companies to benefit from high-quality advisory services.

The funding provided by the EU will be used to help Turkish SMEs to improve their operational efficiency, boost competitiveness and fulfil their growth potential with the support of the EBRD’s Small Business Support (SBS) programme.

The small business sector represents a key driver of the Turkish economy, providing around 80 per cent of the country’s employment. Supporting the development of small and medium companies in Turkey, particularly in remote regions, is one of the EBRD’s strategic priorities.

The EBRD’s SBS programme promotes best business standards and improves SME management skills such as planning, production, quality control and marketing. SBS projects help small businesses become more competitive, enabling them to attract external financing. Together with the development of local business consultancy skills, SBS contributes to the development of the sustainable market economy.

The EBRD’s Small Business Support programme includes two components - the Business Advisory Services (BAS) and the Enterprise Growth Programme (EGP).

BAS was launched in 1995 and is designed to assist individual enterprises to engage with local consultants on specific projects with a rapid payback. In addition, BAS carries out market development activities to develop the capacity of SMEs and local consultants. BAS addresses the issues of management effectiveness, management quality and market performance improvement, and cost reduction.

BAS Turkey expects to fund 40 projects in 2012, of which 15 have already been approved. The clients have come mainly from sectors such as food and beverages, manufacturing and retail distribution.

The objective of EGP, started by the Bank in 1993, is to support the further development and growth of SMEs through the implementation of structural changes, the development of new business skills at senior management level and the introduction of best international practices. EGP’s advisory services are provided by experienced directors, industry experts and financial specialists.

EGP has been active in Turkey since 2010 and intends to fund 14 projects by end 2012, in various sectors of the economy, of which 12 are currently under way. A number of EGP clients are transforming themselves into international companies that play significant roles in their respective industries.

In addition to working with Turkish small businesses, the EBRD is engaged in active policy dialogue and cooperation with relevant ministries, SME development agencies, investment promotion and regional development agencies, as well as regional chambers of commerce, which will play an important role in the successful and demand-led implementation of Small Business Support.

Since the beginning of the EBRD’s operations in Turkey, the Bank has invested over €1.5 billion in various sectors of the country’s economy, mobilising additional investment in excess of €3 billion.

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