SMALL AND MEDIUM-SIZED ENTERPRISES AS AN INFLUENTIAL FACTOR TOWARDS THE ECONOMIC GROWTH OF COUNTRIES WITH TRANSITION ECONOMIES

This paper argues the potential of small and medium sized enterprises to stimulate sustainable economic growth for transition countries. Firstly, the article discusses that SMEs are more successful tool to accelerate job creation process and to distribute economic resources efficiently. SMEs' flexibility is also mentioned as a key characteristic that allows them to adapt quickly to the changes in market and institutional conditions. Then, we stress on the SMEs capability to deepen the technological diffusion, which can be crucial for developing countries' economic prosperity. It is also shown that, competitive markets, as an essential determinant of sustainable economy, can be achieved only by the high presence of SMEs. And this competition can bring the innovative production and management strategies and cost-efficiency to the economies of developing countries. Finally, the paper introduces the necessary policy steps that governments of developing countries must follow to enhance the competitiveness and efficiency of the SMEs and to create a satisfactory business environment for them.