The Business Environment and Problems of Small and Medium Enterprises in Kosovo

A good business environment means a catalyst for small and medium enterprises, a good business environment facilitates development and sustainability of small and medium enterprises. The development of micro, small and medium enterprises (MSME) is very important to the economic development of a country, and intentionally, MSMEs are considered to be amongst the most efficient instruments for economies in transition, because of their production of sustainable economic growth, employment and poverty reduction. Small and medium enterprises are a generator of new products and technologies; they are are a source of new ideas and advanced strategies of management. Development and sustainability of small and medium enterprises depends on the business environment, which implies a series of social, legal, economic, political or institutional conditions, which are uncontrollable in nature, and affect the organizations’ functions. This study addresses the baseline documents which were taken into consideration by the Government of the Republic of Kosovo in developing economic policies, thereby analysing their advantages and disadvantages. By analysing reports, statistics on MSMEs and other documents, and further complementing the study by a research section (business survey), this paper aims at identifying the key problems faced by the MSMEs in Kosovo, and provide adequate recommendations which may be of service in resolving such problems, but also resulting into a better business environment, and economic development in general.