Italian Local Governments and Costs Control

The SME sector has unquestionably progressed in the years since the collapse of collapse of Communism and central planning. The initial surge of new entrants in the period 1990-1993 - overwhelmingly in the trading, importing and petty services sectors - has now subsided. The early and easy opportunities for high profits have now effectively all been found, exploited and competed away. Many prospective entrepreneurs are now setting up in more sophisticated ventures involving high levels of capital investment, technology and skills. This is a positive development for the future of Central and Eastern Europe. At the same time, new strategic policies are increasingly coming into view. But in spite of improved environment for SMEs, and the successes in SME development so far, there remains an enormous challenge for Eastern European governments to grasp. This is to use SME development not simply as a peripheral economic policy, but to base their development strategy far more around the potential offered up by SME development. There is much evidence that other countries, in similar circumstances to those which still prevail in Central and Eastern Europe, have been able to promote rapid economic development through a very strong focus upon SME development. The Albanian private sector during the last years is demonstrating itself as the most dynamic part of the economy. Small and medium sized enterprises in construction, production, services, trade, and transport prevailing in private sector are continuously generating new opportunities for employment, around 215,000 new jobs. There are around 62,000 active enterprise that operate in Albanian economy. Almost all enterprises in Albania can be defined as SMEs (only 0.2% of companies have more than 100 employers). About 48% of companies of the country have an annual turnover of $ 50,000 and 38% make $ 125,000 annually. The government policy toward development of the private sector is by definition SME policy. SMEs give a considerable contribution in GDP. About 79% of them have sufficiently qualified management, but they still feel they need managerial qualification, considering the technical and economic qualification as sufficient. 74 % of them are ready to pay for this. It is more difficult to find qualified persons mainly in construction and production, and less in transport and trade. 61% of SMEs use second hand machinery but in good condition. In the service sector 31% of the machinery is new, while in production only 16% of it is new. They have a permanent and systematic quality control that covers 93% of activities in construction, and 94.8 % in production sector. In average, 85% of all SMEs have a permanent quality control. But, Albanian SME's product still cannot be competitive with the imported goods. Quality remains Akilee's heel, that doesn't give a real competing power to the SMEs even in comparison with big companies that operate in the country. About 44.6 % of them perform activity to protect environment. About 87 % make use of electric energy, while none of them knows the solar energy. 65% of the construction SMEs, 62 % of production, 86 % of transport buy in the national market, and at least 80 % of "product" of every sector is sold nationally. 78 % of them are national. Considering all their possibilities, still 94% of SMEs feel to constraints to competitiveness. These come mainly from: unequal enforcement of laws and regulations; unfavorable business legislation and regulations; corruption; unfair