Entrepreneurship, innovations and local economic development – the case of the Republic of Macedonia

Abstract

The authors of this paper address the importance of small and medium size enterprises (SMEs), entrepreneurship and innovation for the local economic development in Macedonia. The analysis in our paper identifies the main challenges and priorities for the development of a dynamic SME sector and qualitative entrepreneurial processes in Macedonia. Such challenges and priorities can be "located" in the following areas: first, improvement of certain key segments of the investment climate and especially - abandoning the practice of involvement of politics in business, raising the quality of the local infrastructure and facilitating the access of SMEs to resources for financing their growth; second, building the capacity of the local governments for transformation; third, increasing the capacity of the business sector for introducing innovations, which present the main source of differentiation of products and services of companies compared to their competition, i.e. for enhancing the competitiveness of companies and for achieving economic profits and a more dynamic growth.