In recognizing Global Entrepreneurship Week, I’d like to recall one of CIPE’s more comprehensive and successful programs to address private sector development.
During the late 90’s Montenegro was an isolated corner of the Balkans, cut off from outside investment due to long-standing sanctions against the Milosevic regime, and reliant on smuggling to fuel it’s economy. Montenegro’s private sector was small and limited to a few service-oriented companies in the capital city and resort towns which dotted its coast. The country was saddled with a plethora of communist-era laws which discouraged enterprise formation, and promoted informal economic activity. There were no shortage of entrepreneurs in this small country, but due to government roadblocks and lack of support services they weren’t making it to the market.
Recognizing the need to help entrepreneurs enter the economy, Montenegro’s Center for Entrepreneurship and Economic Development (CEED) teamed with CIPE on a long-term project to develop a strong entrepreneurial sector. Working with USAID support, CEED and CIPE developed a multi-pronged strategy that sought to create sustainable institutions that would provide services directly to entrepreneurs while constructively engaging policy-makers on needed reforms. Courses were held around the country providing would-be entrepreneurs with the “ABC’s” of starting a business, business majors at University were engaged to help others develop business plans for financing, and consulting services were developed to assist entrepreneurs further develop their businesses.
On the policy side, CEED/CIPE developed a series of surveys and studies that helped identify the main barriers faced by entrepreneurs, including a business registration process which required a $2,500 deposit, and several months worth of bureaucratic drudgery. CEED successfully pushed the government to enact a new business registration law which virtually eliminated registration fees, and dramatically simplified and shortened the registration process. As a result the number of registered businesses in Montenegro quadrupled virtually overnight.
To build on this momentum CEED and CIPE worked together to organize Montenegro’s entrepreneurs into the “Montenegro Business Alliance” (MBA). To this day the MBA remains the country’s most influential business group, it’s annual National Business Agenda has been responsible for significant reform initiatives such as the introduction of a 10% flat tax.
To-date both CEED and the MBA remain powerful influences in a country now recognized for its entrepreneurial spirit, it’s hard to imagine where Montenegro would be headed without their leadership and contributions.
Published Date: November 20, 2008