Role and Importance in the Development of Economy of the Republic of Srpska and Bosnia and Herzegovina Through Business Operations of Small and Medium-Sized Enterprises

Abstract

Small and medium-sized enterprises have special importance in countries in transition such as the Republic of Srpska and Bosnia and Herzegovina. The largest number of enterprises both in the EU and in the Republic of Srpska and Bosnia and Herzegovina fall under this sector and it is precisely this sector that forms an axis for initiating economic development. Small and medium sized enterprises represent the backbone of development in the majority of countries, however, in the Republic of Srpska and Bosnia and Herzegovina its development is, unfortunately, very much restricted. It is specifically this sector that is one of the key generators of a country’s development and economic growth. The importance of small and medium-sized enterprises in transition economies such as the Republic of Srpska and Bosnia and Herzegovina, with poor economic growth and high unemployment rate, is even bigger. One of the criteria Bosnia and Herzegovina must fulfil in order to become a member of the EU also includes functional market economy and economic capacities capable of coping with the competition and the conditions that reign in the EU market. Progress in fulfilling this criterion can be achieved specifically through the development of small and medium-sized enterprises.
It is clear that the European Union has as its goal to create the most competitive and dynamic economy in the world that will be based on knowledge, will be capable of sustainable development, of creating better quality jobs and of strengthening social cohesion.
We are very much aware of the fact that small and medium-sized enterprises are the triggers of innovations and new technologies, source of new jobs and that they play the lead role in cross-border connections, a basis of economic development and at the same time of the development of Bosnia and Herzegovina. Having regard to the problems of development of the Republic of Srpska and Bosnia and Herzegovina, the main hypothesis for development will have to be sought through the development of small and medium-sized enterprises.
The development of small and medium-sized enterprises in the Republic of Srpska and Bosnia and Herzegovina that will be offered at the market through good quality domestic products will influence to a large extent the increase of level of their consumption, by raising citizens’ awareness about purchasing domestic products, and will have positive effects on fluctuations of unemployment rate in the Republic of Srpska and Bosnia and Herzegovina, just like on our country’s competitiveness in global business conditions.