Lack of capital, human talent to stall SME ‘engines of growth’

Leaders of SMEs that the EBRD sees as the “engines of growth” have voiced fears that obstacles such as lack of capital and opaque policies will stymie the bank’s vision for a highly profitable sector

The small and medium sized enterprises (SMEs) that EBRD president Sir Suma Chakrabarti has identified as “the engines of an economy” were complaining on Thursday about problems with human talent, opaque policy and inconsistent availability of capital.

Their concerns are numerous, even among companies that have thrived in the region. “The biggest obstacle to the private sector is the availability of capital,” said Vaja Jhashi, president and CEO of Trans Oil group, an agricultural commodity leader in the Back Sea region.

“You can have all the vision, all the business plans in the world, but if you don’t have money to go with it and support from financial institutions it’s not going to work. You have the car but you don’t have the gas,” he said.

Ruben Vardanyan, founder and chairman of RVVZ Foundation, a philanthropic body, bemoaned the lack of long-term commitment to education in the region, both in terms of vision and execution. “Unfortunately, it does not exist in most of the countries we are talking about today,” he said.