Small companies can get money from Brussels more easily

Montenegro will receive a National Agency for the Development of Small and Medium-sized Enterprises (SMEs), which will be responsible for implementing economic support programs and will be the intermediary body for managing future European Structural and Investment Funds (ESIF).

The preparation and establishment of this Agency is being carried out by the Ministry of Economic Development in cooperation with the Delegation of the European Union, with the expectation that the Agency will start operating in 2027 and reach full capacity a year later. The establishment of the Agency is part of the negotiating chapter 22 (Regional Policy and Coordination of Structural Instruments).

This modern practice exists in European Union countries and includes not only grants but also assistance in the development of digital services, exports, advisory services, and green business.

In Montenegro, current support to this sector is fragmented across multiple institutions with insufficiently coordinated programs, so assistance is often not effective enough.

The Ministry of Economic Development explains that, within the framework of the EU project "Advanced Business Development Services for Improving the Capacities of SMEs in Montenegro", a feasibility study was developed to define the best model for establishing a national SME Agency in Montenegro, through the analysis of various institutional solutions and assessment of their applicability, with the aim of improving the support system for small and medium-sized enterprises.

The Ministry states that Montenegro already participates in several EU programs, from the previous CIP to current ones such as the "Single Market Program", "Western Balkans Investment Framework" and "Horizon Europe", but that analyses show that there is significant room for better use of available money and more efficient coordination of support for the SME sector. Therefore, the establishment of an umbrella agency is planned, along with the development of a network of regional structures, in order to strengthen the capacities for program implementation and better connect national and European support instruments.

"The establishment of the Agency is of particular importance in the context of the future management of the European Structural and Investment Funds (ESIF) after EU accession. Within the framework of the negotiation process for Chapter 22, the efforts of the Ministry of Economic Development are aimed at creating and improving administrative capacities for the management of EU funds for small and medium-sized enterprises, including the European Regional Development Fund and EU financial instruments on the path to the EU. These funds will be key for financing projects related to various priorities of the SME sector together with the Reform Agenda. In this context, the MED should also work on harmonizing its institutional framework to ensure the proper management of these funds when they become available, while separating strategic from operational work," the Ministry emphasized in the documentation on the establishment of this agency.

The Ministry explains that the current system of support for small and medium-sized enterprises is fragmented, with multiple institutions with similar responsibilities and insufficiently coordinated programs, which is why assistance to the economy is often not efficient enough. As they state, the formation of a special agency would clearly separate who makes rules and strategies and who implements them in practice, which would enable faster, more transparent and more organized support for enterprises, modeled on the practice of European Union countries.

"Montenegro has been participating in EU programmes from the CIP period to current instruments such as the "Single Market Programme", "Horizon Europe" and "Western Balkans Investment Framework". However, an analysis of the implementation so far indicates that there is room for significant improvement in the absorption of available funds, especially in the segment of direct support to the MSME sector. The establishment of a national Agency would contribute to strengthening capacities for the preparation, management and implementation of projects, systemic support to companies in accessing EU instruments, integration of national and EU support programmes, gradual preparation for the management of the European Structural and Investment Funds (ESIF) after EU accession", explained the Ministry of Economic Development.

The Ministry states that modern support for small and medium-sized enterprises goes beyond traditional aid schemes and is not limited to grants, but includes a combination of financial support, advisory services, support for exports, innovation, digitalization and green business. Such an approach, they explain, requires a flexible and professionally trained institution that can monitor market needs and adjust programs, which is why the agency model is more efficient and practical than classic administration.

"SMEs in Montenegro are territorially dispersed, while development services are predominantly concentrated at the central level. This structure limits the availability of support to businesses in less developed municipalities. Establishing an Agency with a functional network of regional centers would enable equal territorial availability of development services, direct communication and work with businesses, rapid identification of local development needs and stronger coordination with local governments and business zones. This contributes to regional cohesion and balanced economic development," the Ministry states.

The Ministry states that comparative practice shows that all European Union countries and developed economies have a central institution that implements support programs for small and medium-sized enterprises, such as agencies in Ireland, France, Croatia and Slovenia.

"The National Agency for MSMEs would have a direct impact on increasing the productivity and competitiveness of the sector, a higher rate of survival and growth of enterprises, growth of exports and internationalization, strengthening of innovation capacity, improvement of the investment environment. This directly contributes to the goals of economic growth, employment, fiscal stability and acceleration of the European integration process," the Ministry states.

Regional centers throughout the country

It is planned that the Agency will have a network of regional centers that will enable equal availability of services throughout the territory of Montenegro, direct contact with companies and local communities, rapid identification of MSME development needs, coordination with municipalities, business zones and private partners.

"Regional centers operate under the operational coordination of the Program Directorate at the central Agency, ensuring a unified policy and standardized quality of services," the Ministry states.