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12«ШНЮШУМ-ЛОУШаИ» #28(187), 2023 / ECONOMIC SCIENCES_37
Галандарова Уммухабиба Махаммадтаги
к.э.н., доцент
Бакинский Государственный Университет DOI: 10.24412/2520-6990-2023-28187-37-39 ЗНАЧЕНИЕ МЕЖДУНАРОДНЫХ ФИНАНСОВЫХ ИНСТИТУТОВ В ПОДДЕРЖКЕ МАЛЫХ И СРЕДНИХ ПРЕДПРИЯТИЙ (МСП) В РАЗВИВАЮЩИХСЯ СТРАНАХ
Galandarova Ummuhabiba Mahammadtaghi
Phd, Associate Professor Baku State University
THE SIGNIFICANCE OF INTERNATIONAL FINANCIAL INSTITUTIONS IN SUPPORTING SMALL AND MEDIUM ENTERPRISES (SMES) IN DEVELOPING COUNTRIES
Аннотация
В этой статье исследуется ключевая роль международных финансовых институтов (МФИ) в поддержке малых и средних предприятий (МСП) в развивающихся странах. МСП, часто являющиеся источником жизненной силы развивающихся стран, вносят существенный вклад в созд ание рабочих мест, экономический рост и сокращение бедности. МФИ, в состав которых входят такие организации, как Всемирный банк и Международный валютный фонд, признали значение МСП в процессе развития и сформулировали стратегии поддержки их роста. На основе всестороннего изучения связи между МСП и экономическим развитием статья завершается призывом к постоянной поддержке и совершенствованию мер вмешательства МФИ в отношении МСП в развивающихся странах. Поддерживая рост и устойчивость МСП, МФО играют решающую роль в укреплении экономической стабильности, сокращении неравенства и достижении глобальных целей развития.
Abstract
This article explores the pivotal role of International Financial Institutions (IFIs) in bolstering Small and Medium Enterprises (SMEs) in developing countries. SMEs, often the lifebloodof emerging economies, contribute substantially to job creation, economic growth, and poverty alleviation. IFIs, comprising entities such as the World Bank and the International Monetary Fund, have recognized the significance of SMEs in the development process and formulated strategies to support their growth. Through a comprehensive examination of the connection between SMEs and economic development, the article concludes by advocatingfor continued support and improvement in IFI interventions for SMEs in developing countries. By nurturing the growth and sustainability of SMEs, IFIs play a crucial part in fostering economic stability, reducing inequalities, and advancing global development goals.
Ключевые слова: малые и средние предприятия (МСП), международные финансовые институты (МФИ), развивающиеся страны, экономическое развитие, финансовая помощь, устойчивость.
Keywords: small and medium enterprises (SMEs), international financial institutions (IFIs), developing countries, economic development, financial assistance, sustainability
Introduction
Small and Medium Enterprises (SMEs) play a pivotal role in the economic landscape of developing countries. These businesses are often considered the backbone of emerging economies due to their significant contributions to employment generation, economic growth, and poverty reduction. In tandem with the crucial role of SMEs, International Financial Institutions (IFIs) have emerged as key players in supporting and catalyzing the growth and sustainability of these enterprises [2, p.18].
SMEs in developing countries are a diverse group, encompassing a wide range of industries and sizes. These enterprises typically employ a limited number of employees and possess modest financial resources. They represent a substantial portion of the business sector in many developing countries, and their contributions are multifaceted [2, p.20].
First and foremost, SMEs are known for their ability to generate employment opportunities. In countries where larger corporations are less prevalent, SMEs are
often a source of livelihood for many. This characteristic is pivotal in addressing unemployment and poverty, thereby fostering economic and social stability.
In addition to job creation, SMEs stimulate economic growth. Their agility, adaptability, and capacity for innovation make them vital contributors to local and national economic development. These enterprises drive competition, encourage entrepreneurship, and facilitate the creation of new markets, thereby invigorating the economic landscape.
Despite their significance, SMEs in developing countries face numerous challenges and obstacles that hinder their growth and sustainability. Some of the most common challenges include limited access to finance, bureaucratic and regulatory barriers, a lack of technical and managerial skills, limited market access, and vulnerability to economic shocks.
The vital role of SMEs in developing countries. Small and Medium Enterprises (SMEs) are a diverse group of businesses in developing countries, often characterized by their limited employee count, modest financial resources, and various sectoral engagement.
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They are typically classified into three main categories: micro-enterprises, small enterprises, and medium-sized enterprises, with each category defined by factors like the number of employees and financial thresholds [1, p.175].
SMEs are indispensable catalysts for economic growth and employment. They serve as vital job creators, employing a significant portion of the population, especially in areas with limited large corporations. Their ability to innovate, adapt, and foster competition stimulates local and national economic development. SMEs contribute to diversifying the economy, reducing vulnerability to external shocks, and fostering regional development by operating across a range of sectors and often establishing themselves in rural or less -developed regions.
Despite their crucial role, SMEs face a host of challenges [1, p.175]. Limited access to finance, bureaucratic hurdles, a lack of skills and training, restricted market access, and vulnerability to economic fluctuations are among the common obstacles that hinder their growth and sustainability. Overcoming these challenges is pivotal to harnessing the full potential of SMEs as engines of economic progress in developing countries.
International Financial Institutions. International Financial Institutions (IFIs) are global organizations established to provide financial and technical assistance to countries, particularly those in the developing world. These institutions play a critical role in fostering economic stability, reducing poverty, and promoting sustainable development. They offer financial support, technical expertise, and policy guidance to member countries, often with the aim of alleviating economic challenges and facilitating growth [3, p.26].
IFIs include a diverse array of organizations, with each playing distinct roles :
• The World Bank: Comprising two institutions, the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), the World Bank focuses on long-term development projects, poverty reduction, and infrastructure development.
• The International Monetary Fund (IMF): Primarily concerned with macroeconomic stability, the IMF provides financial assistance and policy advice to countries facing balance of payments issues and economic crises [5, p.29].
• Regional Development Banks: These institutions, such as the Asian Development Bank, African Development Bank, and Inter-American Development Bank, work within specific regions to support economic and social development, often focusing on infrastructure, education, and healthcare.
The overarching mission of IFIs is to promote global economic stability and reduce poverty. They aim to achieve these objectives by providing financing for development projects, technical assistance to improve governance and institutions, policy advice to member countries, and capacity-building programs. IFIs strive to create conducive environments for sustainable economic growth, reduce inequalities, and ensure that economic development is inclusive and environmentally
sustainable. Their efforts are critical in addressing global challenges and facilitating progress in developing countries.
Supporting SMEs through IFIs. International Financial Institutions (IFIs) play a pivotal role in supporting Small and Medium Enterprises (SMEs) in developing countries through various financial assistance and funding programs. These programs often include loans, grants, and credit facilities. IFIs provide financial resources to governments and financial institutions, which are then directed toward SMEs. These funds can be used for various purposes, such as business expansion, innovation, and capacity-building. The support ranges from start-up capital to working capital loans and even equity investments, facilitating SME growth and resilience in challenging economic environments [7, p.8].
IFIs offer more than just financial aid. They provide technical expertise, training, and capacity-building programs aimed at enhancing the skills and capabilities of SMEs. These initiatives can include training in areas like financial management, marketing, technology adoption, and governance. Technical assistance equips SMEs with the tools and knowledge needed to navigate the complexities of the modern business landscape, promoting long-term sustainability.
IFIs work closely with governments to advocate for policy reforms that create a conducive environment for SMEs to thrive. They encourage changes in regulations that simplify business registration, improve access to credit, and enhance the overall business and regulatory framework. IFIs also offer institutional support to strengthen local financial institutions and business support organizations, enhancing their ability to serve SMEs effectively [8, p.434].
Case studies. In demonstrating the tangible impact of International Financial Institutions (IFIs) on Small and Medium Enterprises (SMEs) in developing countries, specific projects and initiatives stand as noteworthy examples of successful collaboration. These case studies underscore the pivotal role IFIs play in empowering SMEs and fostering economic growth.
One notable instance is the "Small and Medium Enterprise Program"' initiated by the International Finance Corporation (IFC), a part of the World Bank Group. This program has been instrumental in supporting SMEs in various developing nations, providing financial resources, technical assistance, and capacity-building programs. The IFC's engagement in regions like Sub-Saharan Africa has seen SMEs accessing credit lines, expanding their operations, and creating jobs, thus contributing significantly to the local economies [6].
Another exemplary case is the Asian Development Bank's (ADB) involvement in the "Women in Business" program in Southeast Asia. ADB has partnered with local financial institutions to provide financing, training, and mentorship to women-led SMEs. This initiative has not only empowered female entrepreneurs but also stimulated economic growth in the region through the creation of SMEs led by women, who previously faced barriers to accessing capital and support [4, p.10].
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These cases exemplify how IFIs' financial assistance, technical expertise, and policy advocacy have translated into tangible benefits for SMEs, propelling them towards success, stimulating economic development, and fostering sustainability in developing countries.
Conclusion. Small and Medium Enterprises (SMEs) are the linchpin of economic development in developing countries, driving employment, innovation, and resilience. International Financial Institutions (IFIs) play an indispensable role in empowering these vital contributors. Their financial assistance, technical guidance, and policy advocacy are instrumental in enhancing SMEs' growth and sustainability.
As we reflect on the significance of SMEs and the role of IFIs, we are reminded of the pivotal connection between these enterprises and economic progress. To ensure the continued growth and prosperity of SMEs in developing countries, there is a pressing need for sustained support and the constant improvement of IFI interventions. We must remain committed to creating environments where SMEs can thrive, promoting economic stability and reducing poverty on a global scale.
References
1. Al-Haddad, Lara & Sial, Muhammad & Ali, Imdad & Alam, Rahmat & Khuong, Nguyen & Khanh, Thai. (2019). The Role of Small and Medium Enterprises (SMEs) in Employment Generation and Economic Growth: A Study of Marble Industry in
Emerging Economy. International Journal of Financial Research. 10. 174.10.5430/ijfr.v10n6p174.
2. Berisha, Gentrit & Pula, Justina. (2015). Defining Small and Medium Enterprises: a critical review. 1. 17-28.
3. Bradlow, Daniel & Hunter, David. (2010). Introduction: International Financial Institutions and International Law.
4. Emerging Lessons on Women's Entrepreneurship in Asia and the Pacific. Case Studies from the Asian Development Bank and The Asia Foundation, 2018
5. Gyimah, Adjei & Agyeman, Annette. (2019). A Study on How Development Finance Institutions Support SMEs: A Case Study of International Finance Corporation. International Journal of Financial Research. 10. 27. 10.5430/ijfr.v10n2p27.
6. IFC Study Identifies Best Practices to Help Banks Improve Services for Small and Medium Enterprises
https://pressroom.ifc.org/all/pages/PressDetail.as px?ID=24171
7. Report on Support to SMEs in Developing Countries Through Financial Intermediaries. Dalberg, November 2011.
8. Seo, J.-Y. (2017). A Study of Effective Financial Support for SMEs to Improve Economic and Employment Conditions: Evidence from OECD Countries. Managerial and Decision Economics, 38(3), 432-442. https://www.jstor.org/stable/26608124
УДК: 338.242.2
Мангибаева ДД. к.э.н., и.о. ассоциированный профессор Каспийский университет технологий и инжиниринга им. Ш. Есенова
DOI: 10.24412/2520-6990-2023-28187-39-43 ПОТЕНЦИАЛ РАЗВИТИЯ ИНСТРУМЕНТОВ ЗЕЛЕНОГО ФИНАНСИРОВАНИЯ В
РЕСПУБЛИКЕ КАЗАХСТАН.
Mangibaeva D.D.
Ph.D. in Economics, Acting Associate Professor Sh. Yesenov Caspian University ofTechnology and Engineering
THE POTENTIAL FOR THE DEVELOPMENT OF GREEN FINANCING INSTRUMENTS IN THE
REPUBLIC OF KAZAKHSTAN.
Аннотация
В условиях глобального изменения климата и необходимости сохранения природных ресурсов, инвестиции в устойчивые и экологически чистые проекты становятся все более важными. Инструменты зеленого финансирования создают возможности для финансирования таких проектов и способствуют достижению углеродной нейтральности и более экологичного будущего.
Республика Казахстан, обладающая обширными природными ресурсами и амбициозными целями в области устойчивого развития, стоит перед вызовом снижения углеродных выбросов и перехода к углеродной нейтральности. В статье исследуется потенциал развития «зеленого» финансирования в республике и способы привлечения инвестиций в «зеленый» бизнес. В статье анализируются различные виды «зеленых» проектов, рекомендуются наиболее эффективные финансовые инструменты, а также механизмы государственной поддержки и стимулирования.
Abstract
In the context of global climate change and the need to conserve natural resources, investments in sustainable and environmentally friendly projects are becoming increasingly important. Green finance instruments create opportunities for financing such projects and contribute to achieving carbon neutrality and a greenerfuture.
The Republic of Kazakhstan, which has vast natural resources and ambitious sustainable development goals, is facing the challenge of reducing carbon emissions and transitioning to carbon neutrality. The article examines
