Development Agencies, Grant System, and Financial Support for SMEs in Turkey

Development Agencies, Grant System, and Financial Support for SMEs in Turkey

Hasan Dinçer (Istanbul Medipol University, Turkey), Ümit Hacıoğlu (Istanbul Medipol University, Turkey) and Abdullah Önder Özkul (Beykent University, Turkey)
Copyright: © 2015 |Pages: 21
DOI: 10.4018/978-1-4666-7308-3.ch011

Abstract

SMEs form 90% of commercial businesses in Turkey and the support given to SMEs means support directly given to the real sector in a vast scale. SMEs have some problems currently that are accepted as structural throughout Turkey, such as that they were constituted in form of family companies, that they do not use financial instruments sufficiently, that they do not work with professional executives, their commercial activities without invoice, etc. There could be other common problems that SMEs can meet with as related to sector or location. The main duties of Development Agencies is to mobilize commercial potential in region, to support sectors that have the potential to grow, and thus, to decrease the difference of development between regions. This chapter explores SMEs in Turkey.
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Literature Review

Main important developments observed in World economy regarding regional development and economical geography is the fact of localisation tendencies in economy and urban economies. While experienced developments in communication, transport, technology in the process experienced decreases importance of traditional parameters of settlement theory such as raw material and proximity to markets, it becomes possible that a product produced at any region of the world is able to be sold in any region of the world. (Kaya, 2007)

Development process is the result of acquisitions that countries obtained from historical process they passed. Institutional infrastructure of countries in historical process has a big share in forming of their institutional structures today. Tabellini suggests in his study that beside that institutional culture is formed by the effects of institutional culture, regional development is also in a firm correlation with past in the same way. In the same way it is suggested that with the reason of low labour force efficiency, economically disadvantaged regions cannot advance through income transfer, that poor regions in terms of economy and culture need to benefit from education investment, from cheap financing source born with local initiative and from localization of government. (Tabellini, 2014)

The sensibility of economy management in Turkey to manage and decrease debt stress of country has lead that the fact of growth remained at the second plan. Rational distribution of sources relevant with the concept of growth and productivity in production cannot be ensured. That Turkey adopts growing depending on production and efficiency as a strategy is urgent. With this reason, necessary regulations to make performance of growth stable in short term is needed. Sufficient condition is the establishment of R&D and industrial infrastructure based on human capital as a requirement of definition of sustainable growth. (Yiğidim, 2012)

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