During its session on August 27, 2020, the RA Government approved the 2020-2024 strategy for development of the small and medium-size entrepreneurship and its resulting 2020-2022 action plan.
The goal of the strategy is to create a favorable environment for SMEs in the Republic of Armenia through development of entrepreneurial skills, implementation of ideas, increase of competitiveness, which will also enable SMEs to ensure their access to domestic and foreign markets.

The target measures of the strategy are aimed at improving the availability of financial resources for SMEs, capacity building, as well as formation of institutional and legal framework necessary for promotion of entrepreneurial culture.

As a result of adoption of the strategy, the activities to be implemented in 2020-2024 include training courses aimed at development of entrepreneurial skills and improvement of financial literacy, which annually will be attended by 1,000+ beneficiaries on average. The training courses have already started, for which 591 beneficiaries (out of which 500 meet the criteria) have applied for participation. At the beginning of the training course, the beneficiaries pass a digital literacy test, and based on its results, if necessary, participate in a digital skills development course (including skills on using the Internet and various digital tools). The digital literacy course is followed by a business skills development course, at the end of which the beneficiaries are able to transform an initial business idea into a business plan, whereby the feasible and realistic ones receive a loan guarantee (note: to promote women’s entrepreneurship, female entrepreneurs are provided with a lower interest rate of 7% instead of 9%).

The courses start on a weekly basis. Currently, 50 beneficiaries have completed the digital literacy course, while another 50 beneficiaries are in the process of taking the course. 120 beneficiaries participated in the business skills development course. In order to promote the realization of viable ideas, at the end of the training courses it is envisaged to provide loan guarantees to about 250-300 organizations this year.

In order to increase their access to domestic and foreign markets, organizations will receive support to be represented in international trade platforms, as well as for development of online trade in Armenia. In order to achieve the targets defined in this context, it is especially important to also implement the innovation and digital promotion measures envisaged by the strategy.

In order to promote the exportation capacity among SMEs, companies with export potential will be singled out, barriers in foreign markets will be identified and studied, a demand analysis will be carried out, as a result of which the targeted support will be provided.

In order to establish and improve the institutional and legal framework, it is planned to improve the SME statistics, as well as ensure online accessibility of educational, analytical, and information materials for a wider range of entrepreneurship-minded people.

As a result of implementation of the measures defined by the strategy, it is planned to promote the growth of SME productivity by increasing the productivity by 3% in 2020-2023, and by 7.5% in 2024. In particular, the added value created by an employee in SMEs in 2024 will make 12 million AMD, which is almost twice the same indicator of 2018 (in 2018 the indicator is 6.7 million AMD).

As a result of the targeted actions defined by the strategy, the number of people employed in SMEs will increase by an average of 2.5% per year.

The strategy was developed back in 2019, but was revised and updated to reflect the impact of the pandemic and identify ways to overcome the difficulties and challenges induced by the spread of the Coronavirus.

In order to mitigate the impact of the pandemic, greater importance was given to improvement of the bankruptcy process and second-chance mechanisms, overcoming additional difficulties with access to finance and the need to engage SMEs in large value chains. As a result of actions envisaged for implementation, not only the productivity of SMEs will significantly improve and the number of employees will increase, but due to the transferred skills and improved environment the entrepreneurial activity may also become an alternative to work abroad, lost jobs, and recovery of income.