Private sector development (PSD) is a key precondition for increasing the competitiveness of all the economies of the Western Balkans. The development of the private sector is linked to a number of policy areas including enterprise policy, public administration reform and infrastructure development. It features prominently in the Commission’s latest Communication on Enlargement and includes issues such as competitiveness, SME policy and financing, human capital development and research and innovation.

The WBIF Steering Committee approved a major initiative to support private sector development at its meeting on 7 December 2011. The Western Balkan Enterprise Development and Innovation Facility (EDIF) will provide venture and expansion capital for innovative SMEs throughout the region. It comprises:

• An Innovation Fund to focus on seed and early stage equity investments in innovative SMEs;

• Expansion Fund to focus on expansion capital equity investments in high growth SMEs;

• A Guarantee Facility to support access to bank lending for local SMEs that currently have limited access to finance;

• A Technical Assistance Facility to support governments in identifying and implementing key reforms to improve the business environment for SMEs.

Further information on this initiative is contained in the meeting documents for the WBIF SC meeting.

For further information on private sector development policies and strategies and organisations active in this sector please consult the Library and Links section.