Support of Local Entrepreneurship During Periods of Crisis: A Case Study for Serres-Greece on NSRF Programmes

Abstract

Abstract The role of Small and Medium Enterprises (SME's) to regional development is crucial. Taking as a granted that National Strategic Reference Framework (NSRF) focuses on regional disparities reduction, the main scope of this paper is to examine the influence of the NSRF programs on Regional Unity of Serres taking under consideration the existence of great intraregional disparities in region of Central Macedonia. Recently, peripheral disparities undoubtedly deteriorate Greek recession, something that is underlined at the relevant literature. According to Joseph Stiglitz “with inequality at its highest level since before the Depression, a robust recovery will be difficult in the short term” Also, Paul Krugman adds “countries doing a lot of redistribution have, if anything, weathered the crisis better than those that do less” As enterprises confront huge sustainability problems, their investments are deteriorated. Greek state, under the framework of NSRF 2007-2013, announced on spring 2013 the program “Support of SME's which are activated in Manufacturing - Tourism - Commerce & Services” (the program will de completed until the end of 2015). The NSRF provide subsidizes using general geographical-economic (mainly income) criteria (at regional level NUTS2) without examining the NUTS3 level. It is common knowledge that Greek banks nowadays do not support firms sufficiently. Thus, many of the eligible (under the umbrella of the examining program) investments may not be completed. Hellenic Fund for Entrepreneurship and Development (ETEAN), the associated institution, does not provide the necessary funds to all the entrepreneurs. During the last 4 years the 20% of local enterprises have been closed. It is obvious that crisis badly affected local entrepreneurship. According to Serres Chamber of Commerce and Industry the number of enterprises at Regional Unity of Serres have been reduced from 14.103 (January 2010) to 10.715 (January 2015). All the above mentioned are analyzed in our theoretical part. Our empirical research was conducted in February 2014. The survey consists of two parts. At the first part, a comparative analysis between the region of Central Macedonia and the Borough of Serres takes place. At the second part, all the local eligible enterprises, that will receive subsidizes from ESPA were participated in this research (total 123 ones). The used methodology is the calculation of the main descriptive statistical measures (the average, the standard deviation and the coefficient of variation) and the statistical moment of distribution (the coefficient correlation). According to our main findings, the contribution of NSRF programs as they are regulated by the developmental national laws to the survival and development of local enterprises has been significant, although the legislator disregarded the fact that borough of Serres is poorer than the core region Thessaloniki. The intraregional disparities (which have been indicated both in the theoretical and in the empirical part) should be taken under consideration when a low is reconsidered. Finally it should point out that the general results of our empirical research are relying to the relevant used literature.