Date: Wed, 6 Aug 2008 12:26:21 -0700 (PDT)
From: Gail Buyske <gailbuyske@yahoo.com>
Subject: re August 6/ SMEs in Russia and China
Regarding item no. 33 on August 6, "SMEs in Russia and China," by Max Bolotinsky and Hongda Jiang, I would like to add a more positive perspective on Russian SME development. Russian SMEs typically appear to be badly underdeveloped because Russian statistics for entrepreneurs, which are often used interchangeably to refer to SMEs, are calculated using a smaller data base than that used in many other countries to which they are compared. Russia entrepreneurship statistics are based on small business data, while in many other countries (such as western Europe) these statistics are based on micro, small and medium-sized business data. Until the change in the Russian law on entrepreneurship last year, there was no official definition of a micro or a medium-sized enterprise, and therefore no corresponding statistics. Furthermore, the definition of Russian small business was more restricted than the definition used in western Europe. Therefore it is completely logical that the Russian figures are so much lower than the western European figures. A study conducted by Tacis in 2001 and a study conducted by the Russian SME Resource Centre and USAID in 2003 both concluded that, if the Russian data is adjusted to make it more comparable to the European data, Russian SMEs accounted for 39-40 percent of the national output of goods and services and approximately 45 percent of employment. These figures may not be as impressive today, given the rapid growth of GDP, but they nevertheless paint a strikingly different picture than the one to which we are accustomed. I address this and related topics in "Banking on Small Business: Microfinance in Contemporary Russia" (Cornell U. Press).