Investment Support to Small and Medium-Sized Enterprises in Croatia

Small and medium-sized enterprises (SMEs) are the proof of human efforts in independent presentation of the leverage aimed to faster and more efficient economic development. Developed countries have accepted and implemented the concept of enterprises by creating positive business environment and a supportive financial structure. The significance of SMEs in total economic development of Croatia became noticeable during last years. SMEs are increasingly represented by growing number of economic subjects, in financial results and in number of employees within the total economy. Certainly, the biggest problem to SMEs is funding, i.e. difficulty in approaching the capital essential for their establishing and development. In this area a very special role belongs to the state and regional units of self-government which should provide a stable and safe business environment in order to contribute to both, creation of new and development of the existing economic subjects. By strengthening the competitiveness of the SMEs on the long-term basis there is tendency to create favourable conditions for the growth of investment and increasing the number of entities with new products resulting in higher added value. Namely, since the mid of the year 2013 all the participants have found themselves in a new situation, while SMEs are looking for a support and institutions which can provide it (Ministries, Environmental Protection and Energy Efficiency Fund, Croatian Bank for Reconstruction and Development, Croatian Agency for SMEs and Investments and the like). When Croatia became a member of EU, surveillance of the financial supports has been transferred to the rigorous ?big boss“, European Commission. Looking forward to the future, the portion of EU funds of support should be growing, while national supports should lessen. This work researches institutional and regulatory restrictions to development of the SMEs in Croatia. The research is specifically targeted to the problem of financing of SMEs in Croatia and it shows the complete system of financing of this part of the national economy. At the same time the purpose and goal of this work is to provide systematization, describe and explore relevant determinants of financial supports to SMEs in Croatia, as well as to propose improvements of the existing and implementing of possible new sources of financing, that would significantly expand possibilities of financing of these enterprises in terms of quality.