In Bosnia, It’s All About SME
The Balkans region does not receive the attention and investment to the degree that other regions of the world do. Plenty of reasons make the list: locals will tell you that corruption is an issue; the infrastructure could use some work; these are small countries that cannot compete on capacity and scale; and for the social entrepreneur, Africa, Asia, and Latin America are way more “cool” and “sexy.” Some international assistance has tricked into the Balkans, but the scope is small. International aid organizations, both private and foreign government-funded, often focuses on non-profits and philanthropic work. Most of that money, it should be noted, goes to paying for these foreign workers’ salaries and expenses. So in the case of Bosnia, for example, little of that money goes to the people who work the hardest and need it the most. While I was in Bosnia, I had the opportunity to meet with Marc Neal, a Canadian expatriate who runs Finor Consulting, a consultancy based in Sarajevo. Mr. Neal is an accountant by trade who eventually worked as a consultant on large projects for international organizations, including NATO, throughout Europe. He has been based in Sarajevo for a few years, and now this is home. The past few years have been a grind, but Finor is set to be profitable next year--in the meantime he has not taken a salary, while building a staff of talented local Bosnians. Mr. Neal summarized Bosnians’ frustrations for me during our conversations. While charity has its place, what small countries like Bosnia needs is business, not philanthropy. Despite its challenges, Bosnia has a legacy of a strong educational system, is rich in natural resources, and a workforce able to contribute to the economy if given the opportunity. Scoring credit, however, is difficult, as most banks are foreign-owned. And programs that purport to help Bosnians often leave businesses off of their target lists. And that is a mistake. NGOs and charities do some good work, but they will never be able to employ people and generate wealth the way private industry can. As in any economy, small- and medium-sized enterprises are the economic drivers. Stories about helping poor people and tackling token environmental problems have their place and look great in a brochure or a PDF file; but providing credit and strategic advice to companies in mining, agriculture, and manufacturing (like furniture) is the way to go here. At a fundamental level, many folks who work for international organizations have little, if any, experience in business, and hence there lies a huge disconnect. Given the opportunity, small and medium sized companies here could find niche markets for anything from IT services to wood products to food. It’s time to focus on what Bosnians need in order for countries to succeed, not on what international organizations want in order to provide talking points at annual conferences. Remember you can stay informed on our SE Europe Series by subscribing; you should receive no more than 3-4 notifications a week.