Current stance of entrepreneurship and SME development in Georgia: perspectives and challenges

The paper analyzes external and internal factors impeding and determining entrepreneurship and Small and Medium Enterprise (SME) development in Georgia and scrutinizes the role of the state in the process. Thirty in-depth interviews were conducted with different stakeholders. The study findings show that notwithstanding the rigorous reforms leading to improved business environment, establishment of a vibrant SME sector in Georgia is still a challenge. In the paper, the author identifies major institutional and private sector specific weaknesses and provides policy recommendations. The study presents not only a specific country environment, but also explores different stages of transition process and its impact on entrepreneurship and SME development, describes factors affecting entrepreneurial outcome in the advanced transition countries.