All over the world, there is growing evidence that SMEs play an important role in the national economic development of any country. SMEs are becoming more and more a subject of high attention in the developing countries, countries in transition but also in the countries with developed economies.

In market economies, SMEs are the engine of economic development. Thanks to their private ownership, entrepreneurial spirit, their flexibility and adaptability as well as their potential to react to challenges and changing environments, SMEs contribute to sustainable growth and employment generation in a significant manner.

Until latest, the private sectors of many emerging economies were missing the middle level of development. Investors, policymakers, and professionals dedicated most of their efforts to big companies of over 500 employees, larger enterprises or multinationals. Large Enterprises and MNCs were target of TAX incentives and subsidies whereas organizations like World Bank and UNDP were focused on supporting the micro-enterprises which usually have less than 5 employees. Between these two extremes, lie the SME businesses. In the past, SMEs have been considered as not being the key element to drive the economy therefore it was considered as not worthy to focus the policies of the government to them. However, lately there have been many promising initiatives to support the SMEs operating in crucial segments of emerging economies not only by investments but business leaders as well, leaders who clearly recognize the role of SMEs in building a sustainable economy development.

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The SMEs are becoming more and more present in the countries’ economies.

The percentage of that presence is shown below:

Number of companies : More than 99% (Japan, US, Germany, China)

Number of employees: 66% in Japan, 53% in US, 68% in Germany

Value added: 55% in Japan, 51% in US, 455 in Germany

They play a significant role in national economy by providing various goods and services, creating job opportunities, developing regional economies and communities, helping the competition in the market and offering innovation.

Main areas of their presence are manufacturing industry, distribution industry and services industry.

In the manufacturing industry they produce goods by using skills developed historically and accumulated by individuals; Produce products whose row materials and goods are limited in terms transferable time (foods, etc.); Operate fields in which are many processing and manufacturing methods and whose economic efficiency can be enhanced by specializing them in the areas of expertise (parts and supporting industry for autos, home electric appliances …); Produce product whose market size is too small for big companies to enter; Operate in markets where innovative entrepreneurs take risks, commercialize new technologies and develop new business.

In Distribution Industry they operate in order to distribute a variety of goods efficiently from the manufacturers to consumers and for the reason and need that the existence of many SMEs having businesses tie-ups is essential.

In the Services Industry they operate in the presence of many services provided both to businesses and individuals where due to constrain of time and distance, a large number of SMEs are needed to provide them.

SMEs play a big role in the vitalization and development of national economies because they are creating job opportunities, promotes stability and development of regional economies, produces much of the creativity and innovation that fuels economic progress, promote the competition and cooperation and produce high value added products. Large number of people relies on the small and medium enterprises directly or indirectly. They play a big role with their contribution in labor absorption, poverty alleviation and revenue generation. The critical importance of this sector warrants much more attention by all the stakeholders which includes government agencies, academia and multinational companies because of their vested interest.