The
term entrepreneurship is commonly used to describe the starting of new
organizations or businesses. It is a extremely important factor in each country
because it helps to deal with many economic issues (e.g., unemployment). I
believe that there are many ways how entrepreneurship is being promoted in
Lithuania.
It
is noticeable that it was created a new type of business called “small
partnership” in 2012, in Lithuania. This leads to the idea that this kind of
business specie was made by seeking to promote entrepreneurship in the country.
It is the reason why there were made so convenient conditions to create your
own company. For instance, a person who wants to start his own business does
not need to have the initial capital. From this, it means that there are more
people who can use this opportunity. Also it is applied a limited property liability. As a result of this, it
reduces the risk taken by starting a business.
Another significant point to be made is that it was a great opportunity to
manage with the crisis (in 2008-2012) and specially dealing with the unemployement
issue. Regarding to the data based on Eurostat, unemployment in Lithuania has
decreased from 14% to 11.4% from 2012 January to 2016 January. “Small
partnership” was one of the instruments which helped to reduce it.
Furthermore,
another way to promote entrepreneurship in Lithuania is preferential loans. For
people who want to start their own business, interest rates of taking a loan were
made lower. One of the conditions for taking this kind of loan is for financing
the investments or working capital. The highest amount of money a person can
lend is 25 000 euros. The interest rates are from 5.5% to 9.5%. This idea was
created by Lithuanian Labor Exchange. Its aim was to create better conditions
for small companies to start their own business. In fact, there were also made
courses which main goal was to teach people how to manage a company. Despite of
this, there was also made available the opportunity to attend private
consultations, which help to create business plans.
Other
European countries promote entrepreneurship in a similar way. For example, in
Germany are provided financial supports to promote entrepreneurship. In this
case, there is an amount of money which is given to a person to start his own
business. This kind of tool is commonly called of “start-up” and it is
important for the whole country’s macroeconomic indicators because it can help
to extend the market and raise the export level of the country, although there
is still a huge amount of people in Germany who do not prefer to have their own
business. Just under 50% of Germans (according to the data of Global
Entrepreneurship Monitor) agreed that starting a business was an attractive
idea. In comparison, in Poland it is 68%, France 65% and in Netherlands 79%.
Another
way to induce entrepreneurship is promoting cooperation between researchers and
the private sector. This idea is being used in Netherlands. The government is
working with the knowledge institutions and private sector to improve
public-private partnerships.
On
the other hand, there are also plenty of reasons why it is still hard to start
your own business. There is always a probability that you can be not successful
in the chosen area and go bankrupt. Another significant point to be made is
that there are very big taxes in Lithuania. They are applied to the companies
which want to end their business. That is the reason why people are not so
excited to create their own firms in Lithuania.
To
sum everything which was said up, entrepreneurship is important for country’s
development. In my opinion, there is a huge amount of ways how it can be and is
being promoted in Lithuania and other European countries.
Ugne Stankeviciute
References:
1.
Algimantas Misiūnas (2016). Entrepreneurship
Impact to Economical Indicators. Interact: http://www.stat.gov.lt
2. Lithuanian
Republic Finance Ministry (2012). Interact: http://www.esparama.lt/verslumo-skatinimo-priemone
3. Data
of unemployment in Lithuania. Interact: http://ec.europa.eu/eurostat/web/main
4. Data
of Global Entrepreneurship Monitor. Interact: http://www.gemconsortium.org
5. Netherlands
Government (2014). Enterprise and
Innovation. Interact: https://www.government.nl/topics/enterprise-and-innovation/contents/the-government-supports-entrepreneurs
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