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Social entrepreneurship in Serbia: turning a crisis into a success Social entrepreneurship in Serbia: turning a crisis into a success
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Now is the right moment to support the development of social enterprise in Serbia, and it is important to do it properly.Now is the right moment to support the development of social enterprise in Serbia, and it is important to do it properly.
Having emerged from a turbulent period of its history, Serbia is moving towards EU accession. After making significant progress in the past decade, the country and its people are now facing destitution brought on by the global economic crisis.Having emerged from a turbulent period of its history, Serbia is moving towards EU accession. After making significant progress in the past decade, the country and its people are now facing destitution brought on by the global economic crisis.
While still undergoing a difficult process of transition to democracy and market economy, Serbia carries some unfavourable legacies of its socialist past. The economy and social services system collapsed after decades of state control, leaving those habituated to state dependence with a strong distrust of that same state, and wary of social ownership.While still undergoing a difficult process of transition to democracy and market economy, Serbia carries some unfavourable legacies of its socialist past. The economy and social services system collapsed after decades of state control, leaving those habituated to state dependence with a strong distrust of that same state, and wary of social ownership.
Socialism also meant there was no encouragement of entrepreneurial culture. This led to a troublesome mindset: research shows that nearly two thirds of people would prefer the state as their employer. Given that the IMF put the unemployment rate at almost 40% in 2012 (it is even higher among the young), this attitude is a further challenge for the impoverished country, coming on top of regional disparities, growing social exclusion, high rates of corruption and defunct public institutions.Socialism also meant there was no encouragement of entrepreneurial culture. This led to a troublesome mindset: research shows that nearly two thirds of people would prefer the state as their employer. Given that the IMF put the unemployment rate at almost 40% in 2012 (it is even higher among the young), this attitude is a further challenge for the impoverished country, coming on top of regional disparities, growing social exclusion, high rates of corruption and defunct public institutions.
The transition further compromised the entrepreneurship model by associating it with the image of corrupt elites plundering public resources. The older generation is disappointed and apathetic, while the youth is fearful and confused. The need for urgent action is acute.The transition further compromised the entrepreneurship model by associating it with the image of corrupt elites plundering public resources. The older generation is disappointed and apathetic, while the youth is fearful and confused. The need for urgent action is acute.
A sustainable social enterprise model offering a blend of individual initiative and concern for collective needs is precisely what Serbia requires.A sustainable social enterprise model offering a blend of individual initiative and concern for collective needs is precisely what Serbia requires.
Widespread poverty and social problems coupled with inadequate support from inefficient state institutions create a need for social business models that could aid recovery and growth, bringing economic reform and positive social change.Widespread poverty and social problems coupled with inadequate support from inefficient state institutions create a need for social business models that could aid recovery and growth, bringing economic reform and positive social change.
The development of social entrepreneurship will show the people of Serbia that they can address the problems they are facing through their own initiatives, and that the interests of society and private enterprise can indeed work together.The development of social entrepreneurship will show the people of Serbia that they can address the problems they are facing through their own initiatives, and that the interests of society and private enterprise can indeed work together.
In the past decade, social economy models were introduced to Serbia as various social enterprises appeared across the country – some 1,600 at the moment. Dynamic, albeit nascent, networks such as Coalition for the Development of Social Enterprise (CDSE) and the Social Economy Network Serbia (SENS) showed energy and capability in supporting the fledgling sector.In the past decade, social economy models were introduced to Serbia as various social enterprises appeared across the country – some 1,600 at the moment. Dynamic, albeit nascent, networks such as Coalition for the Development of Social Enterprise (CDSE) and the Social Economy Network Serbia (SENS) showed energy and capability in supporting the fledgling sector.
However, the opportunities for social enterprise have been somewhat limited so far, and the sector is still emerging in a not particularly supportive environment. Potential social entrepreneurs face many obstacles.However, the opportunities for social enterprise have been somewhat limited so far, and the sector is still emerging in a not particularly supportive environment. Potential social entrepreneurs face many obstacles.
The Organisation for Economic Co-operation and Development (OECD)'s Local Economic and Employment Development (LEED) programme reported in October 2012 that it had found "clear indications of the potential of social entrepreneurship" in Serbia, concluding that "more needs to be done if that potential is to be fulfilled."The Organisation for Economic Co-operation and Development (OECD)'s Local Economic and Employment Development (LEED) programme reported in October 2012 that it had found "clear indications of the potential of social entrepreneurship" in Serbia, concluding that "more needs to be done if that potential is to be fulfilled."
According to the report, Serbia "has taken an impressive number of measures to establish a modern legal framework for the development of social entrepreneurship" but although the context has been considerably enhanced by wide legislative reforms, social enterprises still face a limited range of legally recognised forms, wavering between not-for-profit or for-profit status.According to the report, Serbia "has taken an impressive number of measures to establish a modern legal framework for the development of social entrepreneurship" but although the context has been considerably enhanced by wide legislative reforms, social enterprises still face a limited range of legally recognised forms, wavering between not-for-profit or for-profit status.
A new law on social entrepreneurship is currently under hastened legislation following an insufficiently transparent public debate. CDSE finds the draft law to be "an unprofessional, incomplete and budget-wise irresponsible proposition," its main fault being the tendency to reintroduce the government as a key player.A new law on social entrepreneurship is currently under hastened legislation following an insufficiently transparent public debate. CDSE finds the draft law to be "an unprofessional, incomplete and budget-wise irresponsible proposition," its main fault being the tendency to reintroduce the government as a key player.
Another major problem is financial support for start-up social enterprises – the banking system for SMEs is conservative and risk averse, and microfinance still faces barriers. Yet there are some exemplary practices among international banks in Serbia, including UniCredit Bank, Crédit Agricole and Erste Bank.Another major problem is financial support for start-up social enterprises – the banking system for SMEs is conservative and risk averse, and microfinance still faces barriers. Yet there are some exemplary practices among international banks in Serbia, including UniCredit Bank, Crédit Agricole and Erste Bank.
Serbia needs to build on its strengths and there is certainly optimism for the future. The country is presented with a unique opportunity to establish socially oriented business models while developing entrepreneurial culture. The awareness of social issues and tendency to put social values before profit are legacies of the socialist era that can be beneficially used in the transition to capitalism, showing the young generation how there is a third way – one that is entrepreneurial, sustainable and just.Serbia needs to build on its strengths and there is certainly optimism for the future. The country is presented with a unique opportunity to establish socially oriented business models while developing entrepreneurial culture. The awareness of social issues and tendency to put social values before profit are legacies of the socialist era that can be beneficially used in the transition to capitalism, showing the young generation how there is a third way – one that is entrepreneurial, sustainable and just.
What Serbia's social enterprise sector needs is financial and non-financial international support: learning from the best practices through free coaching, SME training and mentoring programs, help in implementation guidance, skills development (especially business management skills), establishing incubator hubs and capacity-building programmes.What Serbia's social enterprise sector needs is financial and non-financial international support: learning from the best practices through free coaching, SME training and mentoring programs, help in implementation guidance, skills development (especially business management skills), establishing incubator hubs and capacity-building programmes.
Knowledge-sharing and education can provide changing mindsets, helping the country to foster an enabling environment for the development of sustainable social enterprises.Knowledge-sharing and education can provide changing mindsets, helping the country to foster an enabling environment for the development of sustainable social enterprises.
Serbia is coming to realise that there is no magical solution to the current crisis; the solution lies in the people using their knowledge, skills and resources to help themselves. That makes social entrepreneurship in Serbia a matter of paramount importance.Serbia is coming to realise that there is no magical solution to the current crisis; the solution lies in the people using their knowledge, skills and resources to help themselves. That makes social entrepreneurship in Serbia a matter of paramount importance.
As part of Euclid Network and Smart Kolektiv's commitment to support and offer a stronger voice for practitioners, a letter was sent to Commissioner Stefan Füle (European commissioner for nlargement and European neighbourhood policy) to draw attention to these concerns and suggest a better way forward for social enterprise policy.As part of Euclid Network and Smart Kolektiv's commitment to support and offer a stronger voice for practitioners, a letter was sent to Commissioner Stefan Füle (European commissioner for nlargement and European neighbourhood policy) to draw attention to these concerns and suggest a better way forward for social enterprise policy.
Do you work in this field, in the Balkans or elsewhere? What are your experiences? Have recent policy developments opened up opportunities for you, or do you struggle with a lack of institutional support? Click here to read more, then send us your thoughts and ideas to help us put together a case and lobby for policy that works for you.Do you work in this field, in the Balkans or elsewhere? What are your experiences? Have recent policy developments opened up opportunities for you, or do you struggle with a lack of institutional support? Click here to read more, then send us your thoughts and ideas to help us put together a case and lobby for policy that works for you.
Neven Marinovic is director at Smart KolektivNeven Marinovic is director at Smart Kolektiv
This content is brought to you by Guardian Professional. To join the Guardian Social Enterprise Network, click here.This content is brought to you by Guardian Professional. To join the Guardian Social Enterprise Network, click here.
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