Support for small businesses, between opinions and facts in Algeria
1 / Study and analysis of the sample:
Through
this research, we seek to study the effectiveness of microfinance support, and
to distinguish between opinions and realities, and between divergent views,
highlighting the problem with which research means, then the possibility of
coming up with certain proposals which are useful for increasing the efficiency
of microfinance financing.
This
study mainly attempts to assess the role of the National Agency to support the
employment of young people in the financing and development of small businesses,
and represents an attempt to identify the most important problems of financing small
businesses. in Algeria, and to propose results and some suggestions to solve
these problems. We ask the main question of this document as follows: How
effective is the role of the National Agency in supporting the employment of
young people in the face of the funding difficulties encountered by small
businesses?
To solve the problem, we made the following assumptions:
-1
Notwithstanding the policies and sources of financing available, the problem of
financing small businesses remains a constraint on financing needs;
-2
Despite the role assigned to the National Agency for Youth Employment Support,
there is a marked insufficiency in the effectiveness of the agency's role in
the financing of small businesses;
-3
Proprietary financiers on the one hand and financial institutions on the other
have also contributed to this gap.
Definition of the study framework:
We
have decided to abandon the study on the beneficiaries of microfinance
institutions funded by the agency, by selecting a random and deliberate sample
of 162 people, among the small businesses participating or present at the
fourth national exhibition of small businesses. .
Different definitions of small businesses:
Not
agreeing on a unified definition of small businesses may not be a problem, but
rather generally reflects the different environments, economic conditions and
needs associated with the motivation behind their creation, and also explains
the section on the dynamics and mobility of this type of institution.
Studies
on small businesses have shown that there are over fifty definitions, and many
countries do not have a unified official definition for this type of
institution, while other countries have many different definitions.
Given
the different sizes of the institutions, it was not unanimously agreed to
define a unified term which corresponds to the characteristic of the size or
the size of the institution, apart from the fact that several terms are used in
many foreign and arabic writings, due to their presence in the legislation
"micro-entreprise" but in Algeria it is called an Applicable expression,
which is the term that we will use in this study and considering this term.
The
term microenterprises is a broad term that includes activities ranging from a
self-employed worker to a small organization employing a certain number of
workers each. This definition is not limited to private sector institutions,
their owners, business owners and employees, but it sometimes includes
cooperatives and family or family production groups.
And
defining the concept of mini-companies requires removing some overlap between
this concept and the concept of mini-projects. The word "project"
means "the question is ready to study and decide that the company is still
at the study and planning stage and will be implemented if its economic feasibility
is proven." As for knowing whether the organization is already working,
producing and buying its products, it is in this case that the term mini
enterprise can be used, which is meant here in this study.
The
small businesses differ from each other, because some of them are solidarity
enterprises, workshops or family or craft businesses, and these institutions
are confused in favor of their future development plans, each sector of which
has its characteristics, its problems and its needs, and the following table shows
the differences between these terms.
1- Reasons and objectives for the creation of small businesses:
Interest
in small businesses in particular and small and medium-sized enterprises in
general has increased, which means that there are many problems with which
large institutions cannot cope or find solutions, in addition to the conviction
governments and individuals right now on the importance of establishing this
type of institution and the roles that can be played. In it in various areas of
economic and social development.
2.1 Reasons for creating small businesses:
-
There are many motivations for interest in microfinance institutions in
developed and developing countries, and these motivations stem mainly from the
roles that these institutions play in many areas of development related to a
number of aspects such as production over 8 generations, income and employment
opportunities;
-
increased capital accumulation and mobilization of national savings;
-
Create and refine the technical and managerial skills necessary to advance
industrialization, achieve a better regional balance for development;
-
Contribute to sub-industries and feed large companies;
provide a significant dependence on
innovation, creativity and technological discrimination.
This is due to some economists the reasons for the increase in the number of small businesses in the world for the following reasons:
-
The increase in the volume of services due to the information and communication
revolution, which has favored the development of service-oriented small
businesses;
-
Increased innovation in modern services in national and international markets;
-
Increased population growth, which has led to the inability of the state to
meet all the demands of the labor market, especially after an increase in the
tendency to a market economy;
-
an increase in the activity of private companies after the tendency in many countries
to privatize public institutions.
-
Positive attitude towards encouraging micro-enterprises in different economies;
-
Globalization has increased global business opportunities;
-
Electronic commerce has facilitated the process of business creation and
exports at lower cost compared to traditional commerce.
-
And you can add certain factors that are mainly due to social reasons, such as
the continuation of the family institution or the heritage of the institution
Improving the social situation, or the desire to belong to a certain category,
such as the category of businessmen and business owners, and the main motive in
developed countries to create small businesses is to maximize profits for their
owners.
2.2 The objectives of small businesses:
The creation of micro-enterprises aims to achieve several objectives, in particular:
-
The promotion of individual and collective entrepreneurship, using economic
activities of goods or services which did not previously exist, as well as the
revival of activities abandoned for any reason whatsoever;
-
Create new job opportunities directly and this is for the creators of
institutions, or indirectly by using them for other people, and thanks to the
creation of job opportunities, the rapid response to social demands in the
field of work can be obtained.
-
Reinstatement of redundant workers from their jobs due to the bankruptcy of
certain institutions, or due to the reduction in the volume of jobs in them due
to restructuring or privatization, which favors the possibility of offsetting
some of the lost activities.
-
Recover all the unprogrammed and unimportant production chapters available to
the major institutions in order to refocus their energies on the original
activity;
-
It can be an effective tool for setting up activities in remote areas, which
makes it an important tool for valuing and promoting local wealth, and one of
the means of integration and integration between regions ;
-
It can be a link in the economic fabric through all of the relationships it maintains
with the rest of the surrounding institutions and in interaction with it and
which share the same inputs;
-
Allow many groups in society to have good investment ideas but not have the
financial and administrative capacity to transform these ideas into realistic
projects;
-
It constitutes one of the sources of income for its innovators and users, and
it is also an additional source to develop the financial return of the State
through various deductions and taxes;
It
is one of the means of integrating the informal and family sector.
3- Field study: study of the funding role of the National Agency to support youth employment:
In
collecting information and data on small businesses in Algeria, we relied on
the social survey method for a sample of these institutions, using the
questionnaire form which passed through severals steps to prepare it and adjust
it to its final form.
3.1 Study sample:
The
sample included microfinance institutions funded under the National Agency to
support youth employment through tripartite funding, since this mode of funding
is clearly a gap in the funding of these institutions, compared bilateral
funding. A random sample of 162 people was used in participating small
businesses, or whose owners attended the fourth national exhibition of the
mini-establishment, organized by the National Agency to support youth
employment at the Palais des Expositions - Algiers.
3.3 Presentation and description of the study sample and the characteristics of the micro-enterprises located there:
3.3.1 Description of the study sample: Before entering into the analysis of the results, we first know the study sample that was studied.
1- Depending on the date of funding by the agency:
Distribute
the individuals in the sample according to the date of funding by the agency.
The
majority of the small businesses in the sample were funded before January 2004,
which means that they were funded in the first device of the National Agency
for Youth Employment (before the modification in the texts organizing the
agency ). On the other hand, we find the sample financed within the framework
of the new apparatus of the National agency for the employment of the young
people, that is to say after the amendment which started Indeed from January 3,
2004, the latter in which numerous incentive measures have been taken
concerning the agency apparatus (increasing the level of authorized investment,
reducing the personal contribution, allowing the expansion of the activity ...
etc). On the other hand, the highest percentage of individuals in the sample
falls into the 25-30 age group (bin Pric) 47.53%.
-
The majority of beneficiaries within the framework of the National Agency for
the support to the employment of young people come from age groups below 30
years, especially between 25-29 years, and this is due to the fact that the
group the agency's target is limited in terms of age between 19 and 40, in
addition to a performance requirement or exemption from national service.
-
For the first age group, this period generally includes training and studies,
which contributed relatively to the decrease in the members of this group
compared to the second category. Perhaps the large difference in the ratio
between the age groups under 30 and the older groups is explained by the
tendency of the older to settle preferably at work in exchange for 'a salary
and a reluctance to risk, which is to some extent one of the conditions for
self-employment.
2 Distribution of institutions according to the bank of the lender:
The
table shows that the Bank for Agriculture and Rural Development is the head of
the banks which finance the institutions included in the sample of (48.77%),
followed by the National Bank of Algeria at (36.42 %), and the rest of the
banks have smaller proportions, the last being the Algerian external bank by
not financing it for any small institution. And the presence of a large
variation in the funding ratios between these banks for these institutions,
although they are all public banks, may be due to the difference in the spread
of their banking networks at the local level, and to the vision of their
managers.
3 Distribution of respondents by business sector:
Table
n ° (04) Distribution of respondents according to the sector of activity It
appears from the table that the service sector is more polarized for youth
projects within the framework of the agency, where its percentage in the sample
studied is estimated at approximately (46.3%), followed by the industrial
sector ((25.9%) and the sector's preference may be due Services, in particular
in the transport sector, on the one hand, the presence of significant
opportunities for investment in this area, particularly after the dissolution
of many public transport institutions, and their activities in the transport
sector have been reduced.
On
the other hand, the simplicity of the qualification required at agency level to
establish an institution in the field of transport, because it only requires a
driving license, because these results show us relatively young people in the
industrial sector .
3.3.2 Profiles of the small businesses within the framework of the study:
The
results revealed many characteristics that distinguish small businesses in the
study sample in terms of number of workers, size of investment and legal form,
in what is considered to reflect the criteria for definition that distinguish
the institutions mentioned from the others.
-1 Distribution of individuals in the sample according to the size of the initial investment:
Table
n ° (05) Distribution of individuals in the sample according to the size of the
initial investment
According
to the table, more than two thirds of the individuals in the sample have less
than 3 million DZD projects, on the other hand, only 45 beneficiaries exceed
the amount of investment in their projects without this amount and 10 million
DZD.
It
seems that the most important category of institutions in terms of the amount invested
is between (1 and 2 million DZD), due to the small percentage of the young
man's personal contribution to this level of investment between (5% - 10%) and
that the amount available At this level, it gives a relatively greater
investment margin compared to the first level.
-
Less than one million dinars (and there is a relative decrease in the number of
establishments whose investment exceeds the amount of 4 million DZD) 23
establishments, which may be due, on the one hand, to the strong personal contribution
of the young person to this level of investment, and also given that this level
of investment has enabled him. It was only after January 2004 in the new
machine for the employment of young people.
2 Distribution of small businesses by number of workers:
Table
No. (6)
With
regard to the number of workers, it appears that around two thirds of the
companies included in the sample employ less than 10 people. The overlap
between the concept of micro and small and medium-sized enterprises is
difficult, as the micro-enterprise model with fewer than 10 workers prevails.
3 Distribution of the institutions in the sample according to the legal form:
Table
n ° (7) Distribution of sample institutions according to legal form
The
previous table shows that most of the individuals in the sample prefer to adopt
the legal form "natural person", perhaps due to the simplicity of the
procedures for issuing and obtaining licenses in connection with the adoption
of this form. of the institution in relation to the legal procedures for
creating a company or an institution, and when examining the second option,
"legal entity" We note that among the (64) institutions which adopt
the legal form, a " legal person ”(81.25%) is made up of businesses, the
majority of which were created before the approval of the new youth employment
agency (January 2004 of 78.85%), and this may be due to the dominant belief
when The device was launched with the requirement of a collective legal form,
as it was The first program for the employment of young people requires
cooperatives in addition to the relative increase in the contribution, which
reduces a person's ability to provide it without the need for partners in the
project, before applying the new scheme for youth employment.
