With the collapse of the communist central planning regimes throughout Eastern and Central Europe and the vast areas of the former Soviet Union, there has been a trend towards building up a significant private sector and encouraging dynamic growth in the emerging markets of national economies. The donor agencies have responded by developing aid programmes to help in the creation of a strong private sector and more specifically to help in the development of small and medium enterprise (SME). Venture capital investment, loan guarantee funds, business innovation centres, technical exchange visits and regional trade fairs are being set up in a region of the world where banking and marketing facilities are more often in short supply than technical sophistication.;This work looks at some of the experiences of SME projects carried out in the various countries in the region that were reported. Four themes considered of central importance to SME development - financial suport, technical and management services, favourable policies conducive to SME development and the involvement of international donor agencies - are examined. These themes are illustrated through case study material presented at a major international conference in Budapest. These case studies describe and share the experiences of organizations and individuals involved first-hand in all aspects of small and medium enterprise development.

Microenterprises - very small businesses consisting of a single self-employed person, a family, or at the most a few employees - are the main source of livelihood of up to half of the population of most developing countries. In the past this vital sector, often referred to also as the informal sector, has received inadequate attention, but increasingly multilateral and bilateral agencies and non-governmental organizations are searching for ways to help improve the effectiveness of these microenterprise operations and to enable them to make a greater contribution to the development of the third world and to the general efforts to enhance incomes and raise living standards. This collection of sixteen papers by experts with considerable experience in the field emanates from the International Conference on Microenterprises held in Washington DC, USA, sponsored by the Committee of Donor Agencies for Small Enterprise Development on 6-9 June 1988. It is organized according to the major issues relating to the subject: the structure of the microenterprise sector, government policies towards microenterprises, informal credit markets, financial and technical services, institutional aspects and a review of the experience of assistance projects. This publication should be of great interest and value to all concerned in increasing assistance to the development of microenterprises in developing countries.