FYR Macedonia Supplier Development Pilot Program Toolkit : Materials and Lessons Learned

A supplier development pilot program (Pilot SDP) was designed upon request from the Macedonian Government aiming to stimulate linkages between local SMEs and large foreign companies operating FYR Macedonia. The program piloted a group of targeted and coordinated interventions to support local SMEs to increase their sophistication, compete more effectively and integrate into the global and regional supply chains of the large foreign companies located in and outside the special economic zones (TIDZs). The Program was a joint effort of the International Bank for Reconstruction and Development (IBRD) and the International Finance Corporation (IFC). International experience suggests that SDPs can make a substantial impact in generating increased domestic value added. The Czech and Serbian experience showed that having SDP in place is a win-win for all parties involved in the process (Government, foreign investors and local companies). Countries that attract Foreign Direct Investments (FDI) but do not develop linkages do not fully benefit from FDI; SDPs are instrumental in attracting additional FDI, and thus government should promote SDPs as part of their FDI strategy