IDB Group Support to the Small and Medium Enterprise Sector (1990-2002): Achievements, Lessons and Challenges

Small and medium enterprises are estimated to account for at least 10 percent of the number of total businesses in most Latin American countries and between 20-40 percent of total employment. In the 1990's, 30 percent of new jobs were created by SMEs. Small companies have played a major role in developing clusters and productive chains that can compete in international markets and also show great potential for innovation and support for technological development. This technical report summarizes the achievements, lessons, and challenges of IDB Group operations over the period 1990-2002. As a regional development organization, the IDB Group (which includes the Inter-American Development Bank, the Inter-American Investment Corporation, and the Multilateral Investment Fund) has worked with governments and the private sector to overcome SME deficiencies and explore alternatives to maximize SME development across the region.