The development of social economy and social entrepreneurship could significantly help eliminate social inequality, reduce the contrast between the North and the South, ensure balanced economic development…
There have been increasing discussions about social entrepreneurship in Montenegro in recent years, primarily thanks to the European Union and non-governmental actors. However, its revitalisation requires more government involvement, both in providing financial and other support mechanisms, as well as help in intersecting actors at the local, national and regional level.
The essence of the matter is that the concept of social economy and social entrepreneurship is extremely important for a sustainable development of our country, something which has especially been highlighted by the EU in the last two decades.
It is expected that the concept of social entrepreneurship in Montenegro will be especially relevant in the years to come. The already difficult economic situation has been brought to a breaking point by the COVID crisis, so the state should finally recognise the potential of social entrepreneurship, one which developed and economically wealthy EU members have long used as the only sustainable model for solving a variety of social issues.
There is official data on the size and structure of social enterprises in Montenegro, so we can only rely on previous research. The first mapping of social enterprises in Montenegro was done by the Centre for Development of Non-Governmental Organizations (CRNVO) in 2016. This research, which included organizations CRNVO has worked with directly, identified 19 social enterprises, 16 of which were active at the time of the research.
The research showed that social enterprises operate under various legal frameworks (14 out of 16 active social enterprises functioned as NGOs, one was registered as an LLC, and one as a protective workshop). The second survey, conducted in 2017, estimates that there are 20 to 30 social enterprises in Montenegro, while the latest survey from 2019, conducted for the needs of the European Commission, showed that there are more than 130 social enterprises. Most operate as non-governmental organisations, there is one registered labour integration company, two cooperatives, and less than 10 social enterprises are operating as LLCs.
If we were to apply EU data on the impact of the social economy to the case of Montenegro, this would translate to at least 14,000 new jobs (average employment rate at EU level at 6% of the working population), primarily helping hard-to-employ people and people from less developed cities in Montenegro. On the other hand, if the level of the social economy reached the stage of development as in Ireland and the Netherlands, then this part of the economy could employ as many as 20-22,000 people (9-9.5% of the working population).
There are several strategies on social entrepreneurship in Montenegro, aiming to encourage the spread of innovative and sustainable business models.
In order for this concept to come to life, however, it needs to become an integral part of the overall development strategy which, in addition to removing numerous business barriers, should also enable the activation of all available economic resources that are not currently used or are insufficiently used.
The development of social economy and social entrepreneurship is extremely important in Montenegro because it could significantly help eliminate social inequality, reduce the contrast between the North and the South, ensure balanced economic development, among other benefits. Neither the market nor the state are able to solve numerous social problems on their own, including the employment of hard-to-employ citizens, social inclusion, and the country’s regional development.
Anto Jankovic is a civic activist, president of CEPS, Center for Economic Prosperity and Freedom. Author of study ‘Social entrepreneurship and development in Montenegro’