The best practices
KALUSH
Municipal authorities’ strategy concerning the Smes development
Historic Background
Nowadays Kalush is renewing the market and enterprise traditions. To do this, the state and the local authorities are to be ready to go towards the business. It is very important that the authority representatives were inclined to cooperate with enterprises in social and economic programs realization, so that there are new working places, the budget is filled, and the market is satiated with goods and services.
Kalush has met a rather specific problem: till 1998 the town was developing and maintained at the expenses of the chemical industry giant – the “Oriana” concern, where 17 000 people have been working, or 47,4% of the total number of workers with the relatively high salary.
The economic crises, the world market prices reduction for the concern output have brought to its financial crises. In 1998 production falling-off on the given enterprise made 66 million hryvnas, and the losses reached 379 million hryvnas.
In 1998, 2,9 thousand people were dismissed from the municipalities’ enterprises and organizations. The dismissing level was 1,8 times bigger the hiring one. The official unemployment level in Kalush was 7,9%, while in Ukraine it was 7%.
Innovations
Three years ago, by the strategic way of working, the city council determined the small and middle business.
Aiming at this, the municipal authorities:
The Enterprineurs’ Council at the city mayor is a constant analytical, consultative-advisory body, that was organized to join the enterprineurs to decision-making process, to organize the feedback between the enterprise subjects and the local governments by drawing the public to discussions and analyses of the city council’s decisions effectiveness.
The authorities provide the local normative-and-legal bases formation for the small and middle business successful development.
Taxation criteria depending on the natural persons’ activities that deal with enterprises have been elaborated, and the unified tax rates have been ratified according to the President’s Order “About the simplified system of smes subjects’ taxation, registration and accounting”.
Some of the city council decisions have been ratified concerning the trade patens value establishment, as well as the fixed tax rates, local taxes and collections. Some managing subjects working in the priority spheres are free of paying some local taxes and collections, as well as those coming into the local budget.
The Regulation “About the municipal foundation for smes support and development” has been ratified. In 1999 the foundation was confirmed in the amount of 42,7 thousand hryvnas and in 2000 – in the amount of 40 000 hryvnas.
City council mechanism for the smes support:
In 2000 smes have realized goods, provided services, etc. for 64,3 million hryvnas, which is 1,5 times more than in 1999, and 1,2 times more than in 1998.
The range of goods and services, that are provided to the citizens by smes:
The Results
Supporting smes is a priority task of the municipal authorities’ policy. For the moment in the municipality the process of the civilized market economy infrastructure formation is vivid. The tendencies of its development allow to claim that the smes business activity is increasing. Stabilization of the number of already registered structures and increase of the functioning ones are Characteristics of the smes development. By April of 2000 there were 68 small enterprises for 10 000 people. In the beginning of 1998 their number was - 53.
The municipal authorities’ policy in the given sphere fosters joining one’s own costs to resolving social-and-economic problems, working places creation, and forming the new social layer – the middle class.
Contact information:
Kalush
Ivano-Frankivsk oblast
1 Haharin Street
city council
Riznyk Stepan Vasyliovych,
City mayor
Phone # (03472) 22669
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