State aids to small and medium sized enterprises: cases of Turkey and European Union

ABSTRACTMaster ThesisState Aids to Small and Medium Sized Enterprises:Cases of Turkey and European UnionAylin İDİKUT ÖZPENÇEDokuz Eylul UniversityInstitute Of Social SciencesDepartment of Public FinanceDevelopments that stems from social, cultural, political and economicaffects of globalization have led to worldwide great changes. At the same time,this process that have affected all current institutions and rules, have come outharmonization and competition problems among countries. On this account, theimportance of cooperative endeavors of countries has increased. Nowadays; infront of Turkey, there exists a very important period that aimed accession toEuropean Union.All of these developments have affected enterprises in Turkey especiallythose SMEs which can be defines as the locomotive of national economy, andthese effects have been seen strongly especially after the entrance to CustomsUnion. When we take the employment opportunities provided by theseenterprises and their effects in reducing the unjust national income distributioninto the consideration; we can easily assess that the faster the harmonizationprocess of Turkey to EU, the more this harmonization will contribute the nationalwelfare. In this respect, the reality, that SMEs that are the skeleton of Turkisheconomy should be supported by the government, has been discussed a lot inrecent years.After 1980 period, Turkey has opened her doors to global competition,has entered Customs Union and has accepted the criterion of global competitionas a member of World Trade Organization. Long-lasted membership process toEU has reached its last stage with the start of negotiation process by 3 October2005, and this process has have made the harmonization studies more efficientand crucial. The process has brought the vitality of supporting SMEs to improvetheir competitiveness on the way to harmonization with EU. Of course this willalso require the harmonization of legislation on state aids to SMEs. Thesestudies should be perceived by the government as a duty rather than anobligation.When we evaluate the process from such a perspective, we can set aimsof this study as; state aids to SMEs in Turkey and EU. The analysis of Turkishharmonization process in SME policies along with legislation to that in EU withdetermining the position of SMEs in both Turkish economy and that of EU takespart in the focus of subjects.Keywords: 1) SME 2) State Aids 3) Entrepreneurship 4) European Union 5)Coordination