This presentation was prepared in March, 2013. Just over 10 % of European small and medium businesses export outside of the EU. At the same time we see growth of European, national and regional, private and public initiatives directed towards internationalisation and access of new markets. Is it possible to amalgamate and coordinate some of those activities?

1. Mindaugas Danys
SME Envoy, Lithuania

2. 
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We talk about out of EU exports – the terrain
of 12 percent of EU SMEs
Virtually each country keeps hundreds of staff
both abroad and at home for trade (export) &
FDI promotion
EU offices operate in several target markets
Mapping exercises prove abundance of
resources and lack of coordination as well as
overlap in service provision

3. While everyone acknowledges this necessity to
develop a coherent European strategy, putting
this ambition into practise has proven to be
challenging.
Fragmentation of competence between different
institutions, diverging interests between
member states, different legal bases for
financial instruments have all hampered the
development of a single vision. (Eurochambres,
2011)

4. According to the EU SMEs 3 most important barriers for doing business
in markets outside the Single Market are:
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payment risks;
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difficult paperwork, i.e. bureaucratic procedures;
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lack of financing.
Non-financial business support measures score just a bit lower:
 lack of adequate market information;
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laws and regulations in foreign markets;
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different national technical standards.
Talking on 7 key markets, SMEs that are active on those markets feel
that the most important barriers are:
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knowledge of foreign languages;
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transport costs;
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lack of adequate market information;
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difficult paperwork, bureaucratic procedures (administrative costs);
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different business cultures in foreign markets.

5. “Non-financial support measures in the EU
Member States amounts to some € 3 billion.
The study confirmed once more that very few
support measures are properly evaluated.”
“3/4 (!) of all internationally active SMEs are not
aware of existing support measures. From
among the 27% that are aware, only about 26%
- which is 7% of all internationalised SMEs report using such support”

6. - There are clearly opportunities for SMEs in the main target markets, in
spite of the difficulties in developing international activities.
- There is a wide range of support offered to internationalising SMEs.
- Those internationalised SMEs that use public support are in general
positive about its effects.
- For instance, an increase in turnover of nearly 30% is reported by users
of public support.
- However, only around 7% of all internationalised SMEs use public
support and there are low levels of awareness of what is available.
- There are specific gaps in provision, uneven coverage across large
countries and lack of provision for enterprises from some Member States.
- Overall,
however, the problem is more one of
raising the profile of what exists already and
making it more coherent and efficient.

7. - Assistance to identify human resources in some countries;
- Information on the local business environment, in particular in
countries with an unstable regulatory environment.
- An on-line information portal with reliable, consistent and regularly
updated information in English would be very helpful.
- Information on market opportunities at regional level.
- In some countries there is a lack of matchmaking events for EU SMEs.
- Lack of coordination between organisers of trade missions.
- Assistance in finding reliable business partners in some countries.
- There are major differences in the provision of office facilities
between countries.
- In some countries the provision of information on technical standards
is better developed than in others.
- Interesting examples exist of providing coaching to EU SMEs, e.g. on
contract negotiation practices.

8. good business support should:
- Adopt a perspective that begins with the actual
needs of European SMEs, rather than concentrating
simply on what agencies can currently provide.
- Aim to make support comprehensive and coherent,
accessible and affordable.
- There is a variety of support offered, often
responding to local circumstances, but frequently not
provided on a sufficient scale or available to all EU
SMEs.

9. - Avoid multiplying stand-alone initiatives that do not
relate to other aspects of business support.
- Aim to help enterprises build their general
management capacity, as well as addressing the
immediate problem.
- Provide services that are adaptable to the differing
needs of different kinds of SME (different stages of
development, different sectors, different target
markets etc.).
- Have built-in monitoring and evaluation
mechanisms, to ensure a continuous
improvement of provision.

10. 
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The Member States have on average each 8 support
service organisations, administering 27 services;
Concerning the kind of support services the top 3
most frequent types to assist SMEs with are:
exporting, technical cooperation, becoming a
subcontractor;
By service characteristic the top 3 of most frequent
support services are for advice& consultancy,
seminars and workshops, business cooperation and
networking. The non-financial support services
outnumber the financial support services;
The support services are mostly provided by special
public agencies and government organisations.

11. For the priority third countries it can be concluded
that:
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These countries have on average each 5 support
service organisations, which administer 18
support services;
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About 70% of all support services in these
countries are for firms of all sizes (as against
67% in the Member States).
189 out of 422 support services in third countries
(45%) are open to SMEs from all EU countries

12. The highest numbers of support services from
EU countries are targeted to Ukraine (162),
Turkey (152) and China (150). For these third
countries Member States may have unnecessarily duplicated support services.
The least support services targeted by EU
Member States are Saudi Arabia, Morocco and
Taiwan.

13. In the EU about 64% of the support services are
only open to business of the same country.
No more than 25% of the support services in the
EU are open to SMEs from all EU countries.
Austria, Malta, Poland, Denmark, Germany and
Finland have a relatively high share of support
services that are only provided to businesses in
their country.
Cyprus, the Netherlands, Latvia, Estonia and
Hungary have a relatively high percentage of
services provided to all EU countries.

14. successful EU initiatives will be those that can
build on the capacity of existing service
providers, thus creating synergies and
developing a shared ownership between
member states and the EU.

15. Let‟s agree on the “criteria” for determining the
“European value added”

16. full involvement of private sector
representatives, both in the target markets and
at home, on the basis of shared ownership and
shared responsibility is key to success.

17. 
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SMEs have a chance dramatically increase
their ability and access to services &
information
Decrease in cost of information
Possibility to specialise
Possibility to increase scope of services
provided and number of SMEs serviced

18. 
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National rivalry
Discrimination
Duplication

19. 
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Large countries can expand their services,
capacity and reach
Small countries can become a niche players
North – South & West – East dimensions, e.g.
Poland in Ukraine
Traditional strongholds can be utilized and
services build up (e.g. Lithuania well
connected in Belarus and Russia)

20. Large countries are sceptical of Pan
European/EU funded initiatives therefore we
need to look into:
 Bilateral & multilateral agreements
 Jointly serviced trade offices
 Joint trade missions
 Utilization of EEN
 Multicountry export oriented clusters
 Proactive mediation of COM & European
business assoc. among stakeholders

21. 
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Enhanced EU economic diplomacy can
contribute significantly to strengthen the
competitive position of EU SMEs.
Member states need to revise their economic
policies in coherence of other countries and
the EU institutions
Compromises for joint actions and framework
need to be concluded
It„s benficial for each member state to
cooperate on SME internationalization issues
Flexibility and effectiveness

22. Mindaugas.danys@ukmin.lt
Lithuania