International activities of European SME

In 2009 EIM was contracted by the European Commission to undertake a study to map the level of internationalisation of European SMEs, to identify the main barriers, look into the association between internationalisation and the business performance of enterprises and to develop policy recommendations. A major element in the study was a large scale survey among 9 480 SMEs in 33 European countries. The telephone survey was carried out during spring 2009.

The study analysed all activities that put SMEs into a meaningful business relationship with a foreign partner: exports, imports, foreign direct investment, international subcontracting and international technical co-operation.
For DG Enterprise and Industry of the European Commission, the most relevant finding was that 25% of SMEs in EU27 export or have exported at some point during the last 3 years. However, this concerns for 50% activities within the internal market, so only about 13% of EU SMEs export to markets outside the EU.
In addition to the numbers presenting the state of internationalisation, the study presents evidence of the need to support greater internationalisation which has consequences for enterprise policy:

• International SMEs create more jobs: Internationally active SMEs report an employment growth of 7% versus only 1% for SMEs without any international activities.
• International SMEs are more innovative: 26% of internationally active SMEs introduced products or services that were new for their sector in their country; for other SMEs this is only 8%.
• Public support goes largely un-noticed: Only 16% of SMEs are aware of public support programmes for internationalisation and only about half of them actually use public support.
• European SMEs are more internationally active than US and Japanese SMEs. Overall, European firms are more active than their counterparts in Japan or the US. Even if only extra EU exports are considered they still perform better.
• Most often SMEs start international activities by importing. SMEs that both import and export started with import twice as often (39%) than with exports (18%).

Although a direct link between internationalisation and increased SMEs performance in terms of growth, job creation and innovation was established, one has to note that this is merely an association and not (necessarily) a casual relationship. Much more findings and also more critical remarks can be found in the full report that has been published by DG Enterprise and Industry on the website of the Commission.

PDF report