Europe's small and medium-sized enterprises are the engine of the European economy and the main drivers for achieving sustainable growth and more and better jobs. At EU level, the European Commission has developed a comprehensive SME policy, which aims to ensure that Community policies and actions are small-business friendly and contribute to making Europe a more attractive place for setting up a company and doing business.SME's, European Commission, financing opportunities, private and governmental policies

Pop (Bandi) Ramona

English

Research Papers in Economics

￿
774 
EUROPEAN POLICIES FOR THE STIMULATION OF THE DEVELOPMENT 
OF SMALL AND MIDDLE SIZE ENTREPRISES 
Pop (Bandi) Ramona 
Universitatea Transilvania din Bra￿ov, Facultatea de Stiin￿e Economice 
 
Europe’s small and medium-sized enterprises are the engine of the European economy and the 
main  drivers  for  achieving  sustainable  growth  and  more  and  better  jobs.  At  EU  level,  the 
European Commission has developed a comprehensive SME policy, which aims to ensure that 
Community policies and actions are small-business friendly and contribute to making Europe a 
more attractive place for setting up a company and doing business. 
Keywords : SME’s, European Commission, financing opportunities, private and governmental 
policies. 
 
Cod JEL lucrare: M31 
 
Introduction 
 
The Small and Middle Size Entreprises represent the engine of European economy and are also 
the most important driver of new jobs and economic growth. The European Commission through 
its actions, sets the needs of the small enterprises in the center of its policies. The European 
Commission  develops  and    applies  a  variety  of    political  measures  especially  conceived  to 
supoort the SMEs in Europe. These policies have in view to create those conditions on which  the 
SMEs can be created and be prosperous. But the SMEs will have the main role, if the EU follows 
its objectives of acceleration of the economic growth and creation of  more and better jobs. 
The new strategy of the Commission in the field of the SMEs aims to apply the principle „think 
small first” that allows the improvement of the business environment for the SMEs, the reduction 
of administrative costs, the simplifying  and accelerating  of the compulsory procedures , the 
improvement of the access of the SMEs  to the markets and the growth of their competitivity. The 
member  states  have  taken  responsibility,  through  the  European  Chart  for  the    the  Small 
Enterprises, to develop a favourable   business environment  for the SMEs.One of the main 
objectives of the Community action is to allow its member states to benefit of the experience of 
their omologation  and make use of its policies. This way everyone may become aware of the 
good practices and can apply them in his case. 
The Commission has innitiated a proces of reduction of the bureaucracy  the firms are confronted 
with  and  revises  the  existing  community  legislation,  aiming  to  eliminate  the  unuseful 
administrative requirements. Also the member states are asked to follow the example of the 
Commission. According to the estimates; this exercise may reduce the administrative costs by 
25%, costs that are presently paid by the SMEs. 
The  new  Community  policy  on  small  and  medium-sized  enterprises  (SMEs)  creates  a  more 
coherent, pragmatic and horizontal framework for these enterprises. It aims to unlock the vast 
untapped potential of SMEs to create growth and employment within the European Union. SMEs 
will become more competitive, due to the promotion of entrepreneurship, improved access to 
internal and external markets, simplified Community legislation, improvement of their growth 
potential and an effective partnership with SME stakeholders. 
Small  and  medium-sized  enterprises  (SMEs)  make  a  major  contribution  to  growth  and  job 
creation in the European Union (EU). This is why the new policy on small and medium-sized 
enterprises  (SMEs)  creates  a  more  coherent,  pragmatic  and  horizontal  framework  for  these 
enterprises. ￿
775 
Promoting entrepreneurship and developing an environment favorable to SMEs will allow them 
to become more competitive. SMEs are very diverse, and consequently have different needs to 
become more competitive. Some are active in vast markets, others in local or regional markets. If 
by definition all SMEs have fewer than 250 employees, some are micro-enterprises, others are 
family SMEs. In order to unlock the growth potential of SMEs as a whole, policies and action to 
support them need to reflect this diversity. 
The success of this new policy will depend on the effective involvement of all SME stakeholders, 
national, regional and European, public and private. 
 
1.Policies in the field of the SMEs  
The SMEs are responsible for a great proportion the economic and vocational  activity in Europe. 
This  governmental  policies  must  be  adopted that  should  contribute to the  stimulation  of  the 
development of the SMEs.  
 
1.1 Presentation of the main financing opportunities granted to the SMEs 
The Capital is essential for the start of development of a company, but to find out the most 
adequate financing form is very often a major obstacle for the small and middle size enterprises. 
The investors and the banks often avoid paying the initial costs of foundation of the SMEs due to 
the implied risks. Sometimes the entrepreneurs do not entirely understand the concerns of the 
investors  or  the  banks,  fact  that  makes  it  difficult  to  find  the  necessary  financial  support. 
Presently, the European Commission is implementing a number of programs especially granted 
tot the environment of financial improvement of the SMEs in Europe. 
The European Union offers support to the small and middle size enterprises in Europe. 
This may be found under different forms, like subventions, loans and in some cases –guarantees. 
The support may be offered directly, in the forms of the programs managed under national or 
regional level - as the Structural Funds of the European Union. Also, the SMEs may benefit of a 
variety of non-financial consultancy measures offered as programs and services of support for 
enterprises. 
This tool aims to present the main community programs existing for the SMEs and contains 
a short description as well as the main sites of each program.  
The  European  Commission  collaborates  with  national  authorities  at  the  improvement  of  the 
financial environment for SMEs. Through the organization of experience interchanges and good 
practices between the national governments, the Commission has allowed many member states to 
bring concrete improvements to the financial environment for the SMEs. Also the Commission 
has taken floor in the dialogue between bankers and SMEs in order to identify and reduce the 
main obstacles that the small enterprises may come across when looking for a financing form.  
 
1.2 An adequate legal framework for the stimulation of the development of the SMEs. 
Presently the European Union undertakes huge efforts  to reduce bureaucracy inside the existing 
legislation as well as in the legislative propositions. For the beginning, the Commission has 
rejected  68  projects  of  laws  in  2006  and  other  ten  projects  in  2007.  For  the  beginning  the 
Commission works at the diminishing of the number of laws that has in view the simplifying of 
the SMEs’  activities. These include the reduction of the reporting imposed by the accounting 
regulations, the reduction of costs for the trans-border taxes and the simplification of the customs 
procedures. We have to assure the fact that the new laws do not make the activity of the SMEs 
more difficult bit have in view their needs.  
This is a part of the principle “think small first”, introduced by the Commission in 2005, once 
with the presentation of the new policy regarding the SME’s. All the legislative propositions have 
as object of a thorough verification regarding their potential impact on the SMEs. ￿
776 
 
1.3 Guarantee of the loyal competitiveness  
A unique competitive and open market is the best guarantee offered to the SMEs, that follow to 
increase the effectiveness and their innovation potential. Thus the EU has introduced a powerful 
policy  in  the  field  of  competitiveness  which  should  protect  the  SMEs  against  the  non-loyal 
competitions  of  other  economic  agents.  Without  neglecting  its  engagement  for  a  free 
competitiveness in Europe, the Commission updates its regulations in order to encourage the 
national and regional authorities to further redirect the public subventions. The Commission will 
continue to reduce the controversial actions and those which modify competitiveness in favor of 
the national champions and in change to sustain those measures that contribute evidently to the 
intensification of growth and job creation. 
Because the European SME’s have the biggest growth potential and of new job creation, 
the small firms will be the first ones to benefit of these measures.  
A particular field the Commission is concentrated upon is the prevention of abuse of dominant 
position.  The  large  firms  that  exploit  its  power  of  market  in  order  to  eliminate  the  smaller 
competitors are implicated in anticompetitive practices that are forbidden by the Community 
legislation.  The  Commission  grants  a  special  attention  to  the  complaints  made  by  the  small 
enterprises that reflect such situations. 
Also, such fusions are forbidden that create or consolidate a dominant position, impeding such 
potential abuses that may come afterwards. Generally the mergers which imply SMEs are not 
object  of  a  Community  control,  because  these  cases  do  not  have  a  European  dimension. 
However, some arrangements between the large companies can damage the competitors, against 
the smaller enterprises. The most familiar examples are the arrangements regarding the prices or 
the cartel in which the companies establish as commonly agreed the level of prices, thus the 
clients cannot benefit of the competition between the suppliers in order to obtain lower prices. 
On the other hand the arrangements between the SME’s are to a high extent exempted from the 
interdictions stipulated in the Community treaties.  
These should be able to protect from the competitors from abroad who do not observe the rules. 
The  objective  of  the  European  commercial  protections  tools  TDI  is  to  protect  the  European 
companies from the commercial un-loyal practices from the third countries, as well as against the 
dumping or subventions that negatively transform the market. Also, these instruments protect the 
European  producers  in  case  of  some  strong  and  instant  waves,  of  unforeseen  import.  The 
antidumping  anti-subvention  measures  aim  to  reestablish  of  an  efficient  and  loyal 
competitiveness on the inner market. These instruments have an important role for the SMEs. 
The Commission has initiated communication and counseling actions especially by the Euro-Info 
Centers wanting to assist the SMEs in their work with these instruments. 
Also an assistance office was launched for the SMEs. At the same time the Commission views 
upon  the  third  countries  in  order  to  verify  whether  these  use  the  commercial  protection 
instruments  legally  and  correctly,  directed  against  the  EU.  In  case  needed  the  Commission 
intervenes to guarantee the access of the European companies on the third country markets many 
representing a problem to the SMEs. 
 
Conclusions 
The development policies of European level aim to improve the existing situations, to eliminate 
the existing disfuntions, the balancing of the future development and consolidate the developing 
directions.  
According to the specific situation  on local level the,  development policies may be separated as: 
- policies based on opportunities that allow the  contractation of weaknesses - combinations that 
support strategies directed towards change; ￿
777 
- policies based on opportunities sustaining strengths – combinations  that sustain  offensive 
strategies; 
- policies based on weaknesses and threats –combinations that support defensive strategies; 
- policies based on strengths and threats – combinations that sustain diversified strategies.  
For each one of the given policies development programs are proposed, as general formulas, 
which at the stage of the action plan  will turn into groups of projects, whose accomplishment 
will lead to the implementation  of development policies. 
The success in solving the problems of economic development of the SMEs and of implementing 
the adopted policies can be attained only through collective efforts of the governmental, private 
and non-governmental sectors. 
 
References 
1. European Parliament Resolution on a strategy for the simplification of the regulatory 
environment (Rapporteur: MEP Giuseppe Gargani ref. A6-0080/2006 – PA_TA-PROV 
(2005/2006). 
2. European Council (15 and 16 December 2005): Conclusions of the Presidency
http://ec.europa.eu/enterprise/policies/sme  
3. http://ec.europa.eu/enterprise/entrepreneurship/docs/financing/sp_2008_ro.pdf 
4. http://www.habitatmoldova.org/publications/29/ro/dezvoltare%20economica%20locala.DOC 
   

European Parliament Resolution on a strategy for the simplification of the regulatory environment (Rapporteur:

EUROPEAN POLICIES FOR THE STIMULATION OF THE DEVELOPMENT OF SMALL AND MIDDLE SIZE ENTREPRISES

http://anale.steconomiceuoradea.ro/volume/2011/n2/112.pdf

EUROPEAN POLICIES FOR THE STIMULATION OF THE DEVELOPMENT OF SMALL AND MIDDLE SIZE ENTREPRISES

Abstract

Similar works

Full text

Available Versions

Research Papers in Economics