The SME Performance Review is one of the main tools the European Commission uses to monitor and assess countries' progress in implementing the Small Business Act (SBA) on a yearly basis. With an emphasis on the measures from the SBA Action Plan, the review brings comprehensive information on the performance of SMEs in EU coutries and nine other partner countries. It consists of two parts: an annual report on European SMEs and SBA country fact sheets.
Brussels, 19 November 2015 - The 2014/2015 annual report on European SMEs is now available. It presents good news: after years of downsizing, European SMEs are expanding, and have started hiring again.
The annual report, prepared on a yearly basis, provides a synopsis of the size, structure and importance of SMEs to the European economy and an overview of the past and forecasted performance of SMEs from 2008 to 2016. Comparisons with partner countries outside the EU and with the large enterprise sector are also included.
The SBA fact sheets present an assessment of the progress in the implementation of the Small Business Act at national level. They focus on key performance indicators and national policy developments related to the SBA's 10 policy dimensions in the 28 EU countries, Albania, the former Yugoslav Republic of Macedonia, Iceland, Montenegro, Serbia, Turkey and Moldova.
Click on a country on the map to see the fact sheet for the selected country.
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Albania, Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Former Yugoslav Republic of Macedonia, Germany, Greece, Hungary, Iceland, Ireland, State of Israel, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovak Republic, Slovenia, Spain, Sweden, Turkey, United Kingdom
Past and future SME performance: In Albania, over 80 % of all employment is in SMEs, compared to the EU average of around 67 %. Albanian SMEs provide about 68 % of the country's total value added, while the average in the EU is about 58 %. In 2013, value added dropped by 3.6 % compared to 2012. In parallel, employment increased by close to 10 %, and the number of businesses grew by 1.7 %. Real GDP is expected to grow by 3.3 % in 2015 and by 4.2 % in 2016. The growth is almost solely driven by internal demand. Forecasts also point to falling unemployment rates. Due to the fact that the Albanian economy is led by SMEs, it is expected that the projected economic upswing will result in increased SME employment and output growth.
Implementing the Small Business Act for Europe (SBA): The SBA profile of Albania is inconclusive, as many data are not available. Overall results thus need to be interpreted with caution. That said, Albania has undertaken important reforms to improve the business environment. A one-stop shop was set up for swift and inexpensive registration of new businesses. E-procurement has been introduced. Various administrative issues can be resolved online. Tax procedures have been simplified. Recent policy measures have mainly focused on entrepreneurship, 'second chance', 'responsive administration' and skills & innovation.
SME policy priorities: Further steps need to be taken to improve access to finance, such as developing the venture capital market. For businesses to find qualified staff, it is essential to continue setting up the framework for developing skills. Specific measures are required to strengthen the innovation capacity of SMEs. The introduction of incubators, clusters and technological parks deserves more emphasis. Enhanced public support is needed to increase exports of the Albanian SMEs. A full regulatory impact assessment is to be introduced for all legislative proposals affecting businesses.
Past and future SME performance: Austria´s SME sector has been one of the most resilient during the crisis. Since 2009, SME value added in the non-financial business economy has grown by 18 %. Employment and the number of SMEs have increased by 7.5 % and 9 % respectively. This trend is set to continue in the near future. In 2014-2016, SME value added is predicted to increase by 6 %. There will be an estimated 2 % rise in SME employment or a net increase of 35 000 jobs. The growth of micro enterprises is projected to be the most dynamic, with value added expected to rise by 7 % and the number of persons employed by 3 %.
Implementing the Small Business Act for Europe (SBA): Austria has a very competitive SBA profile, scoring well above the EU average in four policy areas: ‘second chance’, single market, skills and innovation, and environment. On the latter it is the EU´s top performing country. ‘Responsive administration’ is the one area where it trails the rest of the EU. Access to finance and skills and innovation pose the biggest challenges for the future, as in both areas the conditions for SMEs have worsened since 2008. There have been many policy initiatives in these areas, but not enough to cancel out the effects of the crisis. Overall, Austria has made good progress in implementing the SBA and most of its key provisions have now been fully addressed.
SME policy priorities: The deterioration in access to debt and equity finance requires policy instruments to be strengthened. The recently adopted legal framework for crowdfunding is badly needed to support equity financing for young start-ups. This in turn should also help to address the decline in SMEs’ innovative capacities. There are also some specific areas of 'responsive administration’ and ‘think small first’ in need of improvement. In particular, regulatory impact assessments need to be more detailed.
Past and future SME performance: The Belgian business economy is recovering from the crisis. Over 2009-2014, SME value added increased annually by 3.4 %, compared to 1.2 % for large enterprises. In terms of employment, SMEs saw growth of 12 % over the same period versus 3 % for large enterprises. Micro enterprises performed even better, with a rise of 18 % in employment and 28 % in value added. Unlike in most other European countries, the construction sector has also recovered from its crisis low of 2009. The outlook for growth is promising. In 2014-2016, SMEs are forecasted to create around 42 600 jobs, about 35 500 of them in micro firms.
Implementing the Small Business Act for Europe (SBA): Belgium has a SBA profile that is well in line with the EU average. Its strengths lie clearly with skills and innovation where it ranks fourth in the EU and ‘second chance’. Performance on the single market has improved since last year and now ranks within the EU top 10. State aid and public procurement and ‘responsive administration', however, score below average and have room for improvement. The least performing area of the SBA profile is entrepreneurship. Although the official statistics show a moderate increase in the number of start-ups, there is room to improve the enabling environment for entrepreneurship.
SME policy priorities: Business participation in public tenders should increase in order to approach the EU average. Several SBA areas have room to improve, mainly on costs, for example the costs of setting up a business, transferring property or importing or exporting. To lighten the high administrative burden the regions should introduce and systematically apply regulatory impact assessments and the 'SME test'.
Past and future SME performance: The performance of Bulgarian SMEs since 2008 has been mixed. They are estimated to have returned to pre-crisis levels of value added in 2014, but have not recovered jobs lost during the crisis: employment in SMEs in 2014 stood 7 % below the 2008 level. Forecasts predict a further 5 % increase in value added and a moderate 1 % rise in employment until 2016.
Implementing the Small Business Act for Europe (SBA): Bulgaria's SBA profile shows weak results in four out of ten areas. This is mainly due to continuous political volatility which results in an unstable and burdensome business environment. Bulgaria's performance in any SBA area is at best average and the profile does not show any area of excellence. On State aid and public procurement, access to finance and the single market the country is in line with the EU average. ‘Second chance’ and ‘responsive administration’ score below-average results, whereas the greatest room for improvement is in skills and innovation, environment and internationalisation.
SME policy priorities: Improving the attitude to businesses (‘think small first’) should be the main SME policy goal for the immediate future. It needs to go in parallel with improving the policy implementation process and making public administration more responsive to SMEs’ needs. Skills and innovation and opening up to international trade should stand next in line for improvements.
Past and future SME performance: SMEs in Croatia account for 55 % of total value added, and provide 67 % of total employment. Since 2008, the value added of Croatian SMEs has dropped by over 25 % and their employment by nearly 13 %. The outlook for the period 2014-2016 offers a gradual recovery. SME employment is predicted to grow by over 3 %, creating about 21 700 new jobs by 2016. SME value added is expected to increase by close to 5 %. The forecast is particularly encouraging for micro enterprises, as their value added is projected to rise by 9 % and their employment by 6 %.
Implementing the Small Business Act for Europe (SBA): Croatia's SBA profile shows the performance on most of the principles being below the EU average. Environment is an exception where the score is well above. Recently, however, various new policy measures were introduced, focusing particularly on entrepreneurship and access to finance and to some extent addressing the principles of ‘think small first’ and ‘responsible administration’.
SME policy priorities: There has been progress in reducing administrative burden, but more can be done to reduce it further. Cooperation among public bodies concerning SME issues should be strengthened. Systematic regulatory impact assessments and comprehensive ‘SME test’ are to be put in place. An efficient and transparent early warning system should be introduced to facilitate early restructuring of viable SMEs. The institutional framework for trade promotion is to be reinforced and a comprehensive strategy adopted to help SMEs to export.
Past and future SME performance: While Cypriot SMEs have been hit hard by reduced liquidity and the resulting drop in spending power in recent years, the recession receded somewhat in 2014. Some sectors are showing recovery, while others are still far below their pre-crisis performance. Over the 2008–2014 period, SME value added fell by a staggering 28 % and unemployment had risen to 16 4 % by the end of 2014. The general outlook for SMEs is mixed. SME value added is projected to increase in 2015 and 2016 by 8 % and 12 % respectively, while employment is expected to grow by 16 % compared with 2014.
Implementing the Small Business Act for Europe (SBA): Based on the assessed indicators, Cyprus presents a profile that is generally in line with the EU average. The areas of 'second chance' and skills and innovation experienced the most progress. New measures included the Central Bank of Cyprus's Code of Conduct to assist SMEs in restructuring their bank loans and the new Insolvency Law, which will act as a safety net for SMEs by giving them a second chance after bankruptcy. Access to finance remains challenging but there are signs of progress. The newly appointed SME envoy is making efforts to coordinate public and private SBA stakeholders and a special task force is looking into options to enhance entrepreneurship and transform the present bureaucratic system into a smart administration.
SME policy priorities: There is much room for improvement; especially in crucial areas such as access to finance, entrepreneurship and ‘responsive administration’. Developing the entrepreneurial skills of young people and bridging the gap between the qualifications they possess and those that SMEs need will not only help harness the self-employment potential of entrepreneurship but also the job creation capacity of SMEs. Further measures regarding waste management and renewable energy are urgently needed to safeguard the island's environmental future.
Past and future SME performance: The performance of Czech SMEs has stagnated since 2008. The pattern of development in employment in Czech SMEs closely resembled the EU-wide trend in this area. In 2014, employment in SMEs stood slightly below the 2008 level. Czech SMEs did not recover from the crisis in a similar way to the average EU SME. The value added of Czech small businesses stood considerably below pre-crisis levels for the entire 2008-14 period. In 2014, Czech SME value added hovered at approximately 90 % of the 2008 level and was forecast to remain below the pre-crisis level until 2016. Micro-companies dominated the business population to a significantly higher degree than in the EU.
Implementing the Small Business Act for Europe (SBA): The Czech Republic's SBA profile was mixed. SBA areas where it was performing well included state aid and public procurement, access to finance and skills and innovation. ‘Second chance’, ‘responsive administration’ and ‘internationalisation’ were the areas with the most opportunities for improvement. Between 2008 and 2014 the Czech Republic improved its performance in a number of SBA policy areas including ‘second chance’, ‘responsive administration’, ‘access to finance’, ‘single market’ and ‘skills and innovation’.
SME policy priorities: Most opportunities are currently to be found in expanding international trade and boosting SME access to markets, both in EU Member States and non-EU countries. The government should also promote entrepreneurship and improve the quality of public administration to ensure that Czech SMEs can flourish and develop.
Past and future SME performance: Danish SMEs provide about 65 % of the country's employment (compared to the EU average of about 67 %). They account for nearly 62 % of total value added (compared to the EU average of nearly 58 %). Recovering from the crisis, their value added increased by 10 % from 2009 to 2014. However, SME employment, which increased by 2 % in the same period, is not yet back to pre-crisis levels. Nevertheless, the outlook is optimistic. Value added of Danish SMEs is expected to increase by over 10 % from 2014 to 2016. At the same time, SME employment is forecast to rise by 3 %, creating about 31 800 new jobs by 2016.
Implementing the Small Business Act for Europe (SBA): Denmark's SBA profile is strong, providing a very good business environment for SMEs. It performs particularly well on internationalisation, skills and innovation and the single market, well above the EU average. Entrepreneurship however, remains below the EU average, despite considerable progress over the past few years. Since 2008, a lot of policy measures benefiting SMEs have been adopted. These include new funding schemes and significantly reducing the administrative burden and costs for SMEs.
SME policy priorities: Despite the government's efforts to improve the situation by introducing different financing instruments, it is still difficult for Danish SMEs to access finance, even if it is easier for them than for their EU counterparts. This is especially the case with regard to bank loans. Furthermore, despite having an insolvency framework that works well, it is still challenging for businesses in Denmark to re-start. This is because it may take several years after going bankrupt to get a discharge. The government has recently taken steps to address this.
Past and future SME performance: The ‘non-financial business economy’ has recovered from the economic crisis. SME value added has increased by 56 % since the crisis, and SME employment has risen by 6 %. Micro firms grew especially strongly. In 2014, there was a net gain of 11 393 businesses. In recent years, roughly 18 000 new businesses were registered annually, while the number of deregistrations steadily declined. The outlook for SMEs, and for the entire ‘non-financial business economy’, is very positive. SME value added is predicted to grow by 10 % in 2014-2016. In particular, micro firms will be driving this growth. Employment forecasts project a 1 % rise until 2016.
Implementing the Small Business Act for Europe (SBA): Estonia's SBA profile is generally strong. Estonia performs above the EU average in five SBA principles — it scores particularly well in ‘responsive administration’, access to finance, single market and internationalisation. Its scores for ‘second chance’ and environment are below the EU average. The main area of improvement since last year has been the single market.
SME policy priorities: SMEs have asked for supporting measures for business transfers in the area of entrepreneurship. Faster insolvency procedures are needed for ‘second chance’. On the environment front, more investment in energy-efficient solutions for buildings and traffic is needed to encourage SMEs to work in this area. In view of continuous emigration and the skills mismatch, the main priority is to increase vocational training involving all social partners. To encourage innovation, a continuous monitoring framework is needed to foster cooperation between companies, research institutions and technology centres.
Past and future SME performance: Finland's SME sector is recovering very slowly from the financial crisis that started in 2008. The recovery so far is only partial. While the estimated value added of Finnish SMEs in 2014 surpassed the 2008 level, the number of SMEs and number of the persons employed by them were still below the pre-crisis level. SMEs in manufacturing were particularly hard hit. The jobless recovery is expected to continue in 2015 and 2016. While value added and the number of firms are predicted to growth by 4 % and 2 % respectively, employment is expected to remain at current levels.
Implementing the Small Business Act for Europe (SBA): Finland continues to have one of the most competitive SBA profiles. It performs above the EU average in six SBA domains. It is most competitive in ‘second chance’ and ‘responsive administration’. The latter is also the area which has shown the biggest improvement in performance since 2008. In the majority of SBA areas, however, Finland's performance either stagnated or deteriorated compared to that of previous years. The decline was steepest in access to finance. The government has tried to counter this trend by introducing policy activities in these areas. Other policy areas of priority in 2014 and previous years were entrepreneurship and internationalisation.
SME policy priorities: The general focus needs to be on improving existing measures as opposed to introducing new ones. The introduction of a specific SME strategy based on the SBA would provide a visible framework for these measures. Priority areas should be improving SMEs’ access to finance, reducing administrative burdens and more SME-adjusted public procurement policies. To render the overall policy strategy of growth via internationalisation more effective, the various initiatives in the areas of entrepreneurship, access to finance, innovation and internationalisation need to be better coordinated.
Past and future SME performance: SMEs account for 99.8 % of businesses in France, which is in line with the rest of the EU. They provide about two thirds of total employment and account for nearly 58 % of total value added. The French economy has been developing at a relatively modest rate over recent years. The number of new business registrations stagnated in 2014 and early 2015. The number of SMEs is set to grow at around 0.4 % until 2016. SME employment is also expected to remain close to current levels. Nevertheless, the outlook for SME value added is more optimistic: from 2014 to 2016, it is expected to grow by nearly 5 %, which is almost double the projection for large enterprises.
Implementing the Small Business Act for Europe (SBA): France's SBA profile is solid and broadly in line with the EU average. Good framework conditions are in place for the creation of businesses, but their growth has been hampered by size-related criteria in regulations. In 2014, important progress was made in the area of public procurement, enabling SMEs - in particular recently established ones - to have easier access to public tenders. The bill for growth, economic activity and equal economic opportunities contains a number of policy measures aiming to cut red tape, stimulate investment and modernise the labour market. Opportunities offered by the single market remain to be seized.
SME policy priorities: While a real effort has been made to implement a simplification strategy, the overall business environment remains complex and unstable. This is due to continuous changes in legislation, and progress may be counteracted by new regulations being adopted without exhaustive impact assessments. It would therefore be beneficial to promote a more stable environment by focusing on major modifications in the regulatory framework, which themselves would bring extensive simplification. The French ‘SME test’ includes a set of instruments that are used on a case-by-case basis and could be used more widely. The ‘think small first’ approach could be extended further across the public administration.
Past and future SME performance: SMEs in the former Yugoslav Republic of Macedonia provide over 76 % of all jobs (as compared to about 67 % in average in the EU) and generate nearly 67 % of value added (as compared to roughly 58 % in the EU). However, their productivity is 80 % below the EU average. In the period from 2008 till 2013, SME employment increased by 14 %. SME value added also increased significantly, by 9 %. Real GDP is expected to grow by about 7 % between 2014 and 2016. Thus, further growth of SME employment and value added can be expected.
Implementing the Small Business Act for Europe (SBA): The SBA profile of the former Yugoslav Republic of Macedonia provides a mixed picture. While the principles of 'responsive administration', access to finance and entrepreneurship score above the EU average, environment, skills & innovation and internationalisation trail behind the EU average. Limitations in availability of data need to be taken into account while interpreting the overall results. Recent policy measures focused on entrepreneurship, access to finance, skills & innovation and on 'responsive administration'.
SME policy priorities: Vocational education and training framework needs to be enhanced further, as it is challenging for the SMEs, in particular more advanced ones, to find people with the necessary skills. Cooperation among the businesses and researchers should be reinforced. The 'SME test' is to be applied systematically. A more stable and predictable regulatory environment needs to be established. Internationalisation of SMEs should remain among the main points of interest for policy-makers. Further improvements in access to finance are also essential, including developing the venture capital market.
Past and future SME performance: The success of German SMEs throughout the crisis period of 2008-2014 is unique in the EU. The number of SMEs soared from 1 870 000 in 2008 to almost 2.2 million in 2014. The number of people employed in German SMEs is estimated to have increased by some 2.8 million to a total of almost 16 850 000 in 2014. The surge in total value added was estimated at 16 % across almost all sectors. This success story is set to continue at least for the near future. The number of SMEs is forecast to expand by 100 000 new firms in 2015 and 2016, creating an additional 820 000 jobs in the process. SMEs of all size classes are expected to create more jobs, most notably medium-sized ones with an expected increase of 3.1 % a year.
Implementing the Small Business Act for Europe (SBA): Germany's SME performance profile is still very competitive and an important explanatory factor behind the recent SME success story. In five SBA areas, it surpasses the EU average. However, there are two areas of some concern. In ‘responsive administration’, Germany trails the EU average, partly because improvements in the regulatory environment in the EU overall happened at a faster rate than those in Germany. As regards entrepreneurship, Germany's performance is still in line with the EU average, but there is evidence that the start-up dynamics are fading. Skills and innovation is also an area to watch. The country is still among the EU's top performers, but some innovation indicators suggest a gradual erosion of its competitive advantage.
SME policy priorities: The dwindling number of start-ups needs to be addressed. The scaling-up of entrepreneurship support programmes for the unemployed is one example of actions needed to accompany the existing selective and quality-focused approach to entrepreneurship. The existing coordination of entrepreneurship education measures by all those involved, most notably the Länder, needs to be reinforced. This is to be complemented by the full implementation of measures to cut red tape and for better regulation, announced in December 2014, and by an extension of venture capital support, most notably as regards crowdfunding and crowdsourcing. Additional steps to preserve its innovative edge, including through support for a greater take-up of IT-tools among SMEs, are also a priority.
Past and future SME performance: SMEs in Greece are still struggling with an economic contraction unparalleled in the EU. Employment in SMEs is estimated to have fallen by more than 450 000 between 2008 and 2014, to an estimated 1.8 million. Aggregate value added fell by 33 %. From 2013, there were signs of potential recovery. Between 2013 and 2014, the number of people employed by SMEs was estimated to have increased, albeit very modestly, for the first time since the crisis. Early predictions for 2015 and 2016 suggested modest growth, both in terms of SME employment and value added. However, due to ongoing discussions on the country's economic adjustment programme, forecasts for Greece are more uncertain than for any other EU country.
Implementing the Small Business Act for Europe (SBA): Greece's SBA profile is weak. In a number of areas it performs well below the EU average. These include ‘second chance’ (ensuring that honest entrepreneurs who have gone bankrupt get a second chance quickly), access to finance, skills and innovation, and internationalisation. ‘Think small first’ is another SBA area in which the country has yet to apply a number of key principles. There is no area in which the country performs above the EU average. However, since 2008 good progress has been made in some SBA areas, where it is in the process of catching up with the rest of the EU: the single market, skills and innovation, internationalisation and ‘responsive administration’. In access to finance and ‘second chance’, Greece lost further ground, especially in access to finance, in which it ranks last in the EU.
SME policy priorities: Action is needed on all policy fronts, but particularly on access to finance, ‘think small first’, ‘responsive administration’, and SME internationalisation, both within and outside the single market. In finance, access to credit needs to be substantially improved, especially by expanding the newly created support instruments. The ‘late payment’ directive also has to be applied as soon as possible. Administrative burdens have to be reduced by better coordinating government services, partly by applying the ‘only once’ principle. The introduction of an ‘SME test’ is a top priority.
Past and future SME performance: Although there are some encouraging signs, Hungary's SME sector is still some way short of sustained recovery. In the immediate aftermath of the 2008 financial crisis, the SME sector dropped by around 10 % in terms of number of businesses, employment and value added. Only in terms of value added has there since been a recovery. It rose by 12 % between 2009 and 2014, while employment fell by 2 % in the same period. The outlook for 2015 and 2016 does not point to a reversal of these trends. SMEs` value added is predicted to grow annually by 0.3 % until 2016, while the number of employees is expected to fall further by 30 000 between 2014 and 2016.
Implementing the Small Business Act for Europe (SBA): Hungary still lags behind the EU average in the majority of SBA areas. Environment, ‘second chance’, ‘responsive administration’ as well as skills and innovation are the areas causing most concern. In two areas — state aid and public procurement and access to finance — Hungary does better than the EU average. Improved access to finance is partly the result of sustained policy efforts since 2008. Other measures focusing on ‘think small first’ and ‘responsive administration’ have produced more mixed results. While a number of recent measures are expected to become fully effective in the future some reforms only partially addressed the problems or even led to an increase in bureaucratic burden on SMEs.
SME policy priorities: Regulatory impact assessments (RIAs) and stakeholder consultations have to be conducted more systematically. Also, transparency in terms of publication of assessments has to increase and consultation periods need to be extended. The ongoing e-government reforms need to be fully implemented and extended, in particular as regards public procurement processes so as to ease bureaucratic burden, increase transparency and competition and lower vulnerability to corruption. Support for innovation in SMEs has to be stepped up and conditions for ‘second chance’ entrepreneurs have to be improved by shortening insolvency procedures to less than one year, providing advisory services to SMEs in difficulties and launching public awareness campaigns to remove the stigma of business failure.
Past and future SME performance: Icelandic SMEs are still recovering from the financial crisis. Medium-sized companies were hit particularly hard. Although their output in 2012 was back to pre-crisis levels, employment in 2013 was still 16 % below it. In 2014, there were 2 050 business registrations, an increase of 6 % compared to 2013. However, the number of deregistrations was 2 164, leading to a net reduction of 114 business registrations. Expectations for the economy in general are optimistic. Real GDP is expected to grow by 2.4 % per year from 2014-16. In particular, SME employment and value added are expected to rise further in the coming years.
Implementing the SBA: Iceland’s overall SBA profile is very strong. The country exceeds all EU member states on access to finance. ‘Second chance’, ‘responsive administration’, skills & innovation, and entrepreneurship are also all above the EU average, even if the country's entrepreneurship level has been constantly deteriorating since 2008. However, the country is underperforming in the areas of environment and internationalisation.
SME policy priorities: Iceland should implement the Small Business Act, reduce the administrative costs of internationalisation, implement more measures to support SMEs to generate environmentally friendly products, help innovative companies to commercialise their new products and solutions, and provide ‘second chance’ support measures for honest entrepreneurs.
Past and future SME performance: Ireland's SME sector was one of the hardest hit by the crisis in the EU. Since 2011, there has been significant and sustained recovery. However, employment and value added are not yet back to pre-crisis levels. Manufacturing was the most severely affected sector. Some service sectors returned to pre-crisis levels or even surpassed those, including information and communication, real estate and professional services. SME employment is projected to increase by some 20 000 per year in 2015 and 2016. Value added is expected to grow by 4.5 % in 2015 and 5.3 % in 2016. Information and communication, real estate activities and professional services are expected to lead the SME recovery.
Implementing the Small Business Act for Europe (SBA): Ireland features one of the most SME-friendly environments in the EU. Its performance is above the EU average in six SBA areas. In ‘second chance’ and internationalisation, it is the EU's top performer. Since the SBA was adopted in 2008, conditions have steadily improved in almost all SBA areas. This recovery has been accompanied by substantial policy reform efforts in most SBA areas, with a particular focus on access to finance and entrepreneurship. Overall, Ireland has addressed most of the SBA recommendations.
SME policy priorities: Despite substantial efforts on the policy front and tangible improvements since 2008, access to finance remains a major challenge for many Irish SMEs. A number of new schemes such as the Strategic Banking Corporation of Ireland and the Ireland Strategic Investment Fund have been set up. Changes have also been made to government-supported micro-finance and guarantee schemes which experienced low uptake in the past. However, the effectiveness and impact of these initiatives can be judged only in the light of experience. In addition, alternative, non-bank financing requires stronger support in the form of loans and equity financing, such as peer-to-peer financing, seed capital and crowdsourcing and crowdfunding. A systematic SME test for ‘think small first’ still needs to be introduced. Also, SME consultations and the Regulatory Impact Assessments (RIAs) can be improved still further. RIAs should be carried out on all policies and, in each case, stakeholders' submissions should be analysed and the results published.
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Israeli SMEs were much less affected by the financial crisis which started in 2008 than their counterparts in the EU. Essentially, more SMEs were created, while employment in SMEs consistently expanded between 2008 and 2012. Value added somewhat decreased in 2009 but in 2010 it returned to the path of growth. These developments were mainly driven by strong internal demand and were supported by the appreciation of the Israeli currency (facilitating imports). The situation of export-oriented businesses was more difficult due to unfavourable conditions prevailing in the main export markets since 2008. Israel's SBA profile is strong on access to finance and on internalisation, while second chance and responsive administration offer the most considerable opportunities for improvement. Israeli authorities realise the need to improve regulation and to reduce the existing bureaucratic burden of regulation. The country stands to gain from the introduction of the Regulatory Impact Assessment and of the SME Test which are now both in the development phase. A new 'Digital Israel' National Initiative, expected to improve the quality of public services, is currently being developed.
Past and future SME performance: In terms of value added and jobs, SMEs play a more significant role in Italy than in most other EU countries, but their productivity, measured as value added per capita, is approximately 10 % below the EU average. The non-financial business economy has not yet recovered from the crisis. SME value added in 2014 was still about 10 % lower than in 2008. SME employment has dropped by approximately 9 %, and the number of SMEs has fallen by almost 4 %. However, by the end of 2014, more than 6 million companies are registered in the ‘non-financial business economy’an increase of approximately 0.5 %. The outlook for SMEs is not positive. Their value added is expected to fall by 2 % in 2014-2016. In particular, by 2016, SME employment is expected to drop by another 4 % compared with 2014.
Implementing the Small Business Act for Europe (SBA): In seven out of nine SBA areas, Italy performs below the EU average. Only in the areas of skills and innovation and internationalisation its performance is in line with the average. Since the beginning of the SBA in 2008, Italy has consistently improved results in the areas of ‘responsive administration’, skills and innovation, and particularly in single market. All other areas have remained more or less stable. The most critical areas remain access to finance and state aid and public procurement.
SME policy priorities: On access to finance, despite recent efforts, Italy needs to diversify funding options for companies and to bolster the banking sector's resilience. More effort on administrative simplification is necessary. Inefficiencies in public administration weigh heavily on Italy's competitiveness. Payments and bankruptcy procedures take too much time. The management of EU funds, particularly in southern Italy, needs to be improved, and corruption must be fought. Public procurement should be improved in a systematic way by applying central purchasing and e-procurement.
Past and future SME performance: Latvia's non-financial business economy made a fast recovery between 2009 and 2014. However, this recovery has still not fully offset the 31 % drop in value added suffered in the deep recession in 2009. SMEs have developed particularly well since the crisis but their value added in 2014 was still 12 % below its pre-crisis level. It is expected to grow by a healthy 5 % in 2015 and 7 % in 2016, while employment is forecast to grow by 1 % and 2 % respectively.
Implementing the Small Business Act for Europe (SBA): Latvia has a very strong SBA profile. It performs above the EU average in all but two areas: on skills and innovation it is below the average, while on environment it is in line with it. Latvia scores particularly high marks on entrepreneurship, ‘responsive administration’, state aid and public procurement and the single market. Over the past seven years Latvia improved significantly in a number of SBA areas, mostly thanks to several successful policies adopted in the wake of the crisis and to action by the business community. One of the main achievements was the increase of the private sector's involvement in R&D.
SME policy priorities: Attention needs to be given to helping SMEs turn environmental challenges into opportunities. Another pressing problem is the tight access to loans from banks. On skills and innovation, making vocational training more attractive remains a challenge. There is also insufficient cooperation between research institutions and businesses, which prevents improvements in R&D.
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Due to the positive economic development in Liechtenstein since 2009, the pre-crisis GDP level had already been exceeded in 2011. However, the Statistical Office of Liechtenstein calculated a slight decrease of 0.2% in the nominal GDP for 2012. Overall, during the crisis, Liechtenstein's SMEs performed well and employment in SMEs increased by 11% in the period 2008 - 2012. Export of goods in real terms increased by 1.2% in 2012, whereas imports decreased by 5.8 %. In 2013 exports shrank by 0.2% and imports grew by 1.7%. The recession in the Euro Area as well as the challenging economic dynamics in the neighbouring countries had, and continue to have, a negative impact on Liechtenstein’s exports. Export and import levels remain significantly low compared to pre-crisis levels (due to a strong Swiss Franc / Exchange rate - amount of goods increased). The slightly declining exchange rate of the CHF against the Euro, however, had a stimulating effect. The overall economic situation since the last quarter of 2012 seems satisfactory and enterprises were becoming increasingly optimistic. Liechtenstein pursues mainly an SME policy focused on the establishment of good framework conditions that support the competitiveness and innovativeness of local SMEs. Public consultations with SME stakeholders occur regularly in the legislative process and regulations are already ex-ante tested against their budgetary implications, availability of administrative capacities and impact on businesses. In the absence of a specific national SBA strategy, Liechtenstein concentrates on areas most conducive to its SME sector. Therefore, the most important progress made in 2013 has been in those SBA areas identified as urgent for strengthening the framework conditions of the SME sector, i.e. Responsive administration, Access to finance, Skills & innovation.
Past and future SME performance: SMEs have largely recovered from the crisis. Their value added increased by 8 % from 2008 to 2014. However, SME employment is still around 10 % below its 2008 level. In 2014, there were 12 146 new company registrations, a rise of 3 % compared to 2013. The outlook for SMEs until 2016 sees a strong increase in value added of 7.4 % annually. SME employment is expected to grow by 2.4 % in 2015 and by 2.5 % in 2016.
Implementing the Small Business Act for Europe (SBA): Lithuania has a strong SBA profile. In seven out of nine areas it scores above the EU average. Only on skills and innovation is it below the EU average. Since 2008, it has continuously improved its entrepreneurship and single market scores, while its skills and innovation and ‘second chance’ have steadily declined. Its scores for the rest of the principles remained stable. In 2014, the government adopted two important policy documents related to the implementation of the SBA — the Innovation Action Plan 2014-2017 and the Entrepreneurship Action Plan 2014-2020.
SME policy priorities: Its low level of innovation is the major challenge for Lithuania. This is compounded by the low level of private sector investment. The low level of innovation is also due to the lack of skills. As in other Member States the working age population is shrinking due to an increasing ageing population. The net emigration of young people has also contributed to the skills shortage. Vocational training should be targeted to the needs of the labour market. The ‘SME test’ needs to be used systematically. Interinstitutional cooperation could be improved.
Past and future SME performance: Luxembourg's GDP is expected to have grown by 3 % over 2014. Since 2009, its economy has grown continuously and SME value added rose sharply, by 25 %. SME employment has grown and the number of SMEs has increased, though only by a comparatively small 9 % and 7 %, respectively. Most sectors have now fully recovered from the crisis, with the exception of transport and storage, which is still marginally below its 2008 level. The outlook is somewhat positive, as from 2014 to 2016 SME value added is predicted to grow by 6 %. The number of SMEs is forecast to increase only marginally, however, by an annual 1%. Similarly, SME employment is forecast to grow by only 0.6 % annually.
Implementing the Small Business Act for Europe (SBA): The establishment of the High Committee on SMEs and its work on the 4th SME Action Plan are positive developments in the implementation of the SBA. The legislative process is ongoing for measures on introducing a simplified limited company, electronic archiving, administrative simplification, and reforming the legal publication system for companies and associations. Luxembourg's strengths are still ‘Access to finance’ and ‘skills and innovation’, although it recently started to lose its competitive edge in these areas.
SME policy priorities: The most pressing issue for Luxembourg is to finalise and publish the overdue 4th SME Action Plan, and then proceed with implementing it. SMEs should be further encouraged to participate in public tendering and improve their capacity to benefit from innovation. Luxembourg has low levels of entrepreneurial activity compared to other countries in Europe and has to boost its entrepreneurial culture. To help this, the bankruptcy law should be modernised soon.
Past and future SME performance: Malta's SME sector is one of the very few in the EU to have expanded throughout the crisis. Last year, it was estimated to have grown by 5.7 % in value added and by 4 % in employment terms. Between 2008 and 2014, the number of people employed by SMEs rose by 13 000 (14 %). While the expansion spanned most sectors, it was particularly strong in tourism and IT-related services. It is set to continue for the near future: the number of SME employees is predicted to rise by almost 5 000 (6 %) in 2014-2016 and SME value added by 13 %.
Implementing the Small Business Act for Europe (SBA): Malta has made good progress in implementing the SBA. It now features a balanced SBA profile. In the recent past, including last year, policy priority has been given to ‘think small first’, access to finance and entrepreneurship. There was also progress in making public procurement more accessible to SMEs and on innovation support. An important development in the reference period (2014 and the first quarter of 2015) was the introduction of a systematic SME test for all new legislation.
SME policy priorities: The systematic application of the SME test needs to be closely monitored. Also, the announced reorganisation of the licensing and permit system within the Malta Environment and Planning Agency (MEPA) needs to be put in place swiftly so as to simplify and speed up procedures. Finally, specific aspects of the consultation processes for new legislation have to be improved, including more feedback to stakeholders on how their input has been taken into account.
Past and future SME performance: SMEs have partially participated in the recovery of the Moldovan economy since 2009. Their value added grew by more than one third during 2008-12. It was a jobless growth, as employment fell by 2 %. In 2014, there was a net increase of 3 493 companies. Real GDP is estimated to rise by 9% in 2013-16 which should also lift growth in SME.
Implementing the SBA: As a new member of the COSME programme there are not yet sufficient statistical data available for Moldova. On ‘responsive administration’, the country performs in line with the EU average. On internationalisation, there is a big gap between the country and EU member states.
SME Policy priorities: A comprehensive SME test and the impact assessment on business competitiveness should be applied. Public administration is burdensome and needs to become business friendly. The low participation in international funding programmes should be improved to finance projects supporting the business environment. Training sessions on managerial skills and business development should be offered also on regional level.
Implementing the Small Business Act for Europe (SBA): The SBA profile of Montenegro presents a rather positive picture. Several principles score above the EU average, such as entrepreneurship and 'second chance'. Performance on 'responsive administration' is below the EU average. Limitations in availability of data need to be taken into account while interpreting the overall results. Policy measures introduced recently were mainly a continuation of those initiated in previous years. The focus was on enhancing skills & innovation, promoting entrepreneurship and providing access to finance.
SME policy priorities: Improving access to finance should remain a priority for SME policy-makers in Montenegro. The type and the volume of available financial support for SMEs need to be increased. Such funding is to be provided on more favourable conditions than has been the case over the past few years, including regarding requested collaterals. A framework for introduction and development of business angels and venture capital funding should be established. The absorption capacity of SMEs needs to be reinforced for funding to achieve a greater impact. Particularly export oriented SMEs, arising from various business sectors, need to be supported. Strengthening export capabilities will be indispensable for further growth, and this requires the allocation of additional public resources.
Past and future SME performance: The Dutch SME sector is estimated to have experienced its first year of full recovery in 2014. In the previous years only a small proportion of SMEs had seen their value added return to pre-crisis levels. The progress in some service sectors, especially those related to tourism, was particularly dynamic. By contrast, SMEs in construction and manufacturing are still well below their pre-crisis employment levels. In 2015 and 2016 the modest recovery is expected to continue. Until 2016 SME value added growth is estimated at 6.5 % and SME employment is expected to rise by 2.1 %, a net increase of some 70 000 jobs.
Implementing the Small Business Act for Europe (SBA): The Netherlands enjoys a competitive business environment. It has a generally strong SBA profile, though with isolated weak spots. In five of the SBA policy areas it exceeds the EU average. Entrepreneurship, ‘second chance’ and ‘responsive administration’ stand out. In the latter, conditions have improved significantly since 2008. Access to finance remains a challenge as is, to a lesser extent, public procurement. The Netherlands has made good progress in implementing the SBA, giving priority to entrepreneurship, ‘think small first’, ‘responsive administration’ and innovation.
SME policy priorities: Further measures to improve SMEs' access to finance remain a priority, in particular by easing financing conditions, including interest rates and collateral. At the same time, alternative finance instruments, including venture capital and crowdfunding, need to be reinforced and promoted among the SME community. The efforts to improve R&D results and turn innovative ideas into marketable products have to continue and the effectiveness of the measures already taken in this area has to be regularly reviewed.
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Intelligent use of wealth from petroleum resources and active use of monetary policy have prevented Norway from the worst of the financial crisis and supported their recovery from the recession. During the last year, the SME sector in Norway achieved a growth in employment of around 32 000 persons. Notably, this surplus was created solely by micro and medium-sized companies. Small companies actually accounted a loss of around 9 000 persons. The relative strength of the Norwegian SME sector seems to lie in the high productivity of its small enterprises which, in comparison with other countries, generate more turnover with fewer employees. Thus, small businesses were successful in increasing their value added by 18.5% despite the decrease in the number of employees. Norway provides a very favourable business environment for SMEs, with particular strengths in the SBA areas of responsive administration and second chance. The SBA profile of Norway remains far above the EU average. However, in three areas, namely entrepreneurship, access to finance, and environment some relative deteriorations have been detected which can be explained by the scarcity of private venture capital, the less pronounced will of the Norwegian population to be self-employed (which is linked to the fact that Norway’s labour market offers excellent conditions) and, surprisingly, the decline in the number of companies working in the field of “green economy”.
Past and future SME performance: Polish SMEs have not yet fully recovered from the crisis, with figures for the value added and employment they provide still below 2008 levels. The value added provided by SMEs has been steadily increasing since 2012 and is expected to reach, and exceed, its pre-crisis level in 2016. The level of employment provided by SMEs is likely to remain stable. SMEs contributed 50.5 % of the value added created in the 'non-financial business economy'. SMEs employed 67.8 % of people working in the 'non-financial business economy'. A higher proportion of businesses in Poland than in the EU as a whole were micro-enterprises (95.2 % compared with 92.7 %).
Implementing the Small Business Act for Europe (SBA): SMEs in Poland were able to access finance more easily than those in many other EU countries. Approximately 60 % of Polish SMEs did not, however, make use of external sources of finance. Conditions for small businesses in Poland were average in a number of areas covered by the SBA, including state aid and public procurement, ‘responsive administration’, entrepreneurship and environment. The main areas where performance needs to be improved are developing skills, nurturing innovation and engaging in cross-border trade – areas which, to date, have not been given sufficient attention. Poland's integration with the single market is also an area where there is particular scope for improvement.
SME policy priorities: Skills and innovation and expansion to foreign markets should be the main areas of focus for policy-makers in Poland. Designing and effectively implementing appropriate measures within the ‘new chance policy’ framework will be essential for improving current poor performance in the area ‘second chance’. ‘Thinking small first’ is not sufficiently integrated into all government policies and the impact assessment process is weak. Further improving the quality and transparency of public services (administrative, judiciary and education), including by providing e-services, should play a fundamental role in improving the business environment.
Past and future SME performance: SMEs account for 67 % of total value added in Portugal (against 58 % in the EU) and provide almost 79 % of total employment (against 67 % in the EU). The economy has not yet recovered from the crisis. Since 2008, SME value added has fallen by more than 18 % and SME employment by over 17 %. However, there are signs of a turnaround. Value added grew by roughly 2 % in each of the last two years, and SME employment increased by 3 % from 2013 to 2014. The outlook is positive as well. In 2014-2016, SME employment and the number of SMEs are both projected to grow by over 2 % in total, and SME value added by nearly 8 %.
Implementing the Small Business Act for Europe (SBA): Portugal's SBA profile is solid and broadly in line with the EU average. Portugal's score on entrepreneurship is the second best in the EU. Its performance on state aid and public procurement and access to finance is below the EU average but has improved over recent years. Recent policy measures have focused on boosting youth self-employment and reforming the public administration. Strong measures have been taken to cut red tape.
SME policy priorities: Significant public funds are available for SME financing, but the lack of private investment and venture capital is still a key issue. This is partly due to SMEs' high level of indebtedness. Business liquidity continues to be hampered by long delays in payments. Efforts to reduce the complexity of environmental licensing need to be kept up, particularly by ensuring the measures taken are implemented in practice. Shortage of qualified labour is another problem. Cooperation between businesses and science in R&D also needs to be strengthened and knowledge transfer improved. The ‘one-in, one-out’ approach was endorsed to prevent regulatory compliance costs from increasing, but the rules and methodology for implementing it are awaited. Compulsory impact assessments need to be introduced, rather than continuing to use them on a non-obligatory basis.
Past and future SME performance: Romania's non-financial business economy has not yet fully recovered from the crisis. In 2014 SME value added and SME employment were still around 12 % and 225 000 lower, respectively, than before the crisis. In 2014-2016 the number of SMEs is expected to increase by 6.2 %, around 190 000 new SME jobs are predicted and SME value added is projected to grow annually by 8.5 %.
Implementing the Small Business Act for Europe (SBA): Romania's SBA performance is below the EU average. However, it excels in entrepreneurship, where it is the EU leader. In four other areas Romania's performs broadly in line with the EU average. Lower scores were achieved on environment, single market and internationalisation. The main challenge lies in poor and still declining results in skills and innovation.
SME policy priorities: Investing further in education and training is crucial. More funding is needed to improve vocational training and align education with the needs of the labour market. Even though recent export figures register an all-time high, more effort has to be put into improving the export capacity of SMEs, for example through support services and co-financing. Better coordination of innovation policies is needed to create synergies between the public sector, institutions and companies.
Past and future SME performance: SMEs in Serbia account for 70 % of employment and 53 % of value added. From 2011 till 2013 SME value added stagnated at, approximately, the level of 2009. SME employment fell during the same period and in 2013 it was 8 % below the levels of 2009. The outlook for the Serbian economy shows upwards potential. However, some of the factors which restrained growth in 2014, such as fiscal tightening and lower inflow of investments, are still apparent in 2015 and are likely to continue to constrain SME growth in the next few years.
Implementing the Small Business Act for Europe (SBA): Serbia's SBA profile indicates a somewhat weak performance. On the positive side, the law on bankruptcy has been amended, allowing the non-fraudulent bankruptcy procedures to be completed in a simpler, faster and more cost-efficient manner. Entrepreneurship is the only principle in which Serbia scores above the EU average. Suboptimal performance marked the areas of 'responsive administration', access to finance and internationalisation. Limitations in the availability of data need to be taken into account when interpreting the overall results.
SME policy priorities: Administrative and regulatory requirements need to be reduced and simplified. Further support is needed for the internationalisation of SMEs, focusing on the sectors whose good performance stands out. Access to finance is still generally poor. Bank lending, crucial for SMEs, has become less available. Interest rates have lowered, but remain high. Therefore, alternative sources of financing should be developed. The methodology for the 'SME test' exists, but needs to be applied systematically.
Past and future SME performance: The figures for Slovak SMEs since 2008 have been affected by methodological changes in the collection of SME statistics as in 2010 the statistical definition of SMEs was considerably broadened to include the self-employed. Slovak SMEs incurred losses in value added and employment between 2011 and 2012. The figures for value added and employment stagnated through 2013 and 2014 and are expected to pick up in 2015 and 2016. The forecasts for 2014 to 2016 predict that SMEs’ value added will grow by 5 % and employment will fall by 1 %.
Implementing the Small Business Act for Europe (SBA): Slovakia achieved an above-EU average performance in the areas of access to finance and environment and average scores for entrepreneurship, state aid and public procurement, single market and skills and innovation. There was room for improvement as regards ‘second chance’ and ‘responsive administration’. The biggest challenge was internationalisation.
SME policy priorities: Slovakia needs to further stabilise its business environment. This should be achieved through a broader application of the ‘think small first’ principle, in particular through regulatory impact assessments, appropriate stakeholder consultation mechanisms and the SME test. Public administration needs to be made more transparent and address widely perceived corruption. It should also better respond to SMEs’ needs by providing higher quality services. E-government solutions, currently in an early phase, may play an important role in the process. Slovakia needs to continue to boost skills and innovation in SMEs and enable them to achieve their international potential.
Past and future SME performance: In Slovenia SMEs provide 63 % of value added and nearly 73 % of employment. SME value added grew by nearly 10 % over 2009-2014, while SME employment has fallen by 7 % since 2008. The outlook is mixed. Namely, SME value added is projected to grow by about 3 % over 2014-2016, while employment in SMEs is expected to decrease by 0.6 % during the same period.
Implementing the Small Business Act for Europe (SBA): Slovenia's SBA profile is balanced, with its performance in most areas broadly in line with the EU average. In 2014 there was some progress in implementing the SBA. However, the related measures were spread among many institutions, which made coordination and effective implementation difficult. Slovenia still lags behind most of the EU in access to finance and ‘responsive administration’, despite recent efforts and improvements in both these areas. The government plans to introduce the comprehensive ‘SME test’, including the related electronic tools, by mid-2016. The action plan for implementing the SBA has been included in the government's ‘single document’ setting out a large number of measures for improving the business environment.
SME policy priorities: The emphasis in implementing the ‘single document’ is to be put on reducing administrative complexity and administrative burdens, fighting corruption and increasing the efficiency of the public administration. Alternative financing mechanisms, including public-private partnerships, need to be strengthened. Banks' reluctance to provide loans may be addressed to some extent by creating a credit review office for SME lending. The electronic version of the comprehensive ‘SME test’ needs to be fully implemented. Upgrading of the infrastructure needed to make the full transition to e-procurement is to be completed.
Past and future SME performance: Spain's SME sector has still some catching up to do to regain pre-crisis levels. SMEs are 23 % and 29 % respectively below their pre-crisis capacities in terms of the number of persons they employ and their total value added. Between 2008 and 2014 an estimated net total of 2.4 million jobs were lost in Spanish SMEs. However, there are the first signs of a recovery. Estimates for 2014 for employment and value added show a slight increase on the 2013 figures. Also, the number of SMEs was estimated to have stabilised at around 2.35 million. Service industries are at the forefront of this nascent recovery and the outlook for 2015 and 2016 is modestly positive. The number of people employed in SMEs is expected to increase by about 100 000 during this period.
Implementing the Small Business Act for Europe (SBA): Spain's SME profile remains weak. As in previous years, ‘second chance’ is the only area where its performance excels compared with the EU average. Among the five areas where Spain trails the EU average, entrepreneurship and state aid and public procurement are the biggest challenges. For these areas, not only is the gap to the rest of the EU the largest, but conditions since 2008 have actually deteriorated. The situation is better for ‘responsive administration’, access to finance and single market. In these areas, performance has improved and Spain is catching up with the rest of the EU. With the exception of single market and internationalisation, Spain still has to implement important measures in all SBA areas, in particular ‘think small first’.
SME policy priorities: Spain has to progress on many policy fronts to bring its policy environment up the standards of other EU countries. A host of crucial measures have been adopted in the past two years and now it is paramount that these measures are implemented properly. The measures in question are: the introduction of the SME test and regulatory impact assessments (RIAs), thorough implementation of the Late Payment Directive and the introduction of entrepreneurship as a subject in the country-wide school curricula. Given the worrying trend in SME innovation, existing support measures have to be stepped up and complemented by additional instruments.
Past and future SME performance: In 2010, SMEs had already recovered from the crisis lows of 2009. In 2008-2014, their value added increased by 22 %. Recovery in employment was not as strong, though SME employment was still 5 % higher than in 2008. The outlook for the ‘non-financial business economy’ as a whole, and especially for SMEs, is positive. From 2014-2016 the number of SMEs is expected to increase by 5.4 %. It is estimated that SMEs will create approximately 100 000 more jobs by 2016, a rise of 4.7 %. During the next two years, SME value added is expected to improve by approximately 6.2 %.
Implementing the Small Business Act for Europe (SBA): Sweden's SBA profile stands well above the EU average in most areas. It shows excellent scores for access to finance, where the country outperforms all Member States. Internationalisation and skills and innovation are other particularly strong areas. Sweden's self-evaluation when it comes to SBA implementation has enabled it to detect potential weaknesses and work on them year on year. Since 2008 progress has been stable and clearly noticeable in most areas. The level of entrepreneurial activity remains low, given the overall encouraging policy environment. The commercialisation of innovation is another area with room for improvement.
SME policy priorities: Actively encouraging entrepreneurial behaviour and tapping the potential of young people and women, in particular, should be the focal points of SME policy. Cutting red tape still further and involving SMEs even more dynamically and visibly in policy design could break down barriers to entrepreneurship. Better focused public support strategies to encourage SMEs to invest in resource-efficient measures and the production of green products will improve Swedish SMEs’ ability to face environmental challenges.
Past and future SME performance: Since 2009, SMEs have fully participated in the upswing of the Turkish economy. Until 2012, their total value added and employment grew by almost 28 % and 35 % respectively, even though their number only increased by approximately 6 %. From 2013 to 2014, registrations of new firms increased by more than 16 %, from around 109 000 to around 127 000. Real GDP is expected to grow by 7 % until the end of 2016. Thus, further growth in SME employment and value added can be expected.
Implementing the SBA: The SBA profile of Turkey is balanced. The performance on most principles is broadly within the EU average. Entrepreneurship stands out on the positive side. Only in ‘responsive administration’ is the performance slightly below the EU average. Overall, since 2008 the country has kept a stable SBA profile. The SME Strategy and Action Plan (2015-2018) and the Entrepreneurship Strategy and Action Plan (2 015-2018), waiting for final approval, address several SBA principles. Recently, few significant policy measures were implemented, concerning entrepreneurship and access to finance.
SME Policy priorities: Regarding skills, the gap between SME needs and available skilled labour needs to be addressed. Vocational training and higher education programmes will be indispensable to bridge this gap. In general, various policy measures need to address 'traditional' SMEs and not just highly innovative ones. There is room for improvement in coordination among public bodies in implementing the SBA. Administrative requirements related to trade (customs documents) are still too burdensome. SMEs would also benefit from enhanced support for their internationalisation, such as training and coaching.
Past and future SME performance: The United Kingdom is one of the few Member States where the SME sector has recovered fully from the crisis. In 2014, the number of businesses classified as SMEs, the number of people employed by SMEs, and the gross value added these businesses created all surpassed their 2008 pre-crisis levels. The main driver of this recovery was the service sector. In manufacturing, meanwhile, growth has been more modest, with most manufacturing industries having not yet returned to pre-crisis levels of employment. The outlook for 2015 and 2016 is good. The number of SMEs registered for VAT or PAYE (pay-as-you-earn tax) is expected to increase by 1.4 %, creating approximately 170 000 additional jobs by 2016 (an increase of 1.7 %). The value added created by SMEs is expected to rise even more sharply, increasing by 13 % during 2015 and 2016.
Implementing the Small Business Act for Europe (SBA): The United Kingdom is performing very well in the areas covered by the SBA. It outperforms the EU average in six of the areas and is the highest ranking country for the area ‘second chance’. The country's performance is average in the areas entrepreneurship and the single market, but has improved significantly since the introduction of the SBA in 2008. The area where the United Kingdom shows its weakest performance continues to be state aid and public procurement, the only area where it scores below the EU average.
SME policy priorities: The United Kingdom has implemented the vast majority of SBA recommendations. In recent years, the country has been very proactive in introducing policies to improve conditions for SMEs, concentrating particularly on reducing the administrative burden, improving access to finance and strengthening SMEs’ innovative potential. Promoting entrepreneurship was also a priority. There is, however, scope for further improvement in business education. A number of initiatives have been launched recently in the area of public procurement, but more still needs to be done to strengthen SME's presence, in particular by making public tenders more accessible to SMEs. The lack of improvement in SMEs’ export performance also needs to be addressed, at least in the manufacturing sector where this problem has been specifically identified.
Database of SBA policy measures: Download the database of SBA policy measures: 2014-2015
Methodology notes: on SME statistics (748 kB), on compilation of SME policy measures and assessment of the SBA implementation progress (970 kB)
Definitions of SPR indicators (301 kB)
Please note: The fact sheets do not constitute a comprehensive assessment of country policies, but rather contribute to the assessments, and should be regarded as a supplement to, and not a substitute for, any other relevant in-depth studies of SME policies.
Compare the latest data on number of SMEs, number of people employed and value added in different countries, and compare data within each participating country on the relationship between SME size and these three variables.
Compare data from 2008-2014 on number of SMEs, number of people employed and value added within a country .
Compare detailed data on the SBA principles between two countries and with the EU average.
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Study on EU SMEs and subcontracting