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Policy Update:

SME funding target in sight

Mr Fernando Trabada Crende

When the EU’s Seventh Framework Programme (FP7) first started some three years ago, a challenging yet realistic target was set: that at least 15% of the funding available under FP7’s key programme – the Cooperation Programme – be allocated to small to medium-sized enterprises (SMEs). This objective has not yet quite been achieved, with the current EU contribution to SMEs standing at 13.4%, but it is within reach as figures from the latest report on SME participation in FP7 ( 906Kb) reveal.

EU funding for research and innovation activities provides SMEs with the resources and opportunities to remain competitive in a global economy. SMEs currently account for 15.7% of all participants in the Cooperation Programme, which provides funding for collaborative research projects involving research institutes, universities and industry, including SMEs. The programme is allocated the largest amount of EU funding of all the framework programmes – EUR 32 billion – and the target is that some EUR 4.9 billion of this be allocated to SMEs. 'Less than a 2% increase in SME participation would help us reach the 15% funding target,' says Fernando Trabada-Crende, a member of the team responsible for monitoring SME participation in the Cooperation Programme.

The success rate for an application for funding from the programme is greater when SMEs are involved. 'We’ve discovered that a proposal with two or more SMEs in the consortium applying has a greater chance of being selected than if only one or no SMEs are in it,' says Mr Trabada-Crende. 'The EU proposal evaluators appreciate SME participation.' But while that should be enough incentive for SMEs to join the programme, there still appears to be some hesitation. Mr Trabada-Crende suggests the following reasons for this:

  • projects are too large and not in line with the SMEs’ strategies or capabilities;
  • topics of calls for participation in the programme are of less direct interest to SMEs than other types of organisation;
  • SMEs want to obtain concrete results that have a more immediate economic impact;
  • participation requires a substantial financial commitment from an SME;
  • SMEs need more support when writing proposals.

The Cooperation Programme comprises 10 different themes, ranging from Health and Transport to Energy and Information and Communication Technologies (ICT). Of all the categories, Nanosciences, nanotechnologies, materials and production technologies (NMP) and ICT have attracted the highest SME participation rates. However, the EU has contributed a smaller share so far to themes such as Food, Agriculture and Fisheries, Health, and Biotech. 'These are areas where it seems the topics of the calls for proposals seem to be of interest to SMEs, yet their share of the EU contribution – which is related to their share of the project budget – is lower than expected,' says Mr Trabada-Crende.

  • Contact:
    Fernando Trabada-Crende
    Head of the Operational Sector
    Unit - SME
    DG Research
    European Commission
    Tel. +32 22966558