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Small and Medium-sized Enterprises Policy

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					Competitiveness
Enhancing the European economy's competitiveness is one of the main priorities of the
European Union. In 2002, by the merger of the Internal Market Council, Industry Council,
and Research Council, a Competitiveness Council was created, which should make sure that
the EU has a comprehensive competitiveness policy and ensure the long-term economic
growth of the EU, across sectors, within all the EU' s policies.

So far the most important formulation of the EU policy for enhancing competitiveness is the
Lisbon Strategy, adopted by the European Council Summit in Lisbon in March 2000. This
plan reacted to the serious and long-term weaknesses of the economic performance and
competitiveness of the EU countries, mainly in relation to the USA. The Lisbon agenda was
supposed to transform the EU into the world's most competitive and most dynamic economy
by 2010 built on knowledge, capable of sustainable economic growth, offering more of better
jobs and improved social cohesion. The EU intended to achieve the objectives set in the
Lisbon Strategy by:

   promoting an economy and society built on knowledge, promoting research and
    development,
   modernising the European social model and promoting employment,
   removing barriers in the internal market and improving the entrepreneurial environment.

However, reaching the Lisbon objectives proved to be very difficult. In November 2004, a
group of independent experts carried out a review at the request of the European Commission,
to assess the Lisbon Strategy's first cycle, to identify causes for the modest progress and to
propose further a procedure for fulfilling the Lisbon objectives. On the basis of the expert
report, the European Commission changed the Lisbon agenda's concept and also proposed
institutional changes relating to the management of the entire process. Economic growth and
the promotion of employment became the priority for future years. The agenda has been
narrowed into ten priority areas focused on three main objectives:

    to make Europe a more attractive place for investments and employment,
   knowledge and motivation for growth,
   creating more of better jobs.

Following the recommendation of the European Commission, the European Council launched
Partnership for Growth and Employment, the aim of which was to enable the member
states, the European Union and social partners to achieve a common goal — speeding up the
reforms necessary for promoting economics growth and employment. The basis for the new
structure of the Lisbon Strategy was given by organizing the Lisbon programme into three-
year cycles and establishing regular annual reports at the Community level (Community
Lisbon Programme) and reports at the national level (National Reform Programmes).

The newly proposed document entitled Integrated Guidelines for Growth and Jobs 2005 –
2008 established a framework for the priorities of the member states' economic policies in
relation to the revised Lisbon Strategy. On the basis of this initiative, each member state
adopted its own National Reform Programme. This is an important political document
summarising a member state's priorities and measures in macroeconomic and microeconomic
areas and the employment policy, the aim of which is to stimulate economic growth and
employment in the coming three-year period.
The new three-year cycle of the Lisbon Strategy for growth and employment will be
commenced by the adoption of Integrated Guidelines for Growth and Jobs (2008 – 2010)
in the first half of 2008, when a crucial discussion is expected on the directions and priorities
of the Lisbon strategy. On the basis of the new integrated directions, the EU member states
will adopt National Reform Programmes in November 2008 for this new cycle of 2008 -
2010.



Small and Medium-sized Enterprises Policy
The Small and Medium-sized Enterprises Policy is one of the pillars of the Lisbon Strategy. It
focuses on creating favourable conditions for founding and the successful growth of small and
medium-sized businesses. Small and Medium-sized Enterprises (SME) represent a significant
portion of the European economy. They constitute 99 % of businesses in the EU and create
two thirds of jobs in the private sector. They can thus contribute significantly to speeding up
long-term economic growth; they are a source of new job opportunities and innovations. The
European Commission supports SMEs in Europe by a number of measures and programmes.

The EU' s first main programme document for the support and development of SMEs - the
European Charter for Small Enterprises, was adopted in 2000. Through this initiative, the
member states have committed themselves to support the development of a favourable
entrepreneurial environment for SMEs. In the Charter, the EU member states declare support
for an innovative and entrepreneurial spirit, creating a legal, tax, and administrative
framework supporting entrepreneurial activities, facilitating access of SMEs to markets, top-
class research and technologies, improving access to financial resources and support of
excellent small enterprises.

Following the European Charter for Small Enterprises, the European Commission adopted a
new strategy for SMEs in 2005 - Modern SME Policy for Growth and Employment. It's
aim is to ensure proper and effective coordination of all EU policies from the viewpoint of
SMEs and to harmonise measures for SMEs at both national and supranational levels. The
Strategy presses for improving the entrepreneurial environment for SMEs, reducing the
administrative burden, simplifying and speeding up administrative procedures and enhancing
the competitiveness of SMEs. One of the main principles of this new SME Policy is the
consistent application of the rule “Think Small First”. In the revised Lisbon Partnership for
Growth and Employment of November 2005, the European Commission has undertaken to
include this principle in all Community and national policies. In compliance with this
principle, all initiatives within European and national policies have to be assessed from the
viewpoint of their impact on small businesses.

Through an Envoy for SMEs, the European Commission maintains an active dialogue with
representatives of small and medium-sized enterprises. The European Commission's initiative
entitled ―Better Regulation” should systematically reduce bureaucracy and reduce the
administrative burden for SMEs by 25% by 2012 .

Within the new Lisbon Cycle of 2008 – 2010, the EU has witnessed a crucial change of
approach towards SMEs. The European Commission intends to pay more attention to SMEs
and underlines the need for consistent promotion of their interests at both national and
European levels. In July 2008, the European Commission presented a document entitled
Small Business Act for Europe, which is the conclusion of the activities of Barosso's
Commission on SMEs. The Act contains a combination of legislative measures, political
obligations, and particular practical actions, essential for the growth of SMEs, improving their
access to markets and financial resources. Its main objectives include:

   simplifying the conditions for entrepreneurship for SMEs, improving the entrepreneurial
    environment and reducing the administrative burden,
   simplifying the access of SMEs to the EU' s internal market and to markets of third
    countries,
   simplifying the access of SMEs to capital, innovations, and eco-innovations.


Priorities of the Czech Presidency within the European SME Policy

The Small and Medium-sized Enterprises Policy is one of the priorities of the Czech
Presidency. The new cycle of the Lisbon Strategy will put emphasis on the role of the Small
and Medium-sized Enterprises Policy, including measures to be adopted both at the EU level
and the national level. The Czech Presidency will engage in implementing the European
Small Business Act. Furthermore, it will support the application of the principle ―Think Small
First‖, particularly in the area of Better Regulation and Community programmes, such as the
Framework Programme for Competitiveness and Innovations (CIP 2007 - 2013). The Czech
Republic will further take an active part in activities supporting SMEs and entrepreneurship,
taking place within the so-called ―European Entrepreneurship and SME Week” in May 2009.

The Czech Presidency will also cover the regular assessment process of the new National
Reform Programmes within multilateral examinations in the Council working groups.
Fulfilling the Lisbon Strategy's objectives will again be included in the annual Progress
Report prepared by the European Commission. The Czech Presidency's task will be to
formulate a mutually consistent message of the Council formations towards the Spring EU
Summit. The Czech Presidency will also support the stability and continuity of the whole
process with regard to the current challenges and opportunities for Europe within debates on
the Lisbon Strategy's future after 2010.

				
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