The European Commission’s Entrepreneurship Action Plan seeks to make life easier both for Europe’s established business-people and for its budding entrepreneurs. It will focus on fostering entrepreneurship among young people, reducing the stigma of business failure, providing support for women and ethnic minorities, simplifying tax laws, and making it easier to take over existing businesses. A set of key actions have been drawn up to meet these objectives: • 1. Fostering entrepreneurial mindsets through school education. While most of the work in this field has to be carried out at national, regional and local level, the Commission aims to give support to policy development. • 2. Reducing the stigma of business failure. This action seeks to help change attitudes to failed entrepreneurs who are often stigmatised by investors, consumers and business partners. • 3. Facilitating the transfer of businesses. Taking over an established firm has advantages – an existing production structure, and established name, and a solid customer base, for example. The Commission wants to make it easier for entrepreneurs to take over such businesses, which generally have a higher survival rate than start-ups. • 4. Improving social security of new small business owners. ‘Small entrepreneurs’ do not enjoy as good coverage against personal risks – sickness, business failure and unemployment – as others in the job market. To make entrepreneurship a more attractive career path, this problem needs to be addressed. • 5. Tailor-made support for women and ethnic minorities. Identifying and exchanging good practice and addressing areas not covered by national measures will, the Commission believes, release significant business and job-creation potential. 6a. Facilitating SMEs’ business co-operation in the internal market. Ways must be found to make it easier for SMEs to identify partners and do business abroad. 6b. Fostering innovative clusters. Greater understanding of the processes and mechanisms through which clusters develop, as well as of methods to network them, is needed 7. More equity and stronger balance sheets. Banks are increasingly relying on strong balance sheets as evidence of creditworthiness. Ways must therefore be found to address the fact that SMEs have a relatively low share of their own capital in their balance sheets. •
8. Listening to SMEs. Responses to the Green Paper revealed the need for administrative simplification and a proper consultation process with SMEs, before new regulations and policies are introduced to allow policy-makers to support them.
• 9. Simplification of tax compliance. Tax matters take up a lot of SMEs’ time and money. At the moment tax compliance procedures are too complicated for SMEs, and need changing.
Fostering innovative clusters Respondents to the Green Paper consultation stressed the
importance of promoting regional networks or clusters as a way to help create a positive environment for business and entrepreneurship to flourish. According to the Commission, clusters encourage competitiveness, innovation capacities and the development of SMEs. In particular they can help SMEs generate critical mass, pool resources, find business partners, and access useful technology, knowledge and services. Many countries now support clusters to foster economic development and improve competitiveness. The new Member States and candidate countries harness them to drive change in the business community and support innovation in companies. With these benefits in mind, key action 6b will build on previous efforts to analyse the operation and impact of national and regional cluster policies and exchange experiences among regions and Member States. Among the activities to be supported within this key action are a study to identify and classify clusters in the EU, and a study to help policy-makers understand which elements of clusters are most effective in encouraging research and innovation. The IRC
network will examine its members’ relations with clusters, with a view to developing co-operation in this area. The Commission has recently launched a call for proposals to support transnational networking among clusters (further information about the call is available at http://fp6.cordis.lu/fp6/call_details.cfm?CALL_ID=172).
The IRE network’s plans The final sub-action will involve members of the IRE network. The
Commission will work with a group of member regions that have experience of working with clusters and networks, to define and test a model that can be used to forge strategic links among clusters within the EU. Drawn from 13 member regions of the IRE network, this group will examine the design, establishment, funding and implementation of cluster initiatives – and the impact they make. This work is expected to run until June 2006, although it may be extended further. The IRE Secretariat plans to hold a conference in the second quarter of 2006 to disseminate the results. Full details of the Entrepreneurship Action Plan can http://europa.eu.int/comm/enterprise/entrepreneurship/action_plan.htm be found at: