Europe’s 25 million small and medium enterprises (SMEs) are the backbone of the EU economy. They employ around 100 million people, account for more than half of Europe’s GDP and play a key role in adding value in every sector of the economy. SMEs bring innovative solutions to challenges like climate change, resource efficiency and social cohesion and help spread this innovation throughout Europe’s regions. They are therefore central to the EU’s twin transitions to a sustainable and digital economy. They are essential to Europe’s competitiveness and prosperity, economic and technological sovereignty, and resilience to external shocks. As such, they are a core part of the achievement of the EU’s industrial strategy.
SMEs are deeply woven into Europe’s economic and social fabric. They provide two out of three jobs, bring training opportunities across regions and sectors, including for low-skilled workers, and support society’s welfare, including in remote and rural areas. Every European citizen knows someone who is an entrepreneur or works for one. The daily challenges of European SMEs to comply with rules and access information, markets and finance are thus challenges for the whole of Europe.
SMEs are very diverse in terms of business models, size, age, and entrepreneurs’ profiles, and draw on a diverse talent pool of women and men. They range from liberal professions and microenterprises in the services sector to middle-range industrial companies, from traditional crafts to high-tech start-ups. This strategy recognises their different needs, helping companies not just to grow and scale up, but also to be competitive, resilient, and sustainable. It therefore sets out an ambitious, comprehensive and cross-cutting approach, based on horizontal measures helping all kinds of SMEs as well as actions targeting specific needs.
The strategy puts forward actions based on the following three pillars:
·Capacity-building and support for the transition to sustainability and digitalisation;
·Reducing regulatory burden and improving market access; and
·Improving access to financing.
The objective is to unleash the power of Europe’s SMEs of all kinds to lead the twin transitions. It aims to considerably increase the number of SMEs engaging in sustainable business practices as well as the number of SMEs employing digital technologies. Ultimately, the goal is that Europe becomes the most attractive place to start a small business, make it grow and scale up in the single market.
To bring results, the strategy must be driven jointly by EU-level actions and strong commitment by Member States. The active involvement of the SME community and companies themselves will be key. The Strategy will therefore be underpinned by a robust partnership for delivery between the EU and Member States, including regional and local authorities. Entrepreneurs should also seize the opportunity of EU investment programmes to make their business more digital and sustainable, as well as to grow in the single market and beyond.