SME participation in FP5 proving productive -report
A new analysis of SME (small and medium sized enterprises) participation in the first year of the current Fifth Framework programme (FP5) has demonstrated the effectiveness of the programme in helping SMEs develop or gain access to new technologies and in entering new markets at home and abroad. It also shows the continuation of trends which began with the introduction of two measures specifically geared towards SMEs under the Fourth Framework programme (FP4). The first was the establishment of exploratory awards to provide companies with financial support for the preparation of project proposals. The second was the co-operative research projects (CRAFT) awards offered to groups of companies with little or no in-house research capacity to enable them to commission research and development work by a university department or an outside research organisation. These measures were extended under FP5 with immediate results, the report shows. In its first year, the programme provided more than 450 million euro in funding to more than 4000 SMEs participating in the thematic programmes (ie, Quality of life, Information society, Growth, Energy environment and sustainable development) between April 1999 and 2000, compared with a total of 1427 million euro over the full four years of FP4 (1994-98). Despite a more restrictive definition of what constitutes an SME, the percentage of SMEs among the industrially funded partners showed no decline between FP4 and FP5 while the overall participation actually increased from 28 to 37 per cent. The analysis reveals other trends that demonstrate the value of the Commission's collaborative research programme to SMEs. The number of exploratory awards received during the first year of FP5 (674) is more than half of the total for the whole of FP4. Meanwhile, the Framework Programme has shown increasing success in attracting participants from the Cohesion countries of Ireland, Greece, Portugal and Spain and in involving companies from the associate member countries of the EU. However, echoing the sentiments of the Commission's recent communication on innovation, the report also emphasises that SMEs face a difficult and ever changing business environment. Challenges such as the increasing competition resulting from the completion of the internal market and the growing demands of larger companies for which they often work as sub-contractors mean that small companies must innovate to survive.