Liikanen calls for ICT boost for SMEs
Further investment in information and communication technologies (ICT) and innovation is the needed to boost the fortunes of SMEs (small and medium sized enterprises), according to Enterprise and Information society Commissioner, Erkki Liikanen. In a speech to the European Parliament's SME Intergroup on the 'State of play of enterprise policy issues' on 18 December, Commissioner Liikanen said that SMEs, which account for 98 per cent of all EU enterprises, are 'the major source of employment, innovation and wealth in the European Union.' Outlining the Commissions' achievements in improving the legal and financial environment for SMEs in 2000 to 2001, Mr Liikanen said that the Charter for small enterprises, adopted in June 2000, sets out clear targets for Member States and the Commission to help SMEs thrive. At the beginning of 2002, the Commission will present a report on the implementation of the Charter to the Council and the European Parliament. Mr Liikanen outlined data from the recently published Competitiveness report, which underlines the role of ICT and innovation in boosting Europe's economic progress. The report said that although ICT investment can make a substantial contribution to economic growth, companies need to change their organisation and working methods in order to fully benefit from it. Mr Liikanen pointed to recent studies comparing US and EU ICT performance, showing that in the second half of the 1990s, the EU may have lost up to 0.5 per cent of annual economic growth due to weaker investment in ICT and slower diffusion of the technologies within Member States. The Commissioner said that the Commission is addressing these challenges through actions such as the eEurope action plan, and specific measures for SMEs. He highlighted the GoDigital initiative to help SMEs get online and moves to benchmark national ICT policies in the EU. Mr Liikanen also said that the financial needs of SMEs who want to invest in ICT are being addressed by the multiannual programme for enterprises and entrepreneurship. Mr Liikanen praised moves to help businesses by cutting back red tape and improving the regulatory environment. Again, this is an activity which is of particular interest for SMEs,' he said. 'While big firms can mainly deal with complicated legislation, small firms are highly dependent on regulatory approaches which are easy and transparent. In addition to simplification of the regulatory environment, the Commissioner said, recent surveys indicate that the image of entrepreneurs and the risks involved in setting up a business is improving. A growing number of Europeans now acknowledge that becoming an entrepreneur can be an attractive alternative, that risk-taking should be rewarded and that those who have tried and failed should be given a second chance. Mr Liikanen announced a number of measures to improve transparency and consultation with stakeholders, including Internet consultations, regular meetings with business organisations and the creation of an Enterprise Policy group, representing a range of different sectors and professions, to give their view on enterprise policy and aid communication. In addition, Mr Liikanen announced the appointment of Timo Summa, a Director in the Commission's Enterprise DG, as an 'SME envoy' to listen to SMEs and represent their interests within the Commission with the backing of the Enterprise DG. Mr Liikanen also addressed the Basel II accords, which aim to revise the methods used for assessing the capital adequacy of enterprises. He said that the Basel II process is important for SMEs as so many of them rely heavily on loan finance. He said that the Commission has proposed a project within the multiannual programme for Enterprises and Entrepreneurship which will help to understand the effect of the changes on SMEs. In a separate development, the Commission welcomed on 19 November the announcement by the Basel committee of a revised process for finalising the new Basel II Capital Accord. The new process will incorporate an additional review of the impact of the accord before publication of a third consultative document. Internal market Commissioner Frits Bolkestein welcomed the move, saying it 'should enhance the quality of the final package and help make the consultation period an even more productive one.' The accord is expected to be finalised in 2002. Advances have been made towards the completion of a new risk-sensitive international framework, including options for the calculation of minimum capital requirements. These include development aiming to ensure that levels of regulatory capital remain, on average, the same as under the current accord.