Arnaldo Abruzzini, Secretary General of EUROCHAMBRES

Thanks to its members, EUROCHAMBRES can voice the concerns of over 19 million enterprises, most of which are small and medium ones, on all major economic issues. In addition, we deliver specific services to the business community, and enable them to participate in several EU-funded programmes. It is no coincidence that EUROCHAMBRES’ motto is ‘Connecting business to Europe’!

How does EUROCHAMBRES promote entrepreneurship and investment in Europe?
Creating the right framework for enterprise and promoting a more entrepreneurial climate in Europe are the key objectives for the Chamber network and EUROCHAMBRES.

The following are some examples of how Chambers promote entrepreneurship through their daily activities:

Business creation: Chambers assist more than 700,000 companies per year in their start-up phase. For example: Belgian Chambers are part of an official national network of one-stop-shops, while French Chambers manage an online support for start-up formalities called CFEnet.

Development of enterprises is one of the widest areas of work for Chambers since it crosses over many functions from providing access to finance, offering support networks, to lobbying for better regulation, etc. All Chambers are generally involved in business incubators, helping companies in their first years of existence and thereafter with support networks such as the Enterprise Europe Network to promote business cooperation.

Transfer of companies: in this field, EUROCHAMBRES coordinates the programme ‘Mentoring Business Transfer’ which aims to provide mentoring to 1,000 entrepreneurs who have just taken over (first year) an established company of less than 50 employees in the EU27.

EUROCHAMBRES and its member Chambers also encourage entrepreneurship ‘from the ground’. We believe that young people should be aware of the option to become an entrepreneur. This is why we encourage close cooperation between universities and businesses and push for a systematic inclusion of basic business know-how (e.g. how a company works, etc.) in all university curricula.

What do you think are the main barriers to growth for SMEs in Europe?
According to our Members, the most significant problems faced by European SMEs are: administrative burdens; taxation; access to finance; barriers to trade; employment legislation; skills shortage.

Of the topics mentioned by the respondents, unfair competition of large companies or of countries with low labour costs and issues related to the international financial crisis are relatively new.

With the economic crisis, some of these obstacles are even more acute and require immediate solutions. Today, problems related to the economic supply chain, to the deteriorating business cycle and to specific issues such as access to credit and late payments from clients are exacerbating problems for SMEs, jeopardising not only their investment plans, but also their solvency.

What, in your opinion, can the EU do to encourage SME growth?
It is vital that all 27 EU national governments, European institutions and economic partners (including Chambers of Commerce) actively seek to foster a stronger and more vibrant culture of enterprise in Europe.

The current pace of reforms is too slow. To move up a gear, the EU and the Member states need to put SMEs more at the centre of their action. This requires the immediate implementation of the Small Business Act (SBA), which identifies accompanying action on areas for urgent policy intervention (i.e. access to finance, access to markets and regulatory reform). Member states must also commit to the SBA as a long-term process – this is not just about reacting to a crisis, it is about putting in place the building blocks for European competitiveness, growth and job creation. The Member states that are first to implement the measures proposed in the SBA, will be quicker out of the crisis. They will have a competitive advantage.

On a very concrete level, EUROCHAMBRES participates in the European programme ‘Erasmus for Young Entrepreneurs’. Thanks to this new European exchange programme, new entrepreneurs will be able to spend time (one to six months) working in an enterprise managed by an experienced entrepreneur in another European country. The aim is to create more and stronger businesses in Europe: new entrepreneurs will gain competences and perspectives that will prove invaluable during the business start-up phase, while also enhancing potential cross-border activity and thus, the probability of success.

How do you think the current financial crisis has impacted on business in Europe?
A recent EUROCHAMBRES survey – conducted among entrepreneurs who participated in the European Parliament of Enterprises – shows that businesses in Europe are being hit hard by the crisis. About three-quarters of respondents have registered tighter lending conditions from banks over the last three months, and about 45% will decrease their investment activities over the next six months. This may also have repercussions on employment with 35% of European companies considering cutting the number of employees over the next six months. Overall, entrepreneurs consider that the general macroeconomic uncertainty, the steep decline in domestic demand and increased difficulties in accessing finance will be the main obstacles their business will have to face in the coming months.

European businesses are also concerned about the lengthening delays in payments by clients. Payment times from the public sector have increased for 43% of respondents, and the situation is even worse from private clients, with 60% of companies suffering from longer payment delays. This exacerbates the difficulties created by reduced access to credit.

Do you think national governments and the EU are doing enough to assist businesses, particularly SMEs, through the economic downturn?
We have all witnessed a certain lack of coordination within the EU. Member states looked mainly for solutions directly related to their own domestic problems, while the European Economic Recovery Plan launched by the Commission to set some guidelines for recovery has been a ‘toolbox’ only partly used.

It should also be taken into account that the EU is not legally equipped to do much more than what it did in terms of economic coordination between Member states – this has proven problematic in the current circumstances. Moreover, the fact that the crisis is of a rather ‘new’ kind, poses even more problems in this respect.

We have witnessed a few more encouraging signs recently. I refer to the de Larosière report on financial supervision on the basis of which the Commission will propose guidelines in the month of May. I also refer to the fact that most Member states seem to have tabled or at least announced measures to help businesses with access to credit, which is today the biggest problem – money injections into financial institutions of recent months did not reach businesses and consumers as should have been the case.

How can they improve their support of businesses in these difficult times?
Policymakers at all levels should concentrate their actions on two priorities: as already mentioned, easing access to credit, and also addressing the issue of late payments. They should ensure that injections of public money or public guarantees in European banks are strictly dependent on the commercial banks’ assurance to their government that the money will be used to ensure businesses’ access to credit, as is already the case in some Member states. Moreover, we believe that the creation of an EU guarantee fund for SMEs would greatly help businesses’ ability to lend and invest, thus bearing the potential to re-launch the European economy as a whole.

Policymakers are now concentrating on short-term actions to come out of the crisis, such as stimulating demand – as national recovery plans presented by member states clearly demonstrate. However we must not overlook the main, longer-term objective, namely the overall enhancement of Europe’s competitiveness. We need to continue efforts in the framework of the Better Regulation agenda, invest much more resources in research and development, clean technologies etc., and pursue structural reforms in member states. This crisis proved that pursuing structural reforms pays off: the countries which have been bolder in their reform efforts in recent years have more room for manoeuvre in terms of economic and fiscal actions than those which didn’t carry on substantive reforms.

How does EUROCHAMBRES facilitate companies looking to invest or expand into other European countries?
Our approach is two-fold. EUROCHAMBRES strives for the best possible legal framework to be put in place to facilitate cross-border trade of European companies. We closely monitor the implementation of the Services Directive; we focus on the elimination of tax obstacles to all forms of cross-border economic activity; and we support the creation of a European Private Company Statute to facilitate the establishment of cross-border subsidiaries for SMEs.

On the other hand, we provide networking opportunities between our Members, and between our Members’ members. Our annual Congress is an example. This ultimately benefits companies who can rely on a strongly interlinked Chamber network in all European countries.

Do you think businesses in certain regions of the EU are more vulnerable to the crisis than other areas?
The regions where risk-sensitive sectors are concentrated are more vulnerable to the crisis. These sectors are the automotive, construction and of course, financial areas. As a consequence, France, Germany and Italy (where the car industry plays a big role), Spain (where the construction sector is crucial) and the UK (Europe’s financial hub) are the most exposed.

We have recently heard from our members about increasing difficulties for businesses looking to access credit from banks in Poland and generally in all Central and Eastern European (CEE) countries. Growing difficulties in accessing credit are also coupled with a massive capital outflow from those countries and by monetary instability as a result of the fact that, except for Slovakia, CEE countries are not eurozone members.

What actions do you think the EU can take to improve this situation?
In general terms, we need to act solidarily in Europe, as well as to strongly condemn protectionist tendencies currently arising among EU countries. EUROCHAMBRES welcomed the general willingness to support Central and Eastern European countries, expressed by Head of State and Government during the Extraordinary European Council of 1 March. We just hope that the measures taken on a case-by-case basis will be thoroughly coordinated otherwise they will not help in tackling the crisis, or might even weaken the Internal Market structure.

How important do you think the G20 summit will be in formulating a coordinated approach to assisting troubled businesses?
On the occasion of the November 2008 G20 summit in Washington D.C., leaders agreed to strengthening the transparency and accountability of financial markets, enhancing regulation globally, reforming global financial institutions through reinforced multilateral cooperation.

The London meeting of 2 April must now deliver on these promises. Chambers of Commerce of the G20 countries expect to see concrete proposals on the table – especially with regard to a fair and balanced reform of global financial institutions and the need for a sounder and more transparent global financial system, including a higher degree of financial and macroeconomic surveillance.

The London summit must represent the starting point of this process of reform, which will require the ongoing commitment of all parties involved. The time of empty declarations and hollow rhetoric is over: financial markets, as well as economic actors, need to regain confidence, quickly.

COMMENTS

document shredding

2009 12 17

I have a very sophisticated website doing a business process and already have 5 large customers using the website after paying. But due to expensive software development cost I have no money to market the product. Suggest me what should I do and give me some ideas.document shredding

Online Tax Preparation

2010 02 24

Why doesn’t the concept of a National Sales Tax--elimination of Income Tax catch on more? A much smaller IRS would be needed--downward pressure on taxes.Less Accountants would be needed--downward pressure on the costs of goods.
Online Tax Preparation

ADD YOUR COMMENT

*Name:

Company name:

*Email:

Comment:

Remember my personal information
Notify me of follow-up comments?

Please enter the word you see in the image below: