Export promotion

SMEs must adopt international standards of product quality, innovation, customer service, and reliability in view of the competition that exists in the export markets. Exporting creates opportunities for learning.

The domestic markets of the developing countries and of the economies in transition are as a rule too small to allow for strong and lasting economic growth. Globalisation broadens markets, as well, and SMEs must seek wider markets in order to make the most of the advantage of dealing in large volumes, by designing strategies for specialisation. These strategies can be carried out only if entrepreneurs form networks (as suppliers or subcontractors) and export.

SMEs in developing countries (with the exception of some Southeast Asian nations) usually compete with the mass-market production of large domestic companies -but without achieving their levels of production and standards of quality. With lower profits, their workers earn less pay than those employed by large enterprises.

Exporting, aside from offering larger markets, creates the opportunity for technological and organisational learning. The leading enterprises are present in the export markets; competitors will be evaluated on the bases of standards similar to those offered by the leaders as to product quality, innovativeness, customer service, reliability, and so forth. Exporting gives enterprises an opportunity to restart learning processes that fell by the wayside during the import substitution period.

An array of instruments are used to promote exports. International development organisations can participate in their implementation, application, and perfecting, as follows:

• Promote in particular enterprises that have an export potential, but little or no experience

• Offer business service packages (business plans, export strategy, and market studies)

• Contribute to entrepreneurial co-operation and integration into networks

• Further subcontracting and collaboration with international trading companies

• Facilitate access to international commercial information, which should be timely, up-to-date, relevant, and specific

• Conduct studies of the target market

• Boost the supply of entrepreneurial services (technical assistance and training)

• Encourage participation in commercial fairs and missions

• Offer training to SME export managers and build up their export departments

• Implement electronic commerce solutions (B2B, above all) designed especially for small and medium-sized export companies, more...

• Training of quality assurance and management systems like ISO 9000, ISO 14000 and HACCP, more...

• Implement quality assurance systems like ISO 9000 and HACCP

• Organise "Technological Missions" in OECD countries, more...

Assistance should be given only to those enterprises (associations, trade groups, or chambers) that have an evaluated export potential. Such companies should contribute a fair share of the financing cost of the measures, ranging as a rule from 30% to 60% of the total costs.

My experience in this field includes the above mentioned instruments. I have been working for 5 ½ years as European Codirector in a SME and export promotion project funded by the European Commission.