The European Parliament has called for measures to help small and medium enterprises deal with the crisis and the twin challenges of digitalisation and decarbonisation.

The appeal was made in a report which highlights the need to update the European Commission’s SME strategy in the light of the COVID crisis while keeping the focus on advancing the transition toward a socially, economically and environmentally resilient society and a competitive economy. MEPs called for aligning the SME Strategy with the Industrial Strategy, the European Data Strategy and the European Green Deal, to actively involve and support all SMEs in the twin transition.

As SMEs miss the necessary resources to face complex bureaucratic requirements, the excess of administrative and regulatory burden is hindering their ability to thrive, said MEPs, who welcomed the European Commission’s commitment for a “one in-one out” principle and call for setting up a roadmap with concrete and binding targets for better regulation and simplification.

Ensure liquidity and funding for SMEs

MEPs stressed the immediate need to restore the liquidity of SMEs to ensure their basic functioning, and warned that their post-COVID-19 survival, in particular of micro-enterprises given their structural weaknesses, would depend on swift decision-making, adequate funding and availability of liquidity. MEPs expressed concern regarding the difficulties in accessing EIB funding lines faced by most SMEs, partly because of lacking awareness, but also slowness and excessive complexity of the procedures and eligibility criteria. Investments in innovation should prioritize ecosystems that are inclusive of SMEs, they added.

MEPs were deeply concerned that sectors such as tourism, hospitality, cultural, creative, transport, trade fairs and events sectors, which are largely composed of SMEs, have been hit the hardest by the COVID-19 crisis. They advocated a temporary relaxation of EU State aid rules, considering the specificities and the geographical disadvantage affecting those SMEs located in the most peripheral territories.

COVID-19 push towards e-commerce and digitalization

The COVID-19 crisis pushed SMEs towards innovative technologies, new ways of organising their work and digital business models such as e-commerce, the sharing economy and remote working, said MEPs. Member states should develop pilot initiatives to accelerate SMEs’ take up of e-commerce solutions, they added.

Background

The Commission’s communication “An SME strategy for a sustainable and digital Europe” was published on 10 March 2020, a day before the World Health Organisation Issued the COVID-19 pandemic alert. Since then, the economic crisis made a revision of the strategy necessary, MEPs said.

There are 24 million SMEs in the EU-27. They represent the backbone of the economy and generated more than half the EU’s GDP while employing about 100 million workers before the beginning of the pandemic.