Tuesday 12 November 2019

We need a bold strategy to nurture and support Irish SMEs

Our country has made huge strides since the recession. Through resilience, talent, and determination, we overcame enormous challenges. Stock Image
Our country has made huge strides since the recession. Through resilience, talent, and determination, we overcame enormous challenges. Stock Image

Heather Humphreys

Our country has made huge strides since the recession. Through resilience, talent, and determination, we overcame enormous challenges.

There are more people working in Ireland today than ever before and exports by Enterprise Ireland companies increased 6pc last year to €23.8bn.

According to the IMD Business School, we are the 7th most competitive economy in the world and second most competitive in the euro area. Nevertheless, with global challenges facing us there is no room for complacency. Every generation needs to shake up its enterprise and jobs model, otherwise it falls backwards.

Through Future Jobs Ireland, the Government wants to nurture entrepreneurship and support our businesses and workers to prepare now for tomorrow's world.

Currently 70pc of our workers are employed by SMEs, highlighting the crucial importance of indigenous businesses to stability and growth in every region.

That is why I commissioned the OECD to undertake a detailed review of Ireland's SME and entrepreneurship policies in March 2018. Today I am publishing the outcome of the review in what is a pivotal moment in the policy direction of my Department.

The review is about looking to the future from a position of strength and asking: what can we do better?

We have always supported Irish businesses and we have excellent agencies like Enterprise Ireland and the Local Enterprise Offices (LEOs), who help thousands of indigenous small firms to grow.

Our strengths include the whole-of-government approach we take to SME policy and how actively we involve stakeholders in decision making.

We now need to bring all of those supports, policies and programmes together, and drive forward one comprehensive unified framework for Irish businesses.

The OECD's recommendations will form the building blocks of an ambitious new national SME and Entrepreneurship strategy, which I will bring forward by the end of this year.

That strategy will set out key targets and performance indicators:

• Targeting a 50pc increase in the number of SMEs exporting.

• Achieving a step-up in financial skills and knowledge among our SMEs

• Ramping up supports so that Irish businesses can embrace the digital revolution.

• Simplifying the process for accessing the R&D Tax Credit so that more SMEs can benefit.

• Supporting our small firms in the transition to a low-carbon economy.

That is why we will also broaden the remit of the LEOs to ensure that no ambitious Irish company is left behind because they find themselves falling between their Local Enterprise Office and Enterprise Ireland.

Typically, in Ireland, our foreign-owned firms are highly productive while our indigenous SMEs lag behind. The Government wants to close that gap and strike a better balance.

I absolutely value the crucial role that FDI plays in Ireland's economic success and how indigenous companies can leverage that investment. For every ten jobs that are created in FDI firms, there are eight spin-off jobs in other companies here.

For that reason, the question should never be about FDI or indigenous but rather how we can maximise the benefits for both.

There are many great examples of partnerships between domestic companies and foreign multinationals to everybody's benefit. This is something I want to see more of into the future and it is why I have made SME involvement a prerequisite when applying for the Government's €500 million Disruptive Technologies Innovation Fund.

Our indigenous Irish companies are the engine of our economy, and I want to ensure we are doing everything in our power to support them.

In the past, smaller firms have sometimes felt overlooked by governments and I want to change the narrative.

Abraham Lincoln once said that "the most reliable way to predict the future is to create it". Our new SME strategy will be about creating the future we want by ensuring that home-grown firms are given the red carpet treatment they deserve.

Heather Humphreys is Minister for Business, Enterprise and Innovation.

Indo Business

Also in Business