SMEs Making News and Being Recognized as Drivers of National and Global Economic Growth
Small Business Knowledge Summit – Recognizing the Important Role of SMEs
According to the Permanent Mission of Argentina to the United Nations, SMEs, including micro-enterprises, make up 95% of the world’s enterprises and account for 60% of global private sector employment. Recognizing the important role SMEs play in global development, the first ever Small Business Knowledge Summit was held last week at UN Headquarters in New York City. The Summit’s goal was to help the, “the international community strategize on how to remove roadblocks, boost innovation, and improve financing and the regulatory environment for entrepreneurs,” in order to foster the 2030 Agenda.
The First Annual International Day for SMEs
June 27th, 2017 will mark the first International Day for Small, Medium-sized Enterprises (SMEs). This designation has been given by the United Nations General Assembly last month, in its recognition that SMEs play an important role in the new global development goals, specifically, the 2030 Agenda.
Globalizing or Internationalizing SMEs as a means of Increasing Domestic Growth Productivity and Achieving Individual Business Objectives
Why should SMEs internationalize or globalize? Isn’t domestic success enough?
On the other side of the Atlantic in the UK, with the uncertain future in the post-Brexit period coupled with weakened growth productivity of the UK economy compared to the rest of the G8 economies, Goldman Sachs, the Enterprise Research Council, and the British Business Bank recently published a report entitled, “Unlocking UK Productivity.”
Although the report speaks specifically to UK SMEs, some of the findings and recommendations are spoken of generally and can be applied globally. Globalization or internationalization is defined as the following activities “international acquisitions, establishing overseas offices, subsidiaries, joint ventures, sourcing products and supplies from overseas as well as exporting.”
According to the report, entrepreneurs who internationalize or globalize their SMEs drive growth productivity in four ways by:
- Creating stronger competition in non-domestic markets
- Increasing exposure to foreign knowledge and technology
- Extending geographical markets; and
- Creating greater diversity in the customer base
Each of these factors has a direct effect on the SMEs itself by increasing its own growth and a contributory effect of increasing the productive growth of the domestic market. Globalized or internationalized SMEs provide a win-win situation by both positively impacting the domestic economy, while providing said entrepreneurs with the means of achieving their business goals that would otherwise not be possible if left to doing business in their domestic market alone.
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