Pros and cons for Veneto SMEs

As everybody knows, EU is the worldwide largest economic area, it is a community within which there is free circulation of people, goods, services and financial capitals and natural people and legal persons are jointed by a communitarian feeling (aquis comunitario), which expresses itself through an overall of shared rules. Its enlargement represents an opportunity to integrate the continental geography by peaceful means, guaranteeing and widening stability and prosperity. The market enlargement will bring an acceleration of economic development; it will create new jobs and social safety, it will protect environment, in other words, it will dramatically improve life’s quality for all European citizens. This implies that the necessity of new reforms, since candidate Countries (in 2007 are Romania and Bulgaria, Croatia and Turkey) have an historical, political, social and economic background which is quite different from the Communitarian one.

Considering the complexity of the enlargement process, it is advisable to remember advantage and opportunities enjoyed by EU Countries. With this aim, the recent Project INFO25, has been created. It meant to help citizens and SMEs in understanding the extend of the enlargement impact on their activities and what kind of new opportunities were opening and will open in front of them (the overall of pros and cons perceived by SMEs during the EU enlargement process is is showed in chart 1). The INFO25Project has been carried out by Veneto Eurosportello and Veneto Unioncamere. It focuses on SMEs, which represent the 95% of European enterprises, and they provide employment to over 74 millions of people. Therefore, SMEs are the most important European instrument for employment and innovation.

Generally, the EU enlargement leads to a stabilisation of the economic and politic system, to the consolidation of share democratic and market values, such as freedom, democracy, human rights protection, all supported by a strong cooperation and promotion will, which goes beyond one’s own borders’ Country.

Positively, a first great advantage resulting from the European membership has been the beginning of the long way towards the administrative simplification process (1). The second advantage comes from the subsidiary principle enforcement, understood as both upright and across deeds (2). The third one is due to the fact that, through the consolidation of a single market, goods and services assessment systems have been standardised and infrastructures have been strengthened, increasing funding opportunities, especially in SMEs favour, which, as already said, are the European economic backbone. The fourth is because of the creation of a labour market always more qualified, for citizens, workers, environment and food rights protection. The increased size of the market dimension affected the industrial reorganisation based on transnational production networks, which gave room to new revenues for all members. The greater advantages have been for enterprises based in regions that, according to geographical position and tradition, were already making business with the boundaries Countries. Italian Northeast, specially Veneto, represents an example of a Region which, exploiting its own geographical position, its production system peculiarity, and the advantage of a single European market, within three years time realised an economic growth without precedents, so that it has been nicknamed the Italy’s economic “locomotive”. The Veneto social-economic structure, characterised by a high density of SMEs included in a tight industrial district network and with a strong export vocation, it has been well integrated in the Communitarian scenario and took from this all the possible advantages.

Currently Veneto exports amount almost to €40 billions (3), contribute towards the Italian goods flow sold abroad for 13%; imports, on the other side, are over €32 billions, equal to 10.5% of the overall Italian rate. Veneto, if compared with the other Italian regions, shows a international vocation far more marked than the rest of the Country, especially this is considered in relation to exportation amount, which has been second only to Lombardy for over 10 years. Within the European scenario, moreover, Veneto has an exportation capacity just little bit lower than Hungary (€49 billions per year), above Portugal (€29 billions per year) and three times the Greece one (€12 billions). Favoured by the geographical proximity, by the similar operational modality and by the belonging to the single European market, Veneto made of EU its main marketplace for what concern export and import. For Veneto, the European Community represents the main business partner and, inside this, Germany is the first supplier Country (23%) and it is in Germany that Veneto sells the higher rates of its regional exportations (13%). Moreover, the start up of the single market and furthers EU enlargements allowed Veneto to penetrate easily the East Europe and Mediterranean markets, which are Countries especially used to the delocalised production of some “mature” sectors such as the textile and clothes ones. In such a scenario Veneto international strategy, is to bring in these Countries (especially Romania and Hungary in Europe but also in China) row materials to be worked there, and afterwards, re-imported to for the mounting and quality control phases. Beyond these advantages, the EU enlargement towards Centre, East Europe represent for Veneto even a new potential market for its export activity, since with the rise of the income per head in EU Countries, is growing also the supply demand in such Countries.

Concluding, the creation and the progressive EU enlargement, are doubtless bringing several advantages to Enterprises in the Member Countries, particularly to Veneto SMEs, known for their vivacity and their international vocation. This involves, however, a higher competition at the international and domestic level, nonetheless an increase in complexity of rules for new regulations set out by the very same single market.

(1) Law no. 241, 7 August 1990: “New regulation in the administrative procedures and right to access administrative documentation”.

(2) The upright subsidiary principle is when the hierarchically lower body fulfil all tasks it is able to perform, leaving to the upper body the opportunity to intervene when the resources available to the lower body do not allow to fully and effectively meet an interest or the execution of a service. The across subsidiary principle is when public bodies own activities are fulfilled by and private organisation external to P.A. but still under its mandate.

(3) 2005 Data. Source: Veneto Unioncamere, Info25, 2006.

Daniela Bruniera
"L'Economia della Marca Trevigiana", n.4 - 2006