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CHAPTER 2. SME EXPORT PROMOTION POLICIES: THE INTERNATIONAL
EXPERIENCE
2.1. The rationale for policy support to SME export
The numerous benefits to SMEs engaged in international business are well documented. As outlined in
Chapter 1, a considerable body of evidence shows that international trading activity stimulates
productivity growth by strengthening competition and innovation and increasing access to new ideas
and technology. International trading activity enables businesses to achieve growth and economies of
scale which domestic markets alone would not provide. Exporters are consistently found to out-
perform non-exporters using a variety of measures of success. Exporting firms have higher value
added, employ more, and are more capital-intensive and productive than non-exporting firms. This
may be related to both “self-selection” by more productive firms, which are more likely to start
exporting than less productive firms, and to “learning-by-exporting”, whereby firms become more
productive as they export.
Nevertheless, across countries at different levels of development, SMEs are under-represented in
international activity relative to their contribution in national and local economies, which suggests of
the barriers facing SMEs seeking to access international markets. Policy makers have increasingly
recognized that barriers to SME internationalisation have the effect of reducing the capacity of their
economies to reap the full benefits from globalization and, especially, the ability of innovative and
high-growth firms to achieve their full potential from international markets. In fact, any barriers to
international trade are likely to impinge disproportionately on export-oriented SMEs, which are often
the most productive, R&D-intensive and growth-orientated and thus, potentially, the strongest
contributors to a dynamic national economy. However, the
Over the last decades, a wide range of policy instruments and institutions aimed at supporting the
international SME have emerged in many countries, although the specific stage of development of a
country determines to some extent what type of growth-orientation can be supported and which firms
are most likely to benefit from facilitative policies. These largely address the typical resource-
constraints of SMEs, but also the rigidity or burden that may be imposed on SMEs by general business
framework conditions and other government policies or regulations. In other terms, policy initiatives
also follow the recognition that “government failures” contribute to make SME internationalisation
more difficult and demand correction.
To promote SMEs’ participation in foreign markets, it is essential for policy makers to identify the
specific barriers that SMEs and entrepreneurs encounter when planning international business and
operating in foreign markets. Following the classification introduced in Chapter 1, the present chapter
distinguishes internal and external barriers to SME export and provide examples of policy approaches
and tools implemented across different countries to address these specific barriers. Based on a recent
survey of policy makers in OECD countries, Table 2.1 maps some key initiatives undertaken in
selected countries to increase SMEs’ participation to international trade. These measures address
different areas and adopt diverse approaches, whose features are commented in the following
paragraphs.