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Enhancing SME Financing in Europe with JEREMIE Program

Explore the progress and future perspectives of JEREMIE, a financial initiative for SMEs in the EU regions. Learn about the challenges, solutions, and implementation phases of this program.

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Enhancing SME Financing in Europe with JEREMIE Program

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  1. JEREMIE Progress of the JEREMIE implementation and perspectives for SMEs - Overview - Dorota Kalina Zaliwska Directorate GeneralforRegional Policy Unit D3 ‘Financial Engineering’ JEREMIE workshop, 2nd June 2008, Brussels

  2. 250 or more employees * 23.2 mln enterprises in EU25 9 * 99% of all European enterprises are SMEs 50-249 employees 25 10-49 employees * SMEs represent 75 mln jobs 169 Less than 10 21,000 Informal sector Source: Communication from the Commission dated 10/11/2006 on SME policy. Breakdown according to Eurostat 2006 (data 2003). THE ENTERPRISE PYRAMIDE IN THE EU Source: EUROSTATNumber of enterprises in Europe (EU 25) [in thousands]

  3. KEY FACTORS OF BUSINESS SUCCESSSource: EUROSTAT survey, 29/2006 Previous experience of a new entrepreneur helps but is not essential “Administrative problems” and “relations with customers” are considered as the main start-up problems Age and education play a role in launching a new business

  4. SME ACCESS TO FINANCE IN THE EUFlash Eurobarometer • SMEs basically use banks for their financing (8 SMEs out of 10) • Venture capital is envisaged only by about 14% of EU SMEs • 50% of SMEs seem to make use of leasing, renting, overdrafts • 70% of SMEs surveyed believe that banks do not want to take risks

  5. EU SMEs - MAIN BUSINESS CONSTRAINTSObservatory of European SMEs (April 2007) Purchasingpower of customers (46%) Administrative regulations (36%) Lack (35%)andcosts (33%) of human resources Infrastructureproblems (23%) Limited access tofinance(21%) smaller enterprises ~> more likely tohave funding difficulties

  6. LIMITED ACCESS TO FINANCEObservatory of European SMEs (April 2007)

  7. EU SMEs -BARRIERS TO INNOVATION Observatory of European SMEs (April 2007) • .

  8. JEREMIE • JEREMIE stands for:‘Joint European Resources for Micro to Medium Enterprises’ • JEREMIE is a joint initiative of the Commission and the EIF/EIB • Its objective is to address market failures regarding access to finance for SMEs and to support new business creation in the regions of the EU

  9. LEGAL FRAMEWORK General regulation for the Structural Funds, 1083/2006, Art. 44, Art. 78(6) and 78(7) Commission regulation for the SFs, 1828/2006,Articles 43 – 46 EU legislation on: - Public procurement - State Aid Applicable national legislation

  10. JEREMIE PHASES (1) Phase 1 : Preparation • Evaluations (2006-2007-2008) • Programming Phase 2: Set-up • MAs select Holding Fund • MAs contribute to Holding Fund • HF selects financial intermediaries • HF supports /takes participations in financial intermediaries

  11. JEREMIE PHASES (2) Phase 3: Implementation • Financial intermediaries support: - SMEs - micro-credit beneficiaries • Closing OPs in 2015, or earlier • Recycling OP resources

  12. JEREMIE FLOW CHART Operational Programme FINANCIAL INTERMEDIARIES HOLDING FUND SMEs

  13. JEREMIE EVALUATIONS • Co - financed by: - Commission (75-85%) • EIF (25%-15%) • National reports: GR, RO, BG, LV, EE, LT, SI, DN, SK, CZ, MT, CY, HU, PT • Regional reports: UK, FR, ES, IT, DE • Overall 47 reports by the end of 2007, some more in 2008 for PL, DE, etc.

  14. JEREMIE IN OPERATION (1) • Some 85 OPs includean option to have JEREMIE or a JEREMIE type action • EIF: THE KEY ACTOR FOR JEREMIE • Greece first to sign a holding fund agreement with EIF in June 2007, Romania signed early 2008 • Other MSs (Bulgaria, Slovakia, Latvia, Lithuania) expected to sign funding agreements with EIF soon

  15. JEREMIE IN OPERATION (2) • Regions in Poland, France, the UK, Spain, Italy, Germany, expected to sign funding agreements with EIF • Hungary is already implementing and Finland envisages to implement JEREMIE type actions • About 20 MSs expected to implement or to be inspired by JEREMIE

  16. JEREMIE IN OPERATION (3) • Very good perspectives • Hard work required • REGIO – EIF – MSs are the key players • EIF expected to assume the challenge in about 15 MSs • EU financial and banking sector and SMEs respond positively

  17. Good luck JEREMIE! For further information: E-mail: REGIO-FINANCIAL-ENGINEERING@ec.europa.eu Website: http://jeremie.europa.eu

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