Measuring progress in regional support for enterprises

In the 2014-2020 programming period, the European Regional Development Fund (ERDF) is providing around EUR 69 billion of EU budget support to boost innovation and productivity in Europe's enterprises. This makes the ERDF the largest source of EU funds supporting enterprises of all sizes. 

Nearly 1.1 million enterprises – around 4% of all companies in Europe – are targeted by the range of financial and non-financial supports available.  With an overall EU cohesion policy budget of 0.3% of EU GDP this demonstrates the focus of ERDF support on productive investments in order to reduce economic disparities. Small and Medium Sized enterprises (SMEs) are the predominant focus of support to enterprises.

1. Why is support given to SMEs? 

ERDF support to enterprises is concentrated on the four key ‘thematic objectives’ (TOs) with the following objectives:
  1. To increase the competitiveness of SMEs;
  2. To boost innovation in companies;
  3. To improve the use of ICT; and
  4. To support the shift towards a low-carbon economy.
Public support is given, respecting  state-aid rules, for multiple objectives such as growing new enterprises, launching new innovative products and services, promoting e-commerce, ensuring energy efficiency and more. 
More detail on the volume of financing and the actions financed are set out in this complementary datastory.  
Chart 1 provides the targets for the total number of enterprises expected to be supported by the national, regional and cross-border cooperation programmes across Europe. Use the filter to explore national contributions to the EU target. 

2. Different forms of support are offered to enterprises 

The analysis of the targets set by the ERDF programmes for 2014- 2020 show that "Thematic Objective 3:  Competitiveness of SMEs" targets the bulk of all enterprises with around 800 000 enterprises targeted for support.
Using the different indicators, we can see that the major forms of support are financial instruments (non-grant aid), grants and business advice (consultancy). Support through consultancy and advice to business will reach the largest number of businesses.

3. How are SMEs supported across the Member States? 

The Open Data Platform shows both the amount of funds allocated to the Member States and the number of enterprises supported in total. The table below shows how the different EU member states contribute to the EU targets and how they are progressing in deciding on selected projects and implementing the supports. 

4. Why are there differences in the number of enterprises supported across the Member States? 

The dominance of certain Member States (UK, FR, ES) in terms of the number of enterprises supported can be explained by several factors: 
  1. The scale of the national economies and the presence of strong entrepreneurial cultures; 
  2. A policy focus on small firms and new firms; 
  3. The scale of the overall volume of support. 

5. How are the programmes delivering and what are the main factors influencing progress? 

At the end of 2018, more than 900 000 enterprises were targeted by the decided (selected) projects; almost 420 000 firms had already benefited from the selected projects. 
The question remains open as to whether the targets will be met or exceeded over the period. Planning public support to enterprises over a 10-year period is a challenge. Demand from business for public support varies with the economic cycle. Some programmes are experiencing in high demand for the supports on offer and are considering raising their targets. 
The regular reporting, shared on the Open Data Platform, will focus minds on keeping the targets realistic.

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We are REGIO's research, business & digital team. Contact us at:
European Commission, Directorate-General for Regional and Urban Policy, Smart and Sustainable Growth