Reform procurement to 'kick start engine of growth' in Europe

16 October 2013

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17 October 2013 | Paul Snell

European governments should allocate a certain percentage of public contracts to smaller businesses if they want to drive growth, according to a group of technology entrepreneurs.

The Startup Europe Leaders Club, which includes the founders of the music streaming service Spotify and the chairman of Rovio Entertainment - the developer of the hit video game Angry Birds, has published a manifesto for entrepreneurship and innovation to support growth in the EU.

Among the recommendations put forward is a call for governments to commit to giving SMEs a certain amount of public contracts.

“Government subsidies are one way to help SMEs flourish. The other is ensuring the government itself procures more from these companies. Across the EU, the vast majority of government procurement contracts are filled by large, often multinational businesses,” the manifesto said.

“For many entrepreneurs, selling to the government is all but impossible - navigating the procurement process is complex and existing suppliers have become so entrenched that unseating them discourages many entrepreneurs from even trying.

“If EU governments want to kick start the engines of growth in their countries, they must commit to shifting a certain percentage of their procurement contracts to smaller firms.

The manifesto contains 22 actions in total, among which include encouraging university students to start a business before they graduate, implement a ‘pan-European start up visa’ which would make it easier for start up companies to hire non-EU talent, and for each EU country to hire a Chief Digital Officer to promote digital innovation.

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