Press Releases, 11/9/2016
Survey on internationalisation and barriers to trade in 2016: Enterprises believe in internationalisation
Press release 212/2016
8 November 2016
Three out of four Finnish enterprises believe that the importance of international business will increase in 2016–2018. In addition, international business is becoming more diverse. Various service-sector enterprises launching foreign trade have arisen alongside established industrial exporters. The opening of markets, digitalisation and economic turbulence have lowered the internationalisation threshold for Finnish enterprises.
These data are derived from the Team Finland survey on the internationalisation and trade barriers of Finnish enterprises published today. The survey is based on a questionnaire that encompassed about 600 enterprises.
Sweden, Russia and Germany interest the most
According to the survey, small and medium-sized enterprises strive more actively to expand their business by going abroad. The greatest growth potential is seen in Europe – primarily in Sweden, Russia and Germany. According to the survey, these are the most attractive markets.
Enterprises consider their production and process know-how in particular to be their strengths on international markets. As their development targets, in turn, enterprises consider know-how of industrial and intellectual property rights, the utilisation of international sources of financing, and knowledge of the legislation and requirements of target markets. Room for improvement was also seen with regard to participation in public procurement.
Still the most trade barriers in Russia and China
Enterprises often encounter barriers to trade. Two out of three respondents reported encountering some degree of barriers to trade, and a total of about 900 trade barriers were reported. The most common trade barriers were encountered by growth-stage and large enterprises. The most trade barriers were encountered in Russia and China. The reporting of trade barriers naturally focuses on countries where the respondents have the most experience, and on enterprises that are active exporters.
The most common barriers to trade are various technical barriers, such as problems relating to standards, testing and certification as well as difficulties in customs clearance. The enterprises also reported local content requirements placed on various goods and services more often than previously.
Trade barriers are generally a major drawback especially for small and medium-sized enterprises, particularly in the early stages of internationalisation. These barriers constitute a relatively greater cost burden for smaller actors than for large enterprises.
Team Finland helps to remove trade barriers
The Ministry for Foreign Affairs and the Ministry of Economic Affairs and Employment help enterprises in removing trade barriers. Minister for Foreign Trade and Development Kai Mykkänen, who opened the event, stressed the importance of free trade negotiations also in the dismantling of barriers to trade. Minister Mykkänen pointed out that, for example, the Comprehensive Economic and Trade Agreement (CETA) negotiated with Canada opens, among others, extensive public procurement markets in Canada to Finnish enterprises.
The minister also cited the solution involving Russian customs duties on paper and board reached through the dispute settlement procedure of the World Trade Organization. At the same time, this demonstrates how the activity of a small country such as Finland can lead to a positive trade policy outcome.
Read more Team Finland Survey on Internationalisation and Barriers to Trade in 2016 (in Finnish)