Background

The Province of Naples, Lead Partner, will capitalise on its initiatives carried out in the 2000-2006 Campania Region Operational Programme, PLAIT (Public Local Agency for International Trade) which experimented marketing models and cluster approaches for SMEs in high value sectors such as food, fashion and crafts with potential for internationalisation. The transfer of this approach and the exchange of experience with partners with similar SME economies to design new models for trade and enterprise lies at the basis of this proposal. The common needs and constraints of MED SMEs have provided the driving force for the partnership in drawing up the project. The partners have all expressed interest in finding common solutions and models for a experimental cluster approach to internationalisation which can strengthen their SME economy and provide for innovative processes of public-private cooperation. All partners also identified the networks they will use to disseminate the impact and results of the project and the mainstreaming possibilities at regional level:

• OP Campania 2007-13 Priority Axis 2.3 Productive systems and clusters; 2.6 Internationalization
• OP Valencia 2007-13 Priority 1 Development of the knowledge-based economy, R&D&i and the information society; Priority 2 Business development and innovation
• OP Crete & Aegean Islands 2007-2013 Priority Axis 6: Digital Convergence and Entrepreneurship in the South Aegean

MED SMEs are increasingly threatened with a loss of markets because of intense competition, a lack of innovation capacity and a stagnation in traditional industrial activities. Furthermore the fragmented nature of many businesses, difficulties in reaching international markets and limited access to credit effectively blocks their opportunities for internationalisation, benefiting from the opportunities offered by the internal market and exploring export potential outside the EU.

In Campania, the potential of traditional sectors such as agro-industry, is blocked by the fragmentation of the firms, a limited impulse for partnership and cooperation and an ageing entrepreneurial class, limiting competitiveness. Traditional industrial sectors are exposed to intense competition for both domestic and international markets from emerging economies. Even if entrepreneurship is improving, the small size of firms inevitably limits their capacity to innovate or adapt to the market in a competitive context. Industrial clusters are still weak and if they are to develop in a sustained fashion need support, guidance and capacity-building (ISTAT, OP Campania 2007-13, IRI).

In Crete and the Aegean, traditional SMEs face increased competition costs due to geographical limits which can also become an opportunity through innovative clusters for internationalization, as they provide a gateway to the larger Med basin and East. The limits of local markets necessitate extroversion strategies for SME survival and island economies must seek balanced development strategies to avoid seasonally-based single-sector concentration. Traditional industrial and agri-industrial SMEs are excessively fragmented and entrepreneurial skills need fostering. Opportunities for exploiting innovative sectors based on the wealth of biodiversity must be exploited.

In Alicante, the traditional industrial sectors need a new impulse to become more innovative. The Competitiveness Plan for Traditional Sectors and Clusters Development (2006), Regional Network of Technological Institutes and strategic partnerships between the Chamber of Commerce, University and County (2007) have identified the need to foster innovation and promote new tools for the competitiveness of all these traditional sectors through clustering.

In Valencia (Ribera), the last 10 years have seen a significant drift from agriculture to the industrial sector. The need for support, innovation and modernisation of local SMEs has been addressed through programmes for technology and R&D, business development, design, quality and environment, organization and management, training and technologic cooperation since 2002. SMEs would now be mature to benefit from clustering for internationalisation.