Abcon may be a small business in a small country but trade agreements, according to director Barry Smith, give them international reach. The company located in rural Ireland has been manufacturing specialist abrasive products for difficult access areas or to achieve particular finishes on metal surfaces since 2005. Their products are used in precision engineering, the aerospace industry, and the automotive sector, among others. Thanks to the trade agreements, they now have customers in South Korea, Chile, Singapore, and Canada, to name but a few.
Supplying niche expertise to the wide world
Mass production is difficult for a country like Ireland which cannot compete with industrial powerhouses like Germany. As Smith puts it, "bigger countries can achieve scale, due to their large domestic market".
However, he believes that small countries can compete effectively in specialist products and that’s exactly what Abcon does: “we produce a niche product that can be packaged and shipped at a price point the market can accept, alongside excellent service and technical support.”
When Abcon started trading, they had nine employees. Today, they have 140 full-time staff making the company a major employer in the region. In addition to those they directly employ, they work with local suppliers and subcontractors for various services. In this way, trade agreements have positive effects on EU companies that may not even be export oriented.
Two main challenges faced by SMEs to access international markets are the costs of entering new markets and the access to information. The cost of entering a new market weighs more heavily on SMEs than on larger firms. Establishment, conformity assessment, authorisation of products, recognition of professional qualifications, and other requirements may have the same nominal costs but they have a greater impact on SMEs who have fewer resources for internationalisation. The same asymmetries apply to access to information about market access opportunities (such as laws and regulations in foreign markets, different national technical standards, or difficult paperwork). Large companies may be able to afford legal and economic advice on regulatory requirements, but this is more difficult for SMEs.
Access2Markets breaks the complex rules and conditions down into practical information
The European Commission has taken a major step towards improving access to information on trade agreements with the launch in October 2020 of its Access2Markets online portal. One year on the portal has reached 1.8 million unique visitors highlighting the success of the portal and its usefulness for SMEs. The fact that many parts are multilingual is particularly helpful for SMEs.
“The European Union has over 45 trade agreements with over 70 countries and regions. Access2Markets breaks the complex rules and conditions down into practical information, granting smaller firms easier access to the trade agreements and their benefits. EU exporters of goods and services can find out about preferential terms they may be entitled to and how to unleash them,” says Denis Redonnet, the European Commission’s chief trade enforcement officer.
Access2markets allows companies to look up specific details on imported and exported goods, including on tariffs, taxes, rules of origin, product requirements, customs procedures, trade barriers and trade flow statistics.
The portal hosts information on rules of origin for all EU partner countries and has a function to compare the rules across various agreements and products. The integrated Rules of Origin Self-Assessment tool (ROSA) allows companies to assess whether their product complies with the respective rules of origin and guides them on how to apply the rules specific to their product and export destination so that their product can possibly benefit from the preferential tariff rate. The tool includes clear explanations and examples of how to qualify for origin and how to use for instance cumulation. To make life easier for companies, ROSA contains clear instructions on the documentation required as proof of origin to obtain tariff preferences. The Commission registers around 500 daily assessments in ROSA.
Access2Markets has detailed information for companies about all EU trade agreements. One example is the EU-Canada Comprehensive and Economic Trade Agreement.
Trade deals are about more than slashed duties. For example, the name of some European regions is synonymous with particular specialist foods and beverages. The EU grants Protected Geographical Indication (PGI) status to ensure that only cheese from Gorgonzola in Italy, or sparkling wine from Champagne in France can use their region’s name in branding and marketing. The same is true for Topoloveni Magiun, a plum jam from Romania’s Topoloveni region. For Sonimpex, the manufacturer, this added protection makes trade agreements a deciding factor when considering new markets. That is because EU trade deals include PGIs which offer a legal safeguard against unfair competition.
The success of Access2Markets
Access2Markets has up to 10,000 daily users. The statistics speak for themselves but the portal’s success was also underlined earlier this year when, in a major vote of confidence, Access2Markets won the public vote for the EU Ombudsman’s award for good administration.
The Access2Markets platform provides a wealth of information for companies exploring new markets
The user satisfaction also transpired from a survey among businesses and organisations across the EU who were asked for their practical experiences using the Access2Markets portal and how they have benefitted. The resulting testimonials were overwhelmingly positive and touched on its ease of use and up-to-date information.
“The Access2Markets platform provides a wealth of information for companies exploring new markets and we are delighted to have this available to our EEN clients in Ireland,” says Eileen Kelly, EEN coordinator.
Access2Markets helps European SMEs export and import the simple way, providing businesses with the tools necessary to navigate a digitalised world – empowering them to trade internationally. Thanks to EU’s trade agreements, EU SMEs can increasingly carry out important parts of the export and import process online, saving a lot of time on paperwork and reducing courier costs significantly. Previously companies needed to send hard-copy documents separately via costly international couriers. Now it takes just a few clicks of a mouse.