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Closing address of the "Boosting SMEs through Internet" seminar

Jean-Jacques DUMONT
Directeur de l'Action Régionale et de la Petite et Moyenne Industrie
  
Ladies and gentlemen,
 
Allow me to apologise for Mr Christian PIERRET, Minister of State in charge of Industry, who unavoidably had to attend an important interministerial meeting. Mr PIERRET has asked me to close this seminar on his behalf.
 
I consider it a pleasure to address this seminar on policies designed to develop the use of Internet and New Information and Communication Technologies. There are three reasons for this.
 
First, the Minister of State in charge of Industry believes that know-how of these technologies is vitally important for the competitiveness and growth prospects of businesses.
 
Secondly, we believe that France does not have to be ashamed of its initiatives in this area.
 
Lastly and above all, meetings like this provide an exceptional opportunity to compare experience and so to discover ways to improve initiatives designed to help the business community. This is the first time that a meeting on this topic is organised under the auspices of General Directorate 23 of the Commission, and I am pleased that France is its host.
 
I shall not talk about the stakes of the information society, already clearly and abundantly analysed during the presentations.
 
I should first like to present the French action programme which, even if it would be presumptuous of me to call it a "best practice", may nevertheless cast an interesting light.
 
A. The French programme
 
The French Ministry of the Economy, Finance and Industry has launched an ambitious action programme toward the development of New Information and Communication Technologies.
 
1. Initially, the issue was examined in depth by a taskforce headed by Mr Francis LORENTZ, who addressed you yesterday. In late 1997, his work resulted in a series of "10 recommendations for the development of e-commerce". He identified four objectives: creating confidence, having the government set an example, fostering use of the Internet and its commercial applications by SMEs, and building up dialogue on e-commerce between government and businesses.
 
I. Creating confidence
- After consulting operators and experts, the government decided on far-reaching liberalisation of cryptology regulations. Moreover, in order to stimulate the creation of safe tools, the Ministry of Industry offered FRF 40 m worth of R&D subsidies to successful French bidders for cryptographic projects.
 
- In 1998, significant headway was made in promoting standard protected payment systems, including an electronic purse for small payments. The French banking community and GIE Cartes Bancaires, the economic interest grouping on bank cards, worked out a unique protection solution known as Cyber-COMM.
 
- The government continues to support the launch of an electronic purse for small payments as part of European collaboration efforts. The authorities will shortly launch an invitation to bid for an offering compatible with the euro and creating a new European standard.
 
II. Having the government set an example
 
- Government e-commerce initiatives have made large strides forward, including experiments with electronic payment instruments and simplification of administrative measures. In May 1998, 70 administrative forms were put on line. This figure is expected to nudge the one hundred mark in the spring of 1999.
 
- The move toward paperless government procurement is well underway, even if we would have liked faster results, which depend on the particularly complex reform of the Public Procurement Code currently in the pipeline.
 
- The government has further launched a VAT remote declaration and remote settlement project. Moreover, in February 1999, personal income tax returns were entirely put on line. Lastly, the authorities have adopted an effective certification mechanism for labelling quality certificates and certification authorities.
 
III. Fostering the economic and commercial use of Internet
 
- Telecommunications quality and costs are more than ever the key to growth of trade between businesses or between final customers and businesses. It is essential to make rapid progress in this area. The United States has a significant edge in terms of network topology, a buoyant domestic market and relatively low interconnection rates, which raises the risk of a growing gap that would hurt market share and affect the location of commercial servers.
 
IV. Building up a dialogue on e-commerce between the government and the business community
 
- The rise of e-commerce requires recourse to highly sophisticated software and hardware. It is not certain that the available R&D resources, notably at Community level, are up to the challenge or sufficiently focused on key priorities to generate the necessary momentum, especially compared with US budgets and US plans - pushed at the highest political level - to develop a new generation Internet. Focus of efforts on a federative "Internet of the Future" programme would generate strong economic and competitive momentum in Europe.
 
- Development of an e-commerce offering will largely depend on the creativity of new entrepreneurs. In 1998, the authorities adopted a package of tax, financial and other measures, which, while not specifically designed for e-commerce, should be extremely helpful for this sector. But this is probably not enough. The US momentum in this area is not just due to abundant venture and start-up capital. It is maintained and built up by business angels who provide new entrepreneurs with support. Several measures have been suggested to encourage the emergence of this type of assistance in Europe. Lastly, we will also have to adjust our "cultural" environment in order to improve the reward for the risk taking, creative initiatives and "pioneering" spirit essential for success on the Internet.
 
- In March 1998, the French Minister of State in charge of Industry submitted a memorandum on e-commerce at Community level to the Council of Telecommunications Ministers of the European Union. This paper calls for Community rules capable of stimulating e-commerce and proposes positions designed to speed up definition of an EU doctrine.
 
- More broadly speaking, Europe and France have managed to make their views and priorities stick against American initiatives. The Ministry is represented at international forums organised to work out a new Internet framework (notably the OECD conference on e-commerce held in October 1998 in Ottawa) and participates in all French and Community actions aimed at laying down new policy for the attribution of international Internet domain names and addresses.
 
- Lastly, the past year enabled us to overcome the sometimes simplistic opposition between self-regulation and legislation. It is now generally agreed that, while the success of e-commerce depends on responsible market players, suppliers and consumers and to develop self-regulation, a minimum but binding regulatory framework is required to create the legal certainty necessary for electronic transactions and to guarantee the fundamental rights of private citizens.
 
2. Based on this situation, new objectives have been set for 1999, notably:
 
* development of effective recognition methods for digital signatures;
* efforts to improve the coherence of government remote declaration and remote settlement procedures;
* creation of an Internet quality observation network.
 
3) As regards the business community, the authorities have embarked on initiatives to promote and support the use of New Information and Communication Technologies (NICT) by businesses in general and SMIs in particular.
 
a) In conjunction with regional partners such as the Chambers of Commerce and Industry, the services of the Ministry of Industry has launched an NICT awareness campaign whose actions range from individual contact with businesses to briefings and competitions designed to reward and disseminate the most outstanding initiatives (Les Exportateurs sur la Toile, Electrophées).
 
b) All initiatives of the Ministry of Industry in favour of SMIs have been adjusted to factor in NICTs. We notably support the business diagnoses of private business consultants with advice in order to help SMIs find the right NICT solution for their needs.
 
c) Collective projects are encouraged. In 1998, the government launched a call for proposals designed to identify and speed up implementation of collective NICT projects. This call triggered an abundance of extremely interesting initiatives and will therefore be repeated in 1999.
 
d) Lastly, reflections are underway to improve support for the creation of businesses based on NICT.
 
B. Exchanging experience
 
But none of our countries can carry on such actions on its own.
 
This is first of all because the framework in which businesses - even SMIs - move is European and even global. Many measures affecting the business environment in particular are adopted at European level. This is the direction of the initiatives taken by France and its partners.
 
But it is also necessary to exploit the whole body of experience accumulated in and the initiatives taken by the countries of the European Community. From a weakness in the past, Europe's diversity seems to have become a strength.
 
This is why this seminar is important.
 
Granted, time was short, but if I am not mistaken, your efforts have met the expectations of the organisers, viz. to compare experience in order to identify best practices it would be interesting to transpose to other countries and to propose joint solutions.
 
Demand from SMEs for NICTs varies widely from country to country. In some, NICTs have come a long way, in others the penetration rate is lower. It will be interesting to understand which policies were conducted where and to arrange the necessary adjustments to the economic and cultural environment of each country.
 
While it is essential to foster demand from SMEs, it is also necessary to encourage more NICT services, first to meet such demand and secondly to exploit the potential wealth of this sector, which generates entirely new activities and jobs requiring highly qualified skills.
 
Another aspect of the NICTs is that they revolutionise the concept of business and offer co-operation possibilities between businesses that were recently impossible. In many areas, they notably provide ways to capitalise on the strengths of SMEs (flexibility, fast response times, etc.) and to overcome their structural drawbacks (lack of critical mass, etc.). For example, the Web already enables SMEs to offer products and services throughout the world at minimum cost. It can also be used as a tool to forge close partnerships between SMEs without affecting their independence. It is therefore important to examine what has been done to encourage collective actions - successes as well as failures - and to draw conclusions in order to improve public policies.
 
Lastly, we need to improve efforts to monitor the use and dissemination of NICTs. It is difficult to take effective action if there is no way to evaluate the situation and its development. In this area, perhaps more than in any other, European co-operation is essential for effective results.
 
The work accomplished during the past two days therefore seems extremely important to me. The services of the Ministry of Industry will examine its conclusions carefully, since I believe that they offer ways to improve their efficacy and to strengthen European co-operation. I hope that this seminar will be the start of long-term co-operation between the European administrations responsible for NICTs and SMEs.