Small- and Medium-Sized Enterprises
Small- and medium-sized enterprises (SMEs) make up about 99% of Canada’s businesses and account for 40% of gross domestic product (GDP) and 55% of all jobs. Yet only 7% of SMEs, Canada’s economic engine, are tapping into international customers and supply chains. The health of the Canadian economy moving forward will depend on helping more SMEs to grow through export.
EDC has made it a priority to help Canadian SMEs grow internationally, particularly in high-growth emerging markets. Recognizing that SMEs have fewer financial options than large corporations, we use a broad definition of SMEs that covers any company with annual sales under $50 million. In recent years, we have expanded our reach across Canada with additional sales and underwriting capacity to better serve SME exporters.
EDC provides SMEs with financing solutions such as direct lending and loan guarantees to financial institutions to encourage them to extend the financing an exporter may need. We also provide insurance products to protect against the risk of not getting paid by foreign buyers, as well as bonding and guarantee solutions.
In addition, EDC leverages its financing relationships with foreign buyers to encourage the purchase of Canadian goods and services and to introduce SMEs into their supply chains. Through our corporate website and channels like exportwise.ca, we provide support and education on getting ready to export and managing the risks. We also promote SME export success stories in local and international media.
The 7% increase in the number of SME transactions exceeded our 2015 objective of 0 to 5% growth.
We launched Trade Protect, a quick online credit insurance product for Canadian companies seeking to insure against non-payment by up to five of their U.S. or international customers. Transactions can be approved within 30 minutes.
170 SMEs participated in EDC’s mentoring program designed to help them grow their international sales. Under the program, selected companies with high export trade growth potential are given customized assistance to break into new markets, including market intelligence, exposure to procurement opportunities and introductions to key partners like the Trade Commissioner Service. Steelworks Design was one of these companies. Learn more about how EDC helped them on exportwise.ca.
Through matchmaking events, we facilitate introductions between SMEs and large players in their industry. We held 26 matchmaking events in 2015, including introducing more than 100 Canadian companies to interested foreign buyers at the Prospectors and Developers Association of Canada (PDAC) annual convention.
Where We’re Going
We’ve set a target of growing the number of SME transactions by 2% to 7% in 2016. Some of the growth will come by accepting additional risk in specific areas so our customers don’t miss out on potential opportunities.