The SME Performance Review, published earlier this year, analysed the performance of SMEs across Europe in 2008, thus allowing for a comparison between different EU member states.
The Commission's so-called 'SBA policy radar' for Ireland "yields a remarkably positive picture" in comparison with other countries, according to the report.
Particular strengths in 2008 were the Irish public's attitude towards entrepreneurs - 85% of Irish citizens agree that persons growing a successful new business receive high status, while the EU average is only 69% - and in the area of skills and innovation, where Ireland again "outperformed the EU average by a considerable margin".
Boom and Bust
However, as the "economic miracle" of Ireland's so-called 'Celtic Tiger' era slowed, ultimately leading to the country's worst recession in 20 years, the difficulties facing Irish SMEs increased exponentially, arguably calling into question the validity of the Commission's 2008 appraisal.
The main problem, as indicated by the head of the Irish Small and Medium Enterprises Association (ISME) in an interview with EurActiv, is the current difficulty faced by SMEs in accessing bank credit.
"Sound, profitable, long-standing businesses are finding it difficult to get access to bank credit because of the banks' perception that SMEs are a high-risk sector," ISME Chief Executive Mark Fielding said.
Indeed, ISME last month (May) published a survey indicating that in the first quarter of 2009, almost 60% of companies were refused credit by Irish banks.
An Irish Department of Enterprise official contacted by EurActiv agreed that Ireland's SME environment has unquestionably taken a turn for the worse, noting that "the banks have become very cautious in terms of lending".
However, the official also argued that surveys such as ISME's must be taken with a pinch of salt and may not be entirely reliable, a point emphasised by Irish Enterprise Minister Mary Coughlan, who said the findings "needed to be put in context".
The official acknowledged the severity of the challenges currently facing Irish SMEs, but he also claimed that the validity of the Commission's Irish SME review is not wholly undermined by the country's economic downturn. "The government has been very proactive," he claimed, arguing that many of the Commission's positive indicators remain true today.
Government aims to get credit moving
As an example, the official cited the Irish government's recent establishment of a Credit Supply Clearing Group, which is responsible for identifying and unblocking the flow of credit to "viable businesses".
Ireland retains a "proactive business environment," according to the official, and remains a good place to start a business.
Many of the good points in the Commission's 2008 review remain in place, he said, arguing that this proactive attitude both within government departments and in the business sector means that Ireland has a strong foundation to regain the lofty status accorded to it by the Commission in 2008.
"It shouldn't be all negativity," he concluded.
