A meeting of young entrepreneurs from across the globe has agreed to a new action plan that supports start-ups and bolsters growth in the SME sector.
The G20 Young Entrepreneurs’ Alliance (G20YEA) Summit in Sydney has elevated investment in the SME and start-up sectors as critical to meeting the G20’s target of increasing global economic growth by an additional 2 per cent over five years.
The Sydney summit was attended by about 400 businesspeople, politicians and industry figures and featured addresses from a range of prominent speakers. Some speakers included Australian Chamber of Commerce and Industry head, Kate Carnell, Administrator of the United Nations Development Program, Helen Clark, and chief executive of Freelancer.com Matt Barrie.
In a communiqué released this afternoon, summit participants agreed to push for action in eight separate areas in order to create more high growth SMEs and reduce youth unemployment. The eight actions agreed to included:
1) Reform of global financial systems to provide better access to finance for SMEs and more effective regulation of new financing platforms (such as crowd sourced funding alternatives).
2) Better co-operation between business and education sectors to address labour market needs and skills shortages.
3) Embedding entrepreneurship programs within the education system.
4) Enhancing incentives leading to the commercialisation of new technologies.
5) Reducing the regulatory and tax burden for employers and employees.
6) Creating a new G20 multilateral “start-up visa” giving entrepreneurs more ability to conduct business internationally.
7) Opening up government procurement practices to small businesses owned by young entrepreneurs.
8) Ensuring there is a major goal in the UN post-2015 development agenda on youth employment and entrepreneurship.
“Investment in small and medium enterprises (SMEs) and young entrepreneurs is essential for the G20 countries to meet and exceed the additional 2 per cent increase in global GDP agreed in the Finance Minister’s declaration of February 2014, under Australia’s 2014 G20 chair,” the communiqué says. “Youth unemployment in the US and Canada is equivalent to 0.6 per cent of GDP, and over the next 18 years as a result of scarring (lost future earnings due to current unemployment) lost GDP will be 1.3 per cent.”
Ms Clark said if new ways were not devised to put millions of young people into work it could create a “generation of unemployed, alienated and disengaged youth – a time bomb”.
G20 YEA chair, Jeremy Liddle, called on the Australian government and other G20 nations to implement the action blueprint. He said the measures unveiled were aimed at reducing global youth unemployment to 10 per cent by 2030.
“In some G20 nations the rate of youth unemployment now exceeds 40 per cent for the first time in decades. In Australia, 2 in 5 of all unemployed people are aged between 15-24.”
An Ernst & Young report released just before the G20YEA found that youth unemployment across the G20 nations remained “high” at 16 per cent. It said that encouraging entrepreneurship was one of the possible solutions.
It forecast that entrepreneur-led businesses would create more jobs in the coming year than larger corporate players. It suggested that 76 per cent of entrepreneurs would expand their workforces in 2014 compared to only 31 per cent of senior executives at large corporations.
The report also made a series of recommendations that were presented to the summit including the creation of a new class of loan for small businesses that offered targeted funding to meet expansion capital needs. It also encouraged the implementation of tax benefits to encourage investment in start-ups.