Global Economics

Poor Language Skills Hurting EU Firms


Brussels says the bloc's global competitiveness is at stake, as 11% of small businesses have lost out on revenue thanks to foreign language deficiencies

Europeans must improve their language skills to ensure Europe's competitiveness in the global market, Brussels has warned, as 11 percent of EU small and medium-sized companies have lost an export contract and miss out on revenues due to their staff's poor knowledge of foreign languages.

According to a study presented by EU multilingualism commissioner Leonard Orban, EU businesses lost on average €325,000 each over a three year period due to communication barriers.

"Far from being an unwelcome cost to doing business, investing in language skills can dramatically improve a company's business opportunities", Mr Orban said, underlining his "plan to place multilingualism at the heart of the Lisbon strategy for more growth and jobs."

Mr Orban criticized European SMEs for relying on national education systems to provide them with multi-lingual employees, instead of investing in the language training themselves. Only 48 percent of businesses claim to offer language training to their staff, although a similar number of companies (46 percent) plan to enter new export markets in the next three years.

Citing a clear link between languages and export success, the study offers a company several hints for scoring better in the market place, such as having a language strategy, appointing native speakers, recruiting staff with language skills and using translators or interpreters. An SME investing in these four policies was calculated to achieve an export sale proportion 44.5 percent higher than one without these investments.

The study also shows that English remains the key language for gaining access to export markets, although in large companies expanding beyond Europe's borders Spanish, Russian, Arabic and Mandarin are on the rise.

The Romanian commissioner - able himself to speak English, French and Italian aside from his mother tongue - pledged to push EU capitals to establish a better link between education and business. But he also admitted that "the room for manoeuvre is small", as education is a national matter.

Mr Orban's media appearance - the first one after having taken up his position in January - revived questions about the relevance of having a portfolio to govern EU languages, with some asking what was the added value of today's report.

According to Marco Incerti from the Centre for European Policy Studies it was "useful to remind" EU capitals of their homework, but he also added that the multilingualism portfolio was "rather an artificial one to keep one person busy".

"It could have been incorporated into all agendas", Mr Incerti said, pointing out that linguistic matters run through several areas such as education, social affairs and economy.

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