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László Csonka

Small and medium enterprises (SMEs) active in a global environment rely increasingly on more extensive and geographically more dispersed external relationships. In an open and relatively small economy such as Hungary, it is crucial for local enterprises to be connected with international partners. This chapter explores the way Hungarian SMEs collaborate with external partners in research, development and innovation (RDI) activities. The research is based on a survey conducted among three sub-groups of SMEs: RDI-active companies, companies involved in RDI-supporting government programmes and random companies in high-tech industries. The responses cover four main industries: a) biotechnology, b) medical instruments, c) information technology and d) engineering services with respondents mostly employing under 50 employees. The data reveal that although the vast majority of firms in the survey are innovative, less than one-third participates in any kind of networking. The information sharing networks (based on professional associations and chambers) are rather ubiquitous and only a few substantial RDI networks (measured by maturity and intensity of collaboration) exist in the collaboration ‘portfolio’ of the respondents. The SMEs’ responses suggest that networking is generally a process started with national partners and that international expansion only follows after a number of years if a strong intention to establish durable relationships is present. The primary motivation for international networking is to develop already existing relations further. At the same time, an unstable economic and RDI environment in Hungary complicates long-term planning by companies and suppresses RDI networking.