Economic Impact of Digitalization on SME Internationalization

Abstract

Rapid advances in digital technology are fundamentally changing the way small and medium-sized enterprises (SMEs) imagine and pursue opportunities overseas. This study assesses the economic impact of this transformation by balancing the advantages and hazards that online tools now present to firms ready to look beyond national markets. A systematic literature review, supplemented with field evidence, identifies factors such as infrastructure quality, managerial outlook, and external alliances that determine the depth and success with which SMEs integrate digital practices into their cross-border plans. The analysis showed that broader market access, faster supply chains, and data-informed choices often follow digital adoption. However, many companies remain hindered by cyber risk, skill shortages, and intensified global competition. Given these mixed results, this study offers actionable recommendations for policymakers and business leaders seeking to leverage digital capabilities to sustain international growth.

Keywords: Digitalization, SMEs, internationalization, Economic Impact, E-commerce