Regional trade is the most common form of trade for small and medium-sized enterprises (SMEs).SMEs typically look at neighbouring countries for their first international operation. In this context, SMEs are likely to encounter international value chains. Most international trade takes place within such value chains and – as shown in this report – many value chains operate mainly at a regional level. For most SMEs, value chains represent an entry point into internationalization. The discussion of regional value chains therefore takes a central stage in this report.