Smith has joined Twente on a season long loan.
The 18-year-old midfielder has one full Wales cap - having made his debut against Mexico earlier this year.
Smith impressed in City's youth sides last season.
He said: “I am looking forward to playing for FC Twente. Recently I have seen a lot of the club and I am impressed how massive FC Twente is. It's fantastic how many supporters continue to support the club, I'm happy with the chance I get here."