FOR the third time in the last few months we are devoting this space to MSMEs—the micro, small and medium enterprises—for the central role they play in the solution of the country’s most serious socioeconomic problem: unemployment. More jobs are created per unit of capital invested in MSMEs than in large-scale enterprises.
We have always admired the spirit that leads to the establishment of MSMEs—the Schumpeterian creative spirit. The enterprise creates employment not just for the creator himself but for other people, as well. In addition, it contributes to the production of commodities and the generation of services that constitute the vital components of our gross domestic product.
The latest news on this topic comes from the recently concluded meetings of the Asia-Pacific Economic Cooperation country trade ministers held in Iloilo City. The ministers adopted the Iloilo Initiative that will, first, deal with problems that block MSME growth, like underdeveloped infrastructure, inadequate information on market opportunities across borders, lack of facilities to comply with border requirements, lack of access to financing; and, second, open up opportunities for growth, like linking up MSMEs through the digital economy and e-commerce with the value chains of the global economy by making it easy for MSMEs to gain access to markets across borders.
In the Philippines we are proud to say that we have influential organizations that are associated with the development and nurturing of MSMEs. Organizations like Go Negosyo of Joey Concepcion, the Villar Foundation and the Philippine Long Distance Telephone Co.’s SME Nation that has been awarding the MVP Bossing Award to outstanding entrepreneurs in the last several years. In the last celebration of Global Entrepreneurship Week, the British ambassador was a prominent guest.
Our words of support for financing MSMEs are not being given as an empty lip service. There is a Credit Survey Fund created by the Bangko Sentral ng Pilipinas (BSP) that extends no-collateral loans to MSMEs. We do not have the latest report, but the BSP’s target was to give out some P1.5-billion loans from this fund to MSMEs by the end of 2014.
The most important contribution of the Iloilo Initiative to MSME development is less the solutions it offers to MSME problems, rather old-hat solutions if you ask us, but more its opening up of new vistas of rapid growth for MSMEs in the global economy. Indeed, e-commerce offers a tremendous potential for accelerated growth. Online buying and selling, the linking up with huge enterprises here and abroad, selling and buying products and services of mind-boggling diversity would be challenging, to put it mildly. In these activities MSMEs must employ the services of computer-savvy assistants. No problem. We have many of these talented young people in the Philippines.
As they have responded with confidence and determination to myriad issues of the past, so will Philippine MSMEs, we are certain, respond with even greater confidence and determination to face the new challenges of doing business in the 21st century.
Image credits: Jimbo Albano