The rise of MSME networks in Fiji
IF formally organised, they would probably be the most representative private sector group in Fiji. Micro, Small and Medium Enterprise (MSME) networks are strategically crafting their identity and as a result being recognised in critical policy spaces and therefore are being genuinely heard by the Government.
In my 18 years of working in the MSME development space, never have I witnessed such an active participation of MSME networks in Fiji’s business and entrepreneurial eco-system.
Perhaps it was the disproportionate impact of COVID-19 on MSMEs that got these business owners to form and strengthen their solidarity networks. However, one cannot understate the conducive environment for social dialogue created by this Government, that allows representatives of the sector that contributes 18 per cent to Fiji’s GDP and employs 60 per cent of workers, to have a voice.
What are these networks doing, to be recognised by Government?
The MSME networks were the first business and private sector group to meet with the Deputy Prime Minister and Minister for Trade, SME, Cooperatives and Communication, Manoa Kamikamica. In fact, within three weeks of the new Government coming into office, the MSME networks presented their priorities and strategically linking them to the Coalition Government’s first 100-day plan.
Recently, the most active group, the Fiji MSM Entrepreneurs Community (FMSMEC) was successful in lobbying the Reserve Bank of Fiji (RBF) to defer the phasing out of cheques by banks. At least until MSME’s are properly consulted and current digital banking challenges experienced by MSMEs understood.
Representatives of these MSME networks are genuinely engaging in and leading policy discussions in various key agencies and forums. They are not just ticking the box.
For the first time, an MSME representatives has been nominated to the Employment Relations Advisory Board (ERAB) under the Ministry of Employment, Productivity and Industrial Relations. An MSME representative is on the MSME Technical Working Group, created during the 2023 National Economic Summit and still operational under the Ministry of Finance, Strategic Planning, National Development and Statistics. An MSME representative is the chairperson of the MSME Finance Working Group of the Fiji National Financial Inclusion Strategy 2022-30 under the Reserve Bank of Fiji (RBF).
At the technical level, some members of the 15-member Fiji Business Development Services (BDS) Group is working with Polytech Pacific to strengthen their business curriculum. This network has also made formal submissions to Government and consultants drafting the MSME Strategy for the establishment of a BDS Council under MSME Fiji, as an advisory body aimed at strengthen Government initiated programs for MSMEs. If this is approved, this will be the first MSME group formally established under the Ministry of Trade, SME, Cooperatives and Communication.
Who are these networks and how do they operate?
FMSMEC was founded by a group of business owners in 2019 and during COVID-19 assisted with supporting laid of staff with food rations and keeping MSMEs informed of the constantly changing business environment and the COVID-19 business protocols. Today, FMSMEC has a membership of 250 entrepreneurs and eco-system supporters on Viber.
In the Creative Industries, the Fiji Islands Dance Association (FIDA) and the Viti Association of Visual Arts (VAVA) have a total of 200 members and use Messenger to communicate. While both networks existed informally pre COVID-19, they were formalised with technical assistance from the International Labour Organization (ILO), through a UN COVID-19 Recovery Project. FIDA has been engaging with the Fiji Arts Council (FAC) and the Fiji Islands Bureau of Statistics (FIBOS) for the monitoring of cultural statistics and through their policy submissions to Government.
The Fiji Small and Medium Enterprise Business Owners Network operates on Facebook and Messenger sharing business intelligence and seeking solutions for its 600 members.
In the tourism industry, Duavata Collective is made up of 17 small tourism operators and uses Facebook and Messenger. This network has crafted a place in the National Sustainable Tourism Framework Steering Committee and their attendance at the Tourism Exchange allows MSMEs in the industry
to be represented.
Community markets during COVID-19 helped many MSMEs survive. It immediately created the market places where MSMEs could actually sell their products and earn income. The RoC Market Group has a membership of 107, mostly home based MSMEs, and up to 130 vendors each market day. This network uses Messenger to link its members and communicate training and market opportunities.
We also have two unique networks, the Young Entrepreneurs Council (YEC) and the Women Entrepreneurs Business Council (WEBC), with a collective membership of 200 and both networks use Viber and Facebook to communicate with members.
WEBC has been supporting more than 100 women micro entrepreneurs a year to scale-up their businesses through the US-funded Academy for Women Entrepreneurs (AWE). YEC has been instrumental in advocating for access to finance for MSMEs, contributing to Government’s decision to create legislation on access to capital that will see equity crowdfunding and peer to peer lending enter the market.
WEBC and YEC are two of 10 councils under the Fiji Commerce and Employers Federation (FCEF) and they continue to be supported by FCEF to effectively lobby and advocate for an enabling MSME business environment. FCEF plans to soon formally establish an MSME Council which will potentially provide one umbrella body for all MSMEs and their networks in Fiji.
What makes these networks attractive, sustainable and scalable?
Members of these MSME networks vent, share business intelligence, discuss challenges and find solutions on their social media platforms a daily basis. These MSME networks engage directly with permanent secretary Shaheen Ali and the Director MSME Fiji Faizal Khan.
Embedded in these networks and easily accessible are technical experts such as Jenny Seeto, Jeff Liew and Richard Naidu. As a network member, you can directly ask the CEO of the Fiji Development Bank, Saud Minam, about loans, the general manager for Business Assistance Fiji, Ramesh Chand, about their grants and advisory services and even the CEO for Investment Fiji, Kamal Chetty, about promoting your business overseas.
Operating on social media platforms and the direct link with experts and key policy makers has created a lean model for MSMEs – no staff, no subscription, no office, very little in-person meetings, no labour intensive and money wasting conferences, allows for easy access to technical expertise, effectively eases doing business and ultimately contributes to improving the business and entrepreneurial eco-system.
These comparative advantages, which the current MSME networks enjoy, are what the new MSME Council will need to consider, if it is to attract and retain membership and ultimately be the collective voice of MSMEs in Fiji. The recent MSME Conference organised by Business Assistance Fiji (BAF) brought many MSME networks together. Delegates were provided with some recent statistics on MSME contribution to the economy.
The Fiji Revenue and Customs Service (FRCS) and the Fiji National Provident Fund (FNPF) presented that in the last three years, MSME total tax and total superannuation contribution was $452.5m. FRCS has a total MSME registration of 116,834 (22,789 pay tax) and FNPF has a total MSME registration of 6447. Of these, the majority 50-60 per cent are micro enterprises.
How does the networks help Government help MSMEs?
The emergence of these MSME networks have also made it easy for Government
to be inclusive in their recent consultations. Representatives of these networks were invited by Government for the consultations on the Access to Capital Bill and the MSME Strategy. I am certain the same courtesy will be extended to the MSME networks for the upcoming MSME Bill.
There is just too many MSMEs and the more organised and formalised these MSME networks are, the more effective is their interface with Government. According to the FNPF, out of the 7401 contributing employers, the majority 92 per cent are MSMEs.
These MSME networks have made collective and sector specific written submissions for the 2023 National Economic Summit and 2023-24 National Budget consultations. They are now crafting their submissions for the National Development Plan (NDP) and the 2024-25 National Budget.
Where are the gaps?
The majority of the MSMEs in Fiji operate in the informal economy. They are not necessarily captured in official statistics or FRCS and FNPF data and the majority are not necessarily part of the above-mentioned active networks. Some but very few are semi-formally organised like the municipal market vendors association and cooperatives, but are not active in daily interactions and proactively engage in policy discussions.
Simply put, they do not have an identity, therefore they are not recognised and as a result their voices are not heard.
Government and existing MSME networks must find a way to include informal economy MSMEs proactively engaged in regular business interactions and policy discussions.
In my 18 years of working in the MSME development space, never have I witnessed such an active participation of MSME networks in Fiji’s business and entrepreneurial eco-system. Perhaps it was the disproportionate impact of COVID-19 on MSMEs that got these business owners to form and strengthen their solidarity networks.
– Edward Bernard
■ EDWARD BERNARD (edwardandbernard@gmail.com) is a regional development consultant specialising in private sector/MSME development and disaster assessment and recovery. The views expressed in this article are his and are not necessarily shared by this newspaper.