Exporters want ₧20B slashed from CCT funds for MSMEs
PHILIPPINE exporters want the government to establish a P20-billion emergency lending fund, which can be sourced from the P64-billion Conditional Cash Transfer (CCT) Program, to spur the development and competitiveness of micro, small and medium enterprises (MSMEs).
Assistant Vice President for Advocacy and Communications the Philippine Exporters Confederation Inc. (Philexport) Ma. Flordeliza Leong said the proposal has been transmitted to the office of Trade Secretary Adrian S. Cristobal Jr. The fund, as proposed by Philexport, should be administered by the Small Business Corp. (SB Corp.), the financing arm of the Department of Trade and Industry catering mainly to the MSMEs.
“The concept is, because MSMEs are having difficulty sourcing or accessing funds from the bank, we’re looking for all sources, and we are suggesting carving out P20 billion from the CCT Program, which is P64 billion, to serve as an emergency fund for MSMEs to be administered by the SB Corp., which has a mandate for SME development,” Leong said in a recent interview.
To make the availment of funds easy for MSMEs, Philexport suggests imposing no collateral and setting a low interest rate with minimum documentary requirements.
Since the amount will serve as an emergency fund to finance what the organization defines as “high-impact programs” for export competitiveness, the government should consider credit exposure of about 25 percent of the proposed P20 billion.
Leong emphasized that substantial funds are needed to be directed to product development and export promotions, especially for traders coming from trade shows abroad.
“We cannot guarantee everyone of our members could be beneficiaries; but there are projects that are just waiting to be funded,” she added. The SB Corp. could set the metrics for the viable projects eligible for funding.
Philexport underscored the urgency of government support for export promotions, as the onset of economic integration in the Asean region is pitting Philippine-made exports with those of its neighbors.
According to the group, because of production costs, Philippine products are still more expensive than their Asean counterparts even with the lower tariffs. This is aggravated further by the fact that other Asean exporters receive government financial aid for trade-fair participation.