Senator assures DTI of R4-billion additional budget for MSMEs

The Department of Trade and Industry (DTI) has secured support from the Senate of at least R4 billion in additional allocation for micro, financing and equipment for micro, small and medium enterprises (MSMEs).

Trade and Industry Secretary Ramon M. Lopez told reporters covering the ASEAN 2017 MSME Development Summit at the Philippine International Summit that Senator Miguel Zubiri, who was also one of the panel discussants, already agreed that his committee on trade, commerce and entrepreneurship, will push for the additional MSME budget for next year.

According to Lopez, Zubiri has agreed to push for additional R2-billion budget on top of the current R1-billion funding for the microlending Pondo sa Pagbabago at Pag-asenso (P3) program and R1 billion for the Shared Services Facilities (SSF).

Lopez said that a R3-billion budget for P3 program would be good enough to make a dent against the illegal loan sharks or 5/6 operators in the country by next year.

He, however, said that some R30 billion would be required to totally wipe out the same amount of money in circulation by loan sharks operators, the main source of credit among MSMEs.

Lopez said that DTI has already lent out R740 million to MSMEs nationwide.

The DTI will be needing another R700 million to continue the program this year.

P3 microlending has prioritized the 30 poorest provinces. So far, DTI has already covered 65 provinces in the country.

Lopez also welcomed the additional budget for SSF next year. The government had allocated R1-billion SSF funding in 2016, but no budget was allocated for this year.

Lopez said DTI was also asking for R1-billion SSF budget this year but Senate is considering the grant of R200 million only. The DTI is looking for at least R500-million budget for 2018.

The SSF funding is used for the purchase of machineries and equipment like sewing machines and processing tools for shared use by members of cooperatives of MSMEs.

"There are already a total of 2,170 SSFs but we need more because of additional requirements for better machines like 3D printers for MSMEs," he said.

The Marikina shoe industry alone requires R40 million worth of machines needed by shoemakers.