Philippine Daily Inquirer

SMEs seen to play crucial role in global trade

- By Amy R. Remo

MICRO, small and medium sized enterprise­s (MSMEs) are touted as the next frontier for expanding trade and growth as they are expected to take an increasing­ly crucial role in boosting the overall welfare across Asia-Pacific Economic Cooperatio­n (Apec) member economies.

It would thus be necessary for Apec leaders to adjust the policy reform lenses to make it easier for MSMEs to be part of internatio­nal trade and global value chains, said Ramon Clarete, former dean and current professor of the University of the Philippine­s (UP) School of Economics.

“Economic welfare gains are higher with global MSMEs. There will be more variety of products as more MSMEs become exporters, average productivi­ty will rise as more resources get allocated to exporting enterprise­s, and competitio­n in the global market will intensify which, in turn, will lower the average costs of products. Thus, it is only reasonable to seek trade reforms, policies, and regulation­s that will engage more MSMEs in the global market,” Clarete said in one of the Apec meetings held recently in Cebu.

“There is an added advantage to adjusting policy reform lenses toward addressing the barriers that particular­ly impinge on the participat­ion of the largest group of businesses—the MSMEs. Inclusiven­ess does not only distribute the gains from trade more equitably among trading partners, it also increases the pie significan­tly,” Clarete added.

According to Clarete, more exports from MSMEs means having diversifie­d products, increased productivi­ty and increased competitiv­eness.

Similarly, Assistant Secretary Ceferino S. Rodolfo stressed that in enabling MSMEs to participat­e as direct exporters or as service providers in the global value chain, economies can look forward to increased trade flows globally.

“Like many developing countries, the Philippine­s will need to work hard to achieve the integratio­n of MSMEs in global trade. The meetings and dialogues held in Cebu the past two weeks have yielded specific, concrete, and practical initiative­s that Apec economies will implement to provide MSMEs wider opportunit­ies to integrate into global or regional trade,” Rodolfo said.

The Philippine­s circulated the “Apec Implementa­tion Plan for the Boracay Action Agenda to Globalize MSMEs” which outlined the possible work streams and indicators of progress per priority action.

According to Rodolfo, this was intended to be regarded as a ‘living document’ to guide officials and also to draw from the expertise of sub-fora, committees and working groups to fulfill the Boracay Action Agenda’s (BAA) objectives.

The BAA is an action-oriented initiative geared toward addressing the bar- riers faced by MSMEs in internatio­nal trade. The priority areas for cooperatio­n and action were identified as trade facilitati­on, e-commerce, financing and institutio­nal support.

Rodolfo said the draft implementa­tion plan included streamlini­ng of processes for rules of origin (ROO), addressing issues of compliance to regulatory requiremen­ts, capacity building, bridging informatio­n requiremen­ts of MSMEs when they try to access global markets, and resiliency during disasters, among others.

 ??  ?? WITH MSMEs touted as next frontier for expanding trade and growth, it will be necessary for Apec leaders to adjust the policy reform lenses to make it easier for MSMEs to be part of internatio­nal trade.
WITH MSMEs touted as next frontier for expanding trade and growth, it will be necessary for Apec leaders to adjust the policy reform lenses to make it easier for MSMEs to be part of internatio­nal trade.
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