APEC trade ministers agree to support MSMEs
Recognizing the important role micro, small and medium enterprises ( MSMEs) play in promoting economic growth and job creation, trade ministers of the 21-member Asia Pacific Economic Cooperation (APEC) have adopted the proposal of the Philippines to support the sector’s participation in global trade.
During the APEC Ministers Responsible for Trade (MRT) Meeting held in May, the trade members agreed to endorse the Philippines’ proposed Boracay Action Agenda to the leaders of the regional economic group’s members who are set to meet in Manila this week.
Trade Secretary Gregory Domingo who served as the chair of this year’s APEC MRT Meeting said the Boracay Action Agenda is an initiative which seeks to support the ongoing efforts of APEC to address the barriers being faced by MSMEs in international trade.
The proposal calls for specific and concrete interventions APEC economies can implement to provide MSMEs more opportunities to take part in global or regional trade either through global value chains or as direct exporters of finished goods and services.
It likewise seeks to put focus on micro and small enterprises since their needs are different from those classified as medium enterprises.
“That distinction is important because the type of interventions required to assist micro and small enterprises and to bring them into the global trade fold... may be different,” Domingo said.
At present, micro and small enterprises represent more than 60 percent of total businesses in the APEC.
While not all micro and small enterprises can participate in global trade, there are those qualified to export, making it necessary for APEC economies to simplify processes to enable them to easily benefit from trade.
“We should really develop a channel for them to make it easier because current rules make it difficult for them to participate, especially in availing of free trade agreements… For the most part, we need to come up with programs, new rules, to make it easier for micro and small (enterprises) to participate in global trade,” Domingo said.
In line with the push to make it easier for MSMEs, particularly the micro and small enterprises to tap opportunities both in regional and global markets, APEC trade ministers said in a joint statement they have identified priority areas for cooperation such as trade facilitation, e- commerce, financing as well as institutional support to address the barriers faced by the sector.
APEC trade ministers have also agreed to support other efforts to advance the participation of MSMEs in regional and global trade by facilitating access to free trade agreements.
In particular, APEC trade ministers will work on simplifying and streamlining rules of origin or the criteria to determine the national source of a product, as well as other procedural and documentary requirements.
The trade ministers will likewise work on making it easier for MSMEs to comply with customs-related rules and regulations.
The trade ministers will also collaborate to ensure that timely and accurate information on export and import procedures in the APEC’s member economies are made available to MSMEs.
As access to financing is among the challenges faced by MSMEs, APEC trade ministers will come up with measures to provide more options to facilitate lending to the sector.
With more individuals purchasing goods online, APEC trade ministers will provide support to MSMEs to tap opportunities to expand their markets through Information Communications Technology (ICT) solutions.
“We welcome strengthened information sharing and stronger coordination across relevant APEC fora to enhance complementarity of projects and initiatives and promote efficient use of resources in implementing the Boracay Action Agenda,” the APEC trade ministers said.
APEC trade ministers also plan to seek the help of the private sector, particularly the APEC Business Advisory Council (ABAC) composed of senior business people from each member of the regional economic organization, in efforts to encourage more MSMEs to participate in regional and global trade.
Aside f rom ABAC, APEC trade ministers will engage with representatives of international organizations to further push the initiative for MSMEs.
The Philippines is hopeful the Boracay Action Agenda would be given a favorable response by the APEC economic leaders who are meeting this week.
This, as fostering MSME participation in regional and global trade is among the priority areas of focus of this year’s APEC meetings.
Domingo also said the Philippine government intends to work with Peru which serves as the chair of next year’s APEC meetings in order to pursue the aim of the Boracay Action Agenda.
The APEC’s 21 member economies meet annually to discuss actions to be taken to boost trade and growth in the region and ensure the benefits of such are widely felt.
Aside from promoting MSMEs’ participation in regional and global trade, other priority areas of focus in this year’s meetings include enhancing regional economic integration, investing in human capital development, and building sustainable and resilient communities.