Government sets P50-B funding for MSME development

MANILA, Philippines — The government intends to alleviate the plight of micro, small and medium enterprises (MSMEs) as it plans to shell out P50 billion for an assistance and development program until 2022, the country’s trade chief said yesterday.

“The President mentioned he will allocate P50 billion to support the MSME sector. It will be over five years or within the term of the President,” Trade Secretary Ramon Lopez said.

He said the budget would cut across many programs and projects for MSME development, most of which will be implemented by the Department of Trade and Industry.

Among the programs and projects are the micro-financing program called “Pondo sa Pagbabago at Pag-asenso” (P3), construction of more shared service facilities (SSF) across the country, and international trade promotion which will serve as pathways into the global market for MSMEs.

The P3 program has been introduced to replace the “5-6” money lending scheme, while SSFs are facilities that provide MSMEs access to technology, machinery, equipment, tools, systems, skills and knowledge under a shared system.

Lopez said the goal is to increase MSMEs’ participation in the economy.

“MSMEs are 99 percent (of our businesses) but they account only for 35 percent of our economy. That’s the challenge for me. I want them to account for 55 percent at least because in developed countries, MSMEs account for 50 to 55 percent,” Lopez said.

“That means we have less smarter entrepreneurs as of now. We want them to be smarter. Higher value adding means more income for them and that’s the way to really uplift their lives and technology is the way,” he added.

With technology seen as crucial in the government’s MSME development program, leading technology company Voyager Innovations announced yesterday that it is extending its digital transformation program to help equip MSMEs in the Philippines to become more competitive in the growing digital economy.

“Enabling MSMEs is critical to economic progress, all the more so for emerging economies like the Philippines. We need the strong support of various stakeholders and players under one advocacy – that of enabling our MSMEs with digital technologies. Voyager’s digital transformation program for MSMEs will jumpstart the digital transformation of small businesses in this country,” said Manuel Pangilinan, chairman of PLDT, Smart and its digital innovations arm, Voyager Innovations.

“MSMEs are critical to our economy. No business should be left behind—whatever the size, industry, sector or geographic location. It is our mission to ensure that we help them get on board the digital economy, specifically in the areas of access and digital marketing, digital commerce, and digital financial services,” Voyager president and CEO Orlando Vea added.

Under its Voyager digital transformation for MSMEs program, the company is setting up DigiHub, a facility in its Launchpad headquarters in Mandaluyong City that entrepreneurs can use as a space for consultation, mentoring, learning and sharing.

Through DigiHub, Voyager aims to foster collaboration, accelerate learning and catalyze best practices among industry leaders, big enterprises and MSMEs.

The facility will be fully operational by the first quarter of next year.