SEC sees more listings, MSMEs going public

MANILA, Philippines — The Securities and Exchange Commission (SEC) is targeting to list 888 companies by 2024, with more micro, small and medium enterprises (MSMEs) joining the roster of listed firms.

The agency said it plans to build an office dedicated to promoting the interests of MSMEs, recognizing the sector as a vital part of the economy.

SEC chairman Emilio Aquino Jr. said that in 2020, MSMEs accounted for 99 percent of business enterprises operating in the country.

MSMEs account for 62.66 percent of the country’s total employment.

The so-called Office for the Advancement of Strategic Investments in SMEs (OASIS) will help set up the capital market as a viable alternative to raising capital for MSMEs.

The SEC aims to simplify the capital-raising products and streamline the registration processes for SMEs; encourage investment houses and other financial institutions to conceive and implement an SME-friendly underwriting and engage multilateral agencies such as the Asian Development Bank and the International Finance Corp. in launching SME-focused investment funds.

The new office will also collaborate with other government offices and the private sector in developing the appropriate ecosystem for SMEs, both developmental and regulatory.

“Most of them lacked the funds necessary to bounce back, with the magnitude of the working capital shortage more serious in smaller firms. Further, this prolonged pandemic made it more difficult for MSMEs to raise funds from formal financial institutions and to survive the crisis,” Aquino said.

“The sector’s ability to access finance faces constraints even during non-crisis periods. As some areas are moving to the recovery stage, MSMEs continue to confront a sharp drop in demand and revenue, specially as we deal with the continuing threats of COVID-19,” he said.

Aquino also said the SEC wants to see more MSMEs going public. “An initial public offering can benefit a growing company in countless ways. It allows a company to raise money to fund operations, expansion, fuel growth, fund recovery and pay down debt. It propels progress, opportunities, recovery, employment, livelihood and all things related to building up,” he said.