A Philippine-led initiative to support micro, small, and medium enterprises (MSMEs) took center stage in the first Asia-Pacific Economic Cooperation Senior Officials’ Meeting (APEC SOM1) in Lima, Peru last week, the Department of Trade and Industry (DTI) reported.
Trade Undersecretary Ceferino S. Rodolfo, who led the Philippine delegation to APEC, said that the meeting welcomed the Philippine-led initiatives under the Boracay Action Agenda to Globalize MSMEs (BAA-MSMEs) to further mainstream MSMEs into global value chains (GVCs).
“At the meeting, the Philippines strongly advocated sustaining the gains we have achieved to integrate MSMEs in the global value chain in this APEC year. APEC 2016 is helping us advance specific, concrete, and practical interventions that contribute to efforts to achieve truly inclusive growth that benefits all member economies,” said Rodolfo.
Rodolfo said Peru had expressed strong support of the initiatives last year and has likewise encouraged succeeding hosts of APEC—Viet Nam in 2017 and Papua New Guinea in 2018—to adopt a multi-year approach in their hosting.
The Philippines is also successful in proposing a “reporting template” to track developments of member economies in implementing BAA-MSMEs to benefit global enterprises, as well as a midterm review of improvements in 2018 and final review and reporting in 2020.
Rodolfo said senior officials from APEC member economies was supportive of the proposed review dates, which will be continuously discussed in the succeeding APEC fora.
The DTI undersecretary said the Philippine delegation also urged APEC member economies to integrate their MSMEs into regional and production networks during the APEC SOM1 in Peru.
“MSMEs provide critical support and complementation to larger enterprises. Governments are in a position to support MSMEs by building MSME capacity and implementing regional and global approaches,” Rodolfo added.
The BAA-MSME is an implementation plan endorsed by APEC member economies in the APEC Concluding Senior Officials Meeting (CSOM) in Manila in November last year.
The plan contains concrete intervention, programs and targets that aims to integrate APEC MSMEs in international markets through global value chains or as direct exporters of finished goods and services. It also lists initiatives such as utilizing trade facilitation, trade finance, and e-commerce that address trade and non-trade barriers to MSMEs trading internationally.
An example of support activity to integrate MSMEs in the global value chain is the Philippines’ work with Malaysia in implementing the Global Value Chain-SME for Automotive Sector (GSAS) project.
The GSAS project aims to illustrate global value chain (GVC) mapping in the region, identify best practices in GVC integration, and determine non-tariff barriers on trade and investment that MSMEs face, before developing practical solutions to address these barriers.
Patterned on the GSAS project, Rodolfo said APEC member economies are now working on the development of a program integrating automotive-related MSMEs into the GVC.
“APEC member economies will now work on targeted technical capacity building through the development of the APEC Regional Automotive Supplier Excellence Program (RASEP),” Rodolfo said.
In another automotive-related initiative, the DTI is pursuing the six-year implementation of the Comprehensive Automotive Resurgence Strategy (CARS) Program, which aims boost local vehicle manufacturing and engage key players including MSMEs to participate in various production activities within global value chains, such as automotive parts and components manufacturing and whole vehicle assembly.
The CARS Program will provide fiscal incentives for investments in the manufacture of three main model units, as well as other car parts that are not currently produced locally.
“Going forward, the Philippines will work closely with all member economies to advance our current plans and commitments that will strengthen the capacity of MSMEs to participate the in regional and global economy, thus driving economic growth and prosperity,” Rodolfo concluded.