The government, through its state-owned banks, is ready to provide financial support to micro, small and medium enterprises (MSMEs) in the Philippines as they prepare to face imminent competition from their Southeast Asian counterparts once the region’s common market is established in the next few years, the Department of Finance (DoF) said over the weekend.
Its expression of support comes as the agency said government-owned lenders have extended more than P82 billion so far this year to entrepreneurs in the countryside to help them expand their businesses.
“This is an exciting time to be an entrepreneur. The reforms are [making the government shift]to the role of enabler, rather than [being a]hindrance to business. The economy is rapidly expanding. Regionalization is progressing at a breathtaking pace,” he said.
The growth of the MSME sector, which employs nine out of 10 Filipinos, is key to achieving inclusive growth not only in the Philippines, but also in other Southeast Asian countries.
“I encourage entrepreneurs to look closely at the processes of regionalization. In the next few years, we expect to have a common market for the Southeast Asian economies. That will translate dramatically into an expanded market for all MSMEs in the region. [But be prepared] to compete for a larger share of that market,” Dominguez said.
Entrepreneurs will be able to reap the benefits from regionalization and the country’s rapid economic growth “only if they remain alert to opportunities and passionately committed to innovation,” he added.
According to Dominguez, the Land Bank of the Philippines (LandBank), provided outstanding loans to entrepreneurs totaling P71 billion from January to September this year.
Another state-run financial institution, the Development Bank of the Philippines (DBP), extended a total of P11.6 billion to MSMEs in the first 10 months of 2017.
DBP also unveiled plans to increase the number of its account officers serving this sector by 25 percent to beef up its operations in 22 strategically located lending centers starting in January.
Besides making funds available for entrepreneurs, Dominguez said the government is also instituting reforms to make doing business much easier. These include setting up the online trading platform TradeNet to fully automate licensing, permit-issuing, clearance and certification systems, and the Inter-Agency Business Process Interoperability program that aims to simplify and harmonize import and export documentation.
The DoF also formed an anti-red tape task force to cut redundant requirements and processes in the bureaucracy, he added.