Mainstreaming MSMEs into value chains needed

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MAINSTREAMING micro, small and medium enterprises (MSMEs) into value chains has become more urgent in light of global trends to integrate trade and de-integrate production, a Philippine Institute for Development Studies (PIDS) report showed.

The “Mainstreaming SMEs: Promoting Inclusive Growth in APEC (Asia-Pacific Economic Cooperation)” report said the development policy on MSMEs should focus on mainstreaming to stimulate inclusive growth and enable them to drive it.

In pursuing SME development as a major domestic policy objective, the global and regional environment can no longer be ignored, according to the report, which was published last month.

“A more global perspective has become increasingly important with the integration of trade and de-integration of production arising from globalization forces and technological development,” it said.


“A more immediate goal for the government is to mainstream MSMEs in value chains, whether local or global,” it added.

The report said that once SMEs are mainstreamed into global value chains, “the prospects and benefits are magnified, as these benefits redound to a larger economic system.”

“SMEs that are mainstreamed in the international market generally perform better in productivity, competitiveness, innovation and sustainable growth, compared to those dealing only with the domestic market,” it added.

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