Manila, Oct. 25, 2023: Promoting post-pandemic recovery in Asia and the Pacific needed, to prioritise the development of micro, small, and medium-sized enterprises (MSMEs).
This is according to a new Asian Development Bank (ADB) report released on Tuesday.
Providing MSMEs with policy and data support can boost their role as drivers of growth in the future, said the Asia Small and Medium-Sized Enterprise Monitor 2023.
It focuses on economies in the Pacific, looking at how small businesses can contribute to resilient growth.
“Job creation is a critical challenge for Asia and the Pacific,’’ said ADB Chief Economist, Albert Park.
“In the Pacific, remittances sent by emigrants to advanced economies can support small businesses and create employment opportunities for women and younger workers.
“Tourism and agribusiness, where MSMEs actively participate, drive Pacific economies.
“Their sustainable growth helps strengthen MSME dynamism and raises national productivity,’’ Park said.
MSMEs remain important drivers of growth across developing Asia and the Pacific, accounting for an estimated 96.6 per cent of all enterprises.
That 55.8 per cent of the workforce, and 28 per cent of economic output on average, the report said.
Digitalisation offers new growth opportunities for small businesses and promotes formal business registration, “but many in the Pacific continue to use cash for transactions,’’ the report said.
The report noted that key constraints include underdeveloped infrastructure, limited e-payment options, a lack of supportive regulatory framework, and a lack of familiarity among small businesses with digital devices or limited literacy in digital operations.
Broadening alternative financing options, particularly digital financial services, can provide growth capital for innovative small firms and start-ups, helping build a national entrepreneurial base, the report said.