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Crisis resilience and appropriate policy environment keys to SMEs survival and growth

Posted: 2013-11-07
Category: EPA Announcements

According to a report by the Asian Development Bank (ADB), the estimated average loss incurred by Southeast Asia from disasters is more than $19 billion every 100 years, and only 5% of disaster losses in developing Asia are insured, compared to 40% in developed world. MSMEs are also vulnerable to economic crises and to poor governance.

With MSMEs powering economies across Asia, crisis resilience will become more important for enterprises moving forward. For Asian Institute of Management (AIM) Policy Center Executive Director Dr. Ronald Mendoza, crises brought about by natural disasters or economic meltdowns provide enterprises with an opportunity to reduce their vulnerability.

“Crisis-resilient firms are an important component in developing crisis-resilient communities,” said Asian Institute of Management Policy Center Executive Director Dr. Ronald Mendoza. “Communities can recover faster when enterprises, investments, and jobs are back to normal. In some cases, crises can offer enterprises opportunities to expand and innovate, and further improve their competitiveness.”

With MSMEs contributing anywhere between 32% to 77% of total domestic output among Southeast Asian economies, it is crucial for governments, development organizations, and enterprises to collaborate to create inclusive growth.

“Sustaining industrialization requires entrepreneurs from smaller and medium scale firms to develop new products and services. This will fuel a growth process that is not merely dependent on certain industries or on migrant remittances,” said Mendoza.

Governments will need to develop policies that take inspiration from context-specific evidence, while also taking into consideration the upcoming regional integration, the ASEAN Economic Community in 2015.

“For SMEs in Asia to live up to their potential, our policymakers need to draw from context-specific evidence,” said Mendoza. “In Malaysia, foreign direct investments in the high-technology sector create spillovers that benefit both large and small firms. Policy makers can help MSMEs by authoring laws that would establish these connections, which would allow MSMEs to take advantage of relevant technologies and improve their productivity.”

Added Mendoza, “Policies should support the emergence of competitive firms, while recognizing that not all firms will be able to survive in the long run. Developing nuanced policies that address MSME obstacles will require a balance between supportive and pro-competition policies.”


For more information about this press release, please contact:
Marco Sindiong/Eunice Braga
Ogilvy Public Relations Manila
Tel: (632) 238 7000 loc. 7042 or 7111 or




Great article. Thank you for sharing

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