Apart from various inter-governmental dialogues and high-level political forums, APEC (Asia-Pacific Economic Cooperation) 2022 Conference also served as a platform for private sectors to discuss regional business challenges via the APEC CEO SUMMIT. The forum is not only for the CEOs or top business executives to get the opportunity to build an unmatched network but also for smaller companies to gain inspiration and acknowledge the momentum of the global economy.
MSMEs AS THE ENGINES OF GROWTH AND INNOVATION
According to the 2022 Leaders' Declaration at the APEC conference, businesses of all types— particularly micro, small and medium-sized enterprises (MSMEs) and start-ups—are recognized as one of the most defining factors for post-COVID-19 economic recovery. MSMEs account for over 97% of all businesses and employ over half of the workforce across APEC economies. This fact reinforces how sustainability and resilience in the business world could not be achieved without the transformation of MSMEs. However, while MSMEs' share of GDP ranges from 40% to 60% in most economies, they only account for 35% or less of direct exports. This number illustrates that although these small-scale enterprises are influential in the market, there is still a gap that they urgently need to fill with their competitive advantages, specialization, innovation, and expansion into the international markets.
SMALL AND MEDIUM ENTERPRISES WORKING GROUP STRATEGIC PLAN
Due to concerns about the future of MSMEs and their ability to adapt to a disruptive world, the SME Working Group (SMEWG) was established in February 1995. Nearly 30 years of operation, all the while keeping the same goals in mind. To drive the inclusive development of sustainable, resilient, and innovative SMEs. With SMEWG’s mission “to encourage the development of MSMEs and to build their capacity to engage in international trade,” it has become the main forum where APEC countries exchange information, views, best practices, and analysis concerning SMEs in the region.
The SMEWG Strategic Plan for 2021 - 2024, first introduced in 2020, provides a regional foresight for micro-enterprises to address critical issues hindering their growth and global engagement. The SMEWG recommendation consists of 5 top priorities MSMEs should take into account; entrepreneurship, the global value chains (GVCs), digitization, access to finance, and public-private partnerships.
MSMES LEADING THE WAY
To elaborate, MSMEs should foster innovation to strengthen business competitiveness. Firstly, by endorsing an innovative culture, all employees can be ingrained with an entrepreneurial mindset. In the short term, businesses that have been through a cultural transformation face some difficulties in shaping people's soft skills. However, they will be able to grow sustainably with an innovative workforce as the foundation. Rather than just local partnerships, MSMEs can increase their involvement in the global value chains by promoting foreign trade and investment trade fairs and matchmaking. This can be done along with aligning their operations with international standards such as WTO rules and other multilateral trade agreements. MSMEs' development toward digitization and access to finance is the core enablers for future growth. When technology is adopted, the company can make data-driven decisions with more accurate expected results. Moreover, new financial advancements such as innovative financial and data-based lending instruments are also the opportunity to come with digitization that could unlock the company's full potential. The competitiveness in government procurement, however, remains attractive for MSMEs. For example, government or international tenders intended specifically for MSMEs execution and tenders can be implemented jointly by micro-enterprises.
These priorities are not limited to just MSMEs’ practice but resonate with businesses of all types, large or small. To incorporate every significant issue into the core strategy, companies will be able to tap into the global market with shared values and grow more relevant in today’s business environment.
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