Small and medium enterprises (SMEs) are the engines of growth and innovation in the APEC region. SMEs account for over 97 per cent of all enterprises and employ over half of the workforce across APEC economies. SMEs contribute significantly to economic growth, with their share of GDP ranging from 20 per cent to 50 per cent in the majority of APEC economies. However, they only account for 35 per cent or less of the direct exports. APEC’s Small and Medium Enterprises Working Group (SMEWG) therefore works to encourage the development of SMEs and to build their capacity to engage in international trade.

SMEWG works toward the achievement of APEC’s Bogor Goals by fostering an enabling business environment for SMEs to grow and develop into export-ready firms. The APEC SME Ministerial Meetings, held annually since 1994, set out the direction for the working group. In September 2016, the SME Ministers endorsed the SMEWG Strategic Plan for 2017-2020 which provided a roadmap to address critical issues pertaining to the growth of SMEs and micro enterprises (MEs) in the APEC region: 

• Entrepreneurship, innovation and the internet and digital economy
• Financing for business expansion and capability development
• Inclusive business ecosystem that supports SME growth
• Market access for SMEs

Peru, as last year’s hosts put modernizing MSMEs as one of 2016’s priorities, with four focused issues:

• Promoting innovation and MSMEs connectivity
• Moving forward to integration and development through productive infrastructure
• Integration of green MSMEs into GVCs
• Internationalization of MSMEs and their integration in GVCs

The 23^rd SME Ministerial Meeting was held in Lima on 9 September 2016, where a statement that promotes the theme “SMEs as engines of quality growth and prosperity” was released. Through sponsorship from Canada, the MSME Sub-fund, under the APEC Support Fund (ASF), was established in June 2016 and aims to directly involve APEC MSMEs in project activities to support the building of inclusive economies through MSME-led poverty reduction. More information about this MSME Sub-fund can be found here.

Last page update: 20 October 2017

In 2017, under the overarching theme “Creating New Dynamism, Fostering a Shared Future,” APEC continues to highlight MSMEs as one of its key priorities, particularly, “Strengthening MSMEs’ Competitiveness and Innovation in the Digital Age.” This priority encompasses:

• Facilitating MSMEs’ greater participation in the global value chains (GVCs)
• Facilitating the business environment for MSMEs in the digital age
• Promoting start-ups and innovative SMEs

2017 is also the first year where the Small and Medium Enterprises Working Group focused on the implementation of Strategic Plan 2017-2020, which has four priority areas:

1. Entrepreneurship, innovation and the internet and digital economy.

• Promote an entrepreneurial culture amongst the youth, women and other individuals
• Foster innovation in SMEs to strengthen business competitiveness
• Help SMEs to build capabilities to take advantage of and compete effectively in the internet and digital economy
• Support SMEs development in specific industries based on the economic development  needs of individual member economies 

2. Financing for business expansion and capability development

• Improve SMEs’ access to financing and funding support for business growth
• Discuss and understand emerging financing mechanisms and tools for SMEs

3. Inclusive business ecosystem that supports SME growth:

• Work towards a transparent and pro-business environment with equal opportunities for SMEs
• Encourage simplification and harmonization of regulations and other administrative guidelines
• Strengthen institutional support to help SMEs overcome regulatory and procurement hurdles
• Enhance public-private sector collaboration to support SMEs development

4. Market access for SMEs:

• Promote integration of SMEs into global value chains
• Strengthen SMEs’ export capabilities and capacity for internationalization
• Enhance collaboration between SMEs, micro and large enterprises for the purpose of market access

The SMEWG gathered twice during 2017. The 44th SMEWG Meeting was held in Sydney on 15-16 March, and the 45th SMEWG Meeting took place in Ho Chi Minh on 13-14 September, prior the 24th SME Ministerial Meeting. During their meeting, Ministers endorsed the Strategy on Green, Sustainable and Innovative MSMEs, an Initiative on innovative startups and officially launched the APEC MSME Marketplace.