APEC Propelling SME Development to Ensure Asia-Pacific Growth
Improving market access and conditions that support the integration of small and medium enterprises into global value chains are among the priorities.
A message from APEC Secretariat Executive Director Alan Bollard
Originally published in China Daily on 4 September 2014
The acceleration of economic recovery and strengthening of long-term growth and prosperity in China and the other 20 members of APEC, the world’s largest economic region, hinges on the development of the small and medium enterprise sector, which is at its core.
This week, ministers from APEC economies have gathered in Nanjing to create a more fertile environment for SMEs, which account for more than 97 percent of all businesses, employ more than half the workforce and account for 60 percent of gross domestic product across the region.
An important component of this effort is bolstering the ability of SMEs to take advantage of cross border business opportunities. Despite the size and importance of the sector, its share of exports in the Asia-Pacific region is still relatively low.
Ministers will take steps to eliminate barriers to participation in trade between APEC economies. Improving market access and conditions that support the integration of SMEs into global value chains are among the priorities.
Part of this is helping SMEs better understand procedures such as certifications that are required to ensure the integrity of the products produced within supply chains of opportunity-rich sectors such as agriculture and food processing, electronics, automobiles and handicrafts.
At the same time, ministers recognize the urgent need to take greater action to safeguard vulnerable businesses against the effects of natural disasters such as earthquakes, floods and typhoons that strike China and other APEC economies more than anywhere else on earth.
Emphasis is on enhancing emergency preparedness, including through the promotion of business continuity planning, which is limited among many SMEs but essential to raising their capacity to keep up and running, ensure livelihoods and limit disruptions to production chains in a disaster.
Ministers are furthermore poised to tackle challenges facing aspiring entrepreneurs and start-ups that stifle commercial development, job creation and trade and economic growth.
Improving access to financing is key. This includes working together to develop and implement policies that encourage investment in SMEs by venture capitalists and other potential sources of private sector funding.
Providing channels for the exchange of SME financing innovations and formulating a policy response that addresses related impediments outlined by firms within the sector will also be on the table.
Ministers will additionally focus on building SME management capability, entrepreneurship and innovation. This includes mobilizing practical support for new and emerging firms in the region through cross-border incubation, mentorship, early-stage investment and business matching.
The reduction of administrative red tape to make it easier, cheaper and faster to both start and grow a business as well as the promotion of SME business ethics, women entrepreneurship and intellectual property rights policies that encourage research and development are further priorities.
Through measures such as these, which are guided by input from the business community, who will participate in Nanjing, ministers will lay a foundation for more innovative development, economic reform and growth across the Asia-Pacific region.
These are themes that are at the heart of collaboration between APEC member economies during China’s year as APEC host. Their realization will be critical to unlocking the next generation of growth and economic opportunity for the region’s nearly 3 billion people.