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A Multi-Pronged Approach to Inclusive Growth for MSMEs

After 18 months of navigating the global pandemic, social distancing and periodic lockdowns are the new norms as vaccinations compete with emerging variants of COVID-19. This scenario is a stark contrast to the situation only 18 months ago, when the COVID-19 pandemic brought unprecedented economic and social challenges to economies around the world.

Micro, small and medium-sized enterprises (MSMEs) have experienced the brunt of the pandemic's impact, with businesses forced to close or drastically reduce their capacity. Government efforts toward inclusive, post-pandemic growth must prioritize MSMEs, which comprise 97 per cent of all businesses in the APEC region, and occupy a central role in their economies.

This policy brief will focus on how APEC economies can achieve a multi-pronged approach by discussing four thematic areas: digital entrepreneurship, MSME competitiveness and access to international markets, MSME growth and inclusive ecosystems, and innovation for micro-enterprises and startups. Drawing on Canadian best practices and on-the-ground research in Indonesia, Peru, the Philippines, and Vietnam through the APEC-Canada Growing Business Partnership, this policy brief highlights key actions and recommendations for the next stage of global recovery for MSMEs.

Key Recommendations:

  1. Implement policies and programs for advancing inclusive growth for MSMEs that address multiple areas of MSME development in co-ordination with various stakeholders in the MSME ecosystem, including but not limited to government, business associations, and entrepreneurs.
  2. Prioritize upskilling and opportunities in digital entrepreneurship that can give entrepreneurs more capacity to upscale, innovate, and expand to international markets.
  3. Ensure the robust collection of disaggregated MSME data to better understand the varied and diverse landscape of MSMEs and entrepreneurs in APEC economies.
  4. Target MSME policies and supports to the specific needs of different businesses and entrepreneurs.
  5. Implement long-term strategies to advance the inclusion of marginalized entrepreneurs including women, youth, Indigenous peoples, and rural-based entrepreneurs.