The United Nations has said that micro, small and medium-sized enterprises (MSMEs) can expand their businesses while creating new products for new markets as they try to diversify in order to seize various opportunities and survive the pandemic.
According to Jezreel Joy Eufemio-Cristobal, representative of the United Nations Industrial Development Organization and the Office of the Philippines (UNIDO), the importance for MSMEs to take advantage of economic diversification must be emphasized and emphasized.
“There are countries that depend on the production and export of low-end products and services. There are also those that sell products in only a few overseas markets that have found themselves growing at a slower pace” , she pointed out in a webinar. “All of this is due to the low rate of diversification which leads to missed opportunities, especially in the global market. It also leads to unnecessary domestic competition caused by similar operating businesses in limited business space.”
Additionally, Eufemio-Cristobal said companies that have the ability to diversify their operations also result in greater resilience to economic shocks, such as that caused by the Covid-19 pandemic.
“Economic diversification will be essential for countries to emerge from the pandemic and take advantage of growth opportunities. It can help prepare countries to deal with potential future global and local headwinds, leading to greater resilience to socio-economic shocks,” she added.
Eufemio-Cristobal also said diversification aims to shift the economy from a single source of income to multiple sources from a growing range of sectors and markets.
As part of efforts to diversify the Philippine economy, she said the country can look to the manufacturing sector as there is great potential for increased export activity.
In particular, she cited agro-industrial industries which can create options and flexibility in business operations and enable greater participation of MSMEs in various global value chains.
“With this in mind, the country must also strengthen its quality infrastructure, facilitate the adoption of standards and access to state-of-the-art testing laboratories, especially for MSMEs,” she added.
Besides economic diversification, Eufemio-Cristobal also highlighted opportunities for MSMEs in the green economy and sustainable finance.
She said green economy and sustainable finance accelerate the adoption of green, circular and climate-smart approaches in MSME operations and involve investment decisions that consider environmental, social and governance factors. .