Development News Edition
Give Feedback

ADB workshop to take stock of challenges faced by SMEs in landlocked economies

Small and medium-sized enterprises (SMEs) are particularly important for countries in transition.

ADB 14 Jun 2018, 06:06 PM China
  • SMEs are the backbone of economic activity in Asia and the Pacific. (Image Credit: Twitter)

ADBI-ADB-CI Inception Workshop: Leveraging SME Finance through Value Chains in the CAREC Landlocked Economies on June 21 in Beijing, People’s Republic of China.

Small and medium-sized enterprises (SMEs) are particularly important for countries in transition, facilitating the shift from mass production to demand-driven and market-oriented economies. 

SMEs are the backbone of economic activity in Asia and the Pacific, and critical to sustaining inclusive economic growth and social development. More than 96 percent of all enterprises in the region are SMEs, which account for about 42 percent of total GDP and employ 62 percent of the workforce.

SMEs in the Central Asia Regional Economic Cooperation (CAREC) countries, especially in the former Soviet Union states, face peculiar challenges where the private sector is still in the initial stage of development. Stronger SMEs can foster private enterprise, innovation, market development, employment, and economic diversification, and induce efficient allocation of scarce resources.

By joining global value chains, SMEs can contribute to development in the CAREC landlocked economies. SMEs, especially in agri-business in the CAREC region, can help diversify the production base, create jobs, reduce poverty, and ensure regional food security.

Linking regional agriculture value chains in sparsely populated cities and distant markets will not only improve market shares and cash flow projections but also offer better access to finance.

  • Take stock of the challenges faced by SMEs in the CAREC landlocked economies in terms of their access to finance in view of the abovementioned constraints. This includes identifying cultural, procedural, institutional, and regulatory incentives, disincentives, and barriers to finance, and the reasons for rejection of such access.
  • Assess opportunities of SMEs to link with domestic and global value chains and the potential impact of this on their access to finance.
  • Recommend policies to improve SMEs’ access to finance and trade finance, especially in agri-business, in light of best global practices, including the PRC’s program to nurture and support SMEs with regard to effective regulatory framework; access to finance (banks, capital markets, start-up finance and non-traditional micro-lending or community lending, risk capital); special programs funded by foreign donor institutions; guarantee schemes; improving skills (entrepreneurial training); encouraging networking among SMEs; and use of information and communication technology.
  • Transmit research management experience from ADBI to CAREC Institute (CI), by (i) demonstrating to CI ADBI’s system for planning, implementing, monitoring, and evaluating research activities, including how its research management group is structured; and (ii) providing CI with ADBI’s proposal template and standards and guidelines for reviewing proposals.

add banner