Mainstreaming SMEs into the Global Value Chain

The University of the Philippines Institute for Small-Scale Industries (UP ISSI) ventured into
assimilating small and medium enterprises (SMEs) into the global market as it
implemented the Asia Pacific Economic Cooperation (APEC) SME Business Matching and
Internship Consortium for Global Value Chain Integration Project (APEC GVC Project).
Realizing the bountiful opportunities available for small and medium enterprises (SMEs) to
be integrated into Global Value Chains (GVCs), UP ISSI conducted the APEC GVC Project
under the APEC SME Working Group. The Project aimed to: (1) jumpstart information
exchange and to identify the knowledge and capability gaps for SMEs in global value chains;
(2) create an SME Global Value Chain Business Matching and Internship Consortium in APEC
to foster cooperation and to spur information exchange among industry stakeholders MNCs, SME training providers, SME agencies, and industry champions; and, (3) develop an
online platform for easier communication and information exchange.
To attain these objectives, the
APEC GVC Project organized a
stakeholders consultation at
the UP ISSI (April 7) where
various stakeholders in the
Agriculture, Handicrafts, Food
Processing, Electronics and
Automobile industries discussed
their various concerns on how
to promote entrepreneurship; establish supply chains; promote business continuity, gain
access to shared service facilities, finance, and markets; and empower SMEs to expand and
address non-tariff barriers to trade.

An APEC Global Supply

Chain Event for SMEs was
likewise held at the
Georgia Tech Hotel and
Conference Center in
Atlanta, Georgia, the USA
on June 8-9, where the
Philippines hosted the
Workshop on APEC SME
Business Matching and Internship Consortium for Global Value Chain Integration. In this
workshop, speakers from notable
companies in APEC member economies
like UPS International, Ebay, FedEx,
Walmart, Jollibee, Echo Store, Me Trang
Coffee Corporation, among others,
shared their insights on how SMEs could
be integrated in the global value chain.
Other institutions like the US Bankers
Association for Finance and Trade,
Malaysia External Trade Development
Corporation, Michigan State University,
Georgia Institute of Technology, and
International Trade Center, also imparted
the latest business practices and
mechanisms for collaboration between
private sector, academic and training
institutions and the government.

The workshops enlightened

the participants on the
opportunities available for
SMEs
participation
in
global value chain which
include being suppliers of
raw materials and providers
of services, spare parts,
finished products, traded
items,
and
returnable
packaging. The workshops
highlighted as well the
need for SMEs to improve
the quality of products and
the need to acquire
certifications. However, a
number of long-standing
concerns also surfaced particularly product spoilage, regulatory compliance, product
security and managing supply chain costs, etc.
Significant
recommendations
that came out to
address
these
concerns involved
improving
the
quality of the
supply
chain
ecosystem
of
APEC economies
to
address
structural
and
institutional gaps and fostering partnerships between large corporations and government
institutions. Government, academic and training institutions were egged on to educate
SMEs and strengthen their incubator and accelerator programs, too.
Notable policy recommendations identified were (1) harmonization of minimum trade
regulations in the region; (2) optimization and harmonization of shipping and postal
regimes; (3) promotion of global electronic payment method, among others.
A consortium of corporations, SMES, training institutions, trade promotion organizations,
and business support organizations is being established in the APEC Region to sustain the

gains of the project and achieve the business matching and expansion of business
opportunities. It is hoped that it would evolve into a more solid group of champions
enhancing the capabilities of SMEs and facilitating trade and market access in the APEC
Region. This consortium will be featured in an online platform. Dubbed MSME Marketplace,
the online platform will consolidate trade and other related data from the 21 APEC
economies to foster networks and facilitate information exchange in the region. It will also
include trading platforms in the region that will enable SMEs to conduct B2B and B2C
transactions.

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