Philippine firms push for SME fund

THE Philippine Chamber of Commerce and Industry (PCCI) wants the government to set up a development fund to assist micro, small, and medium enterprises (SMEs) amid the recent typhoons and global economic crisis.

In a 12-page document issued during the 35th Philippine Business Conference, PCCI said the Development Fund should be exempted from the rules of the Bangko Sentral ng Pilipinas (BSP).

This among other resolutions will be presented to President Gloria Arroyo today.

The Department of Trade and Industry (DTI) said SMEs play a major role in the country’s economic development through their contribution in rural industrialization; creation of employment opportunities and more equitable income distribution; use of indigenous resources; earnings of foreign exchange (forex); creation of backward and forward linkages with existing industries; and entrepreneurial development.

In the last five years, the SME sector accounted for about 99.7 percent of the registered businesses in the country and employed 70 percent of the labor force. Around 30 percent of the total sales and value added in the manufacturing come from SMEs.

PCCI also wants local government units (LGUs) to include in their enterprise development program the conduct of information/education campaigns to encourage SMEs to register and avail of the incentives of the Barangay Micro Business Enterprise (BMBE) Law.

The group also wants to facilitate access to competitive financing from both government financial institutions and the private sector.

It said the Bureau of Internal Revenue (BIR) should also review Revenue Regulation 6- 2009 and clarify its coverage so it doesn’t tie down SMEs with penalties and surcharges for non-compliance with same.

The said regulation provides criteria defining which firms rank among the country’s top 20,000 and covered by limits on purchases that may be exempt from taxation.

To ensure food security, the government should allocate substantial resources to rehabilitate typhoon-affected areas and crops in Central and North Luzon as well as come up with measures to augment farmers’ incomes including the provision of agricultural production and post-harvest machineries to replace affected machineries, PCCI said.

The business group also listed priority projects for infrastructure, tourism and energy, as well as legislation for the President’s certification.

Among the projects that PCCI wants expedited include:

• LRT 1 South Extension;
• MRT 2 North and South Extension;
• Caticlan runway extension;
• North Luzon Extension Project to Pangasinan;
• Development of common-user provincial bus terminals at the ends of both MRT 7 in Bulacan and LRT 1 South in Cavite; and the
• Creation of an Energy Program Commission composed of the PCCI and a number of government agencies.

The PCCI also wants Congress to pass pending priority legislation, and the President to undertake measures to bring down the cost of operating the Ninoy Aquino International Airport.

For the medium- to long-term, the group recommended addressing infrastructure gaps critical to the development of the Subic-Clark-Batangas Logistics Corridor such as the North Luzon Expressway-South Luzon Expressway link, the Diosdado Macapagal International Airport Terminal 2 and a high-speed train from Clark to the Central Business Districts. –Darwin G. Amojelar, Senior Reporter, Manila Times