SMEs potential cited in alleviating poverty

Small and medium enterprises (SMEs) can be a key in alleviating poverty in the country, Trade and Industry Secretary Cesar V. Purisima stressed.

He cited that since the bulk or almost 99 percent of Philippine industries consist of SMEs, the sector can contribute about $25 billion to gross domestic product (GDP) annually and lift the living conditions of the country’s lowest income strata comprising 35 percent of the population.

The key sectors in which the SMEs should concentrate, Purisima said, are agriculture and fisheries, mining and services, particularly retail trade.

According to Purisima, in order to double the daily income of the 35 million Filipinos who earn an average of $2 a day or lower, the economy has to raise $25 billion over the next six years.

To be able to do so, the domestic economy should be able to post a sustained growth of 7.3 percent over the next six years.

Last year, Purisima said Philippine food exports amounted to $1.319 billion, thus could also be considered a potential growth driver.

The mining sector also has vast potential, although it needs to be opened up to foreign investors who can provide the intensive capital and technology needed, Purisima pointed out.

The services sector, on the other hand, has huge potential for employment especially in the information and communication technology (ICT) sector such as the outsourcing and call center industries.