ADB opens program for SMEs

The Asian Development Bank (ADB) has a $400,000 technical assistance funding for the development of the small and medium enterprises (SMEs) in the Philippines.

Also involved in the financing and implementation of the SME program as executing agencies are the Department of Finance (DOF) and the Department of Trade and Industry (DTI).

The program started in July this year and it should have been completed by December 2003. It is part of the overall thrust of the ADB towards poverty alleviation.

The $400,000 technical assistance should be able to provide the necessary inputs for a joint formulation of the proposed ensuing project. The project for the development of the SME sector would involve the Small Business Guarantee and Finance Corp. (SB Corporation), government and private financial institutions, SMEs, business chambers and donors, and the departments of finance and trade.

It should likewise be based on in-depth analysis of the existing credit and credit supplemention schemes, the constraints to the SME financing and a survey on demand of SME financing.

The SME funding is part of the ADB’s 15-year strategy worth billions of US dollars designed to eradicate poverty in the Asian region with emphasis on selective investments, environmentally-friendly programs, and greater private sector participation.

The program is outlined in its long-term strategic framework (LTSF), a major reassessment of ADB’s goals and policies that two years ago resulted in the realization that extreme poverty for one in four Asian was "an unacceptable human condition."

"ADB has chosen a 15-year timeframe, because it correlates with its framework integrated its new strategy with the International Development Goals (IDGs), seven broad benchmarks for reducing poverty worldwide by 2015 resulting from a series of United Nations-sponsored world conferences during the past decade.

The ADB made it clear that they would need the cooperation of other international institutions, governments of clients states, and their respective private sectors.

"The development challenges of the region are far beyond the capacities of any one institution," the global financial institution said. "The LTSF will enable us to be selective in our investments and to take a long-term approach to focus our resources on the things we do best, and to be more efficient in our operations."

The IDGs are: (a) to reduce the incidence of extreme poverty by half between 1990 and 2015; (b) achieve 100 percent primary school enrolment by 2015; (c) eliminate gender disparities in primary and secondary education by 2005; (d) reduce infant and child mortality by two thirds between 1990 and 2015;

(e) reduce maternal mortality ratios by three quarters between 1990 and 2015; (f) expand access to reproductive health services to all women by 2015; and (g) implement in all countries a national sustainable development strategy by 2005 and to reverse the loss of environmental resources by 2015.