World news – More help for MSMEs should prevent permanent closure

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UNCERTAINTY. With the ongoing coronavirus pandemic, a newly discovered strain of Covid-19 in other parts of the world, and the lack of economic aid and incentives, micro, small and medium-sized enterprises (MSMEs) are at risk of permanent closure. If the economy does not recover from this year onwards, many will lose their jobs and many MSMEs will not make it until the end of the year. (SunStar file)

More jobs are expected if the Philippine economy does not recover from this year: « We expect 30 percent of micro, small and medium-sized enterprises to be permanently closed or downsized, which means more unemployment, » said Steven, President of Commerce and Mandaue Yu Chamber of Commerce told SunStar Cebu. « We will be relying on government spending as the main source of funding for the pump, in addition to overseas Filipino remittances, business process management, and possibly mining. »

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Yu said, while the economy can withstand any bruise, it may take longer than expected to recover. « We are looking to 2022-2023 to reach pre-pandemic levels, » he said, adding that the planned time span could be a long wait for others due to weak market sentiment, lower consumer spending activity and the like With a lack of economic help and impetus, they already have problems every day. Data from the Department of Commerce and Industry showed that there were around 70,227 MSMEs in Central Visayas in 2019. Earlier this week, Moody’s Analytics reported that the Philippines will be the last country in the Asia-Pacific region to recover from the recession caused by the Covid-19 pandemic. Steven Cochrane, Moody’s Analytics chief economist for Asia Pacific said that “much of the region will do so by the end of 2021, all of the Philippines will have regained their lost production. « The Philippines, along with India, » will have difficulty reaching this benchmark by the end of 2022. “India and the Philippines will struggle with deep recessions because of their manufacturing and the uncertain fiscal support of their policymakers,” said the economist from Moody’s Analytics End Among Asian Countries. « This also includes being consumer-driven as an economy and the length of our lockdown, which is one of the longest in Asia, » he said. The Philippines lagged behind its counterparts in the Asia-Pacific pandemic on budgetary response. As of Nov. 30, only $ 21.64 billion was allocated to fighting the pandemic, as opposed to Indonesia’s $ 116.33 billion Covid-19 response package and Singapore’s $ 89.14 billion. Cochrane said the Philippines and India are « the least liable to fiscal stimulus, despite being the toughest economies have been hit by the pandemic and lengthy and stringent quarantine policies. » « According to the latest updates, the Philippines are likely to be the final vaccinations compared to other countries like Indonesia, which are expected to start in January » While our macro fundamentals are solid and our finance team is impressive, we are lagging behind on the health aspect, since our cases are already subdued. The stimulus spending problem is related to our rating problem. We have limitations because of our structure, ”he said. The Development Budget Coordinating Committee expects the country to grow 6.5 to 7.5 percent in 2021 and between eight and 10 percent in 2022. (JOB)

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