Strengthening the dynamics of micro, small, and medium enterprises (MSMEs) with innovation and internationalization will be key to revitalizing Southeast Asian economies devastated by the COVID-19 pandemic - Photo: Special

JAKARTA (TheInsiderStories) – Strengthening the dynamics of micro, small, and medium enterprises (MSMEs) with innovation and internationalization will be key to revitalizing Southeast Asian economies devastated by the COVID-19 pandemic, according to a new report from the Asian Development Bank (ADB).

It said, MSMEs are a critical driving force in Southeast Asian economies, accounting for an average of 97 percent of all enterprises and 69 percent of the national labor force from 2010 to 2019. They contributed an average of 41 percent of each country’ gross domestic product (GDP) over the same period.

MSMEs in Southeast Asian economies mainly focus on domestic markets and their level of entrepreneurship remain suboptimal. Supporting the development of MSMEs, particularly in technology adoption and participation in global supply chains, will contribute to inclusive growth and aid in recovery efforts from COVID-19,” said ADB Chief Economist Yasuyuki Sawada, today (10/22).

While, ADB President, Masatsugu Asakawa, urged Southeast Asian (ASEAN) countries to expand investments in digital infrastructure and ensure equitable access to technology as economies recover from pandemic.

“We must close the digital divide and expand existing investments in digital infrastructure by building more and higher quality mobile broadband infrastructure and ensuring affordable internet access and coverage,” he said in in an official statement.

He highlighted five key policy areas that can support developing economies in Southeast Asia as they return to a path of sustainable growth. First, address regional disparities and ensure more equitable access to technology, including an expansion of investments in digital infrastructure to close the “digital divide”, while addressing cyber security.

Second, facilitate a green and resilient recovery by promoting investments that drive economic activity toward low-carbon and resilient practices. Third, strengthen regional cooperation and integration by improving cross-border digital connectivity, e-customs systems, and electronic cargo tracking systems.

Fourth, deepen institutional capacity for mobilizing domestic resources to finance public services, while ensuring debt sustainability. And fifth, incubate, develop, and congregate small and medium-sized enterprises with entrepreneurship and technology, supported by an aggregated financial, academic, and business ecosystem to help set the stage for tech-based growth.

Written by Editorial Staff, Email: theinsiderstories@gmail.com