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Small and Medium Enterprises (SMEs) in ASEAN

With the establishment of the ASEAN Community by the end of 2015, ASEAN has seen great interest and confidence in the prospects and opportunities for businesses, both big and small, in the region.  Small and medium enterprises (SMEs), as a key driver and contributor to the GDP of ASEAN economies, account for more than 95-99% of all business establishments, generated between 51 and 97% of employment in many AMSs. The contribution of SMEs to GDP is generally significant, about 23-58 per cent, and contribution to exports ranges from 10-30 per cent. They also enabled greater integration of women and youth into the economy.

ASEAN recognises the need to link SMEs, vertically and horizontally, with enterprises, traders, suppliers, manufacturers and consumers within ASEAN member states (AMS) and trade partners so that, by enhancing their market access and paving the way for their internationalisation, SMEs are able to take advantage of the trade and investment opportunities and benefits from regional economic integration.

In ASEAN, cooperation on SME development began way back in 1995, when fostering SME development became one of the priority areas in respect of policy focus and resources. The ASEAN SME Agencies Working Group (SMEWG), which comprises representatives from ASEAN SME agencies, was formed to formulate policies, programmes and spearhead the implementation of flagship initiatives and projects for SME development and cooperation in the region. The SMEWG serves as a consultative and coordination forum to ensure the development of SMEs under the on-going process of ASEAN integration and support the establishment of the ASEAN Economic Community.

Regional cooperation on SMEs is approaching the final term of the Strategic Action Plan for SME Development (2010-2015) or SAP SMED.  Some of the flagship deliverables under the current Plan include (i) ASEAN SME Policy Index -- to assess and monitor policy and regulatory framework conducive for SMEs in ASEAN; (ii) ASEAN SME Service Web Portal with regional linkages, providing information crucial for SMEs to penetrate regional and international markets; (iii) ASEAN SME Online Academy – as a self-paced e-learning platform for SMEs;  (iv)  ASEAN Guidelines on One Village One Product (OVOP) to transform local/ rural products to the competitive products for export markets; and (v) Common Curriculum for Entrepreneurship in ASEAN – to nurture entrepreneurship into academic institute at an early level.

To ensure that ASEAN shall be globally competitive and innovative by the year 2025, the Post-2015 Strategic Action Plan is being crafted with the aims to (i) promote productivity, technology and innovation; (ii) increase access to finance; (iii) enhance market access and internationlisation; (iv) enhance policy and regulatory environment; and (v) promote entrepreneurship and human capital development.  

Recognising that access to information is crucial for market access and internationalisation of SMEs, a series of SME publications and directory has been published yearly. Most recently, the Directory of Outstanding SMEs in ASEAN 2015, listing over 800 SMEs in ASEAN priority integration sectors (PIS), was launched to complement the publications on innovative and outstanding SMEs and SME Guidebook towards the AEC 2015.The Directory included SMEs who have achieved notable success in their various fields after overcoming difficulties, embracing opportunity to sustain their business growth. A soft copy of the publication is available for download from:   http://www.asean.org/resources/publications/asean-publications.

Engagements with the Private Sector

ASEAN SME Advisory Board The ASEAN SME Advisory Board was established since 2011 to provide strategic policy inputs on SME development to the Ministers and guidance on high-priority matters to the ASEAN SMEWG. Board members comprise the Head of SME Agencies (DG level) from all AMS, and at least one representative of prominent SME leader from the private sector   

ASEAN Business Advisory Council (ASEAN-BAC) Regular meeting and consultation were held between ASEAN SMEWG and Japan.  Besides, SMEWG has been collaborating with ASEAN-BAC in promoting and nominating SMEs, particularly those young, innovative and women entrepreneurs, for the ASEAN Business Award (ABA).

Public Private Dialogue (PPD) for Drafting the Post-2015 SME Vision in November 2015. The PPD was participated by nearly 100 delegates from SME agencies, relevant policy makers, central banks, business chambers and SME associations in ASEAN member states, dialogue and development partners and think-tanks.

Participation at Regional and International Trade Expo, Fairs, Conference To showcase and promote SMEs’ products, services and investment opportunities. The key events include, among others, ASEAN SME Showcase and Conference in May 2015 and the annual China-ASEAN Expo (CAEXPO) and China-ASEAN Business & Investment Summit (CABIS).


ASEAN Strategic Action Plan for SME Development (2016-2025) or SAP SMED 2025

In preparation for the AEC Post-2015, the SMEWG with support from Japan, are in the process of finalising ASEAN Strategic Action Plan for SME Development (2016-2025) or Post-2015 SAP SMED. A Public Private Dialogue for the Post-2015 SAP SMED was held on 24 November 2014, at the sideline of the 36th SMEWG Meeting in Siem Reap, Cambodia. The dialogue reaffirmed the SMEWG’s key elements to the Post-2015 SAP SMED as follow:

  • Vision: “Globally Competitive and Innovative SMEs”
  • Mission Statement: “To create globally competitive, resilient and innovative SMEs seamlessly integrated into the ASEAN community for inclusive growth and sustainable development in the region”
  • Supporting Elements: (i) vibrant; (ii) resilient and innovative;  (iii) well-positioned to take advantage of the AEC;  (iv) seamlessly integrate into ASEAN community; and (v) sustainable growth and equitable development of the region.
  • Strategic Goals:
    • Promote Productivity, Technology and Innovation
    • Increase Access to Finance
    • Enhance Market Access and Internationalisation
    • Enhance Policy and Regulatory Environment
    • Promote Entrepreneurship and Human Capital Development
The SAP SMED 2025 is scheduled for launching at the ASEAN Business & Investment Summit 2015 in November, Kuala Lumpur, Malaysia.