Ecuador micro-enterprise sector assessment : summary report

There are an estimated 250,000-300,000 MSE"s in the country. While the majority are unregistered, informal sector enterprises, a substantial number are either registered businesses or in various stages of formalization. Together, these firms provide jobs to 750,000 to 1 million people. This study examines the characteristics of small-scale enterprises in Ecuador; analyzes the potential for growth and expansion in the sector; assesses the effectiveness, coverage, and adequacy of MSE support services; and recommends strategic options to improve support for MSE development. The firms studied have 1-12 employees, and 75% have less than $5,000 in total assets. The report concludes that the ability of the MSE sector to continue to thrive will require the resolution of three major problems: (1) the lack of access to financial resources; (2) the lack of access to other effective support services designed to overcome weaknesses in management, technology, and marketing; and (3) Ecuador"s negative business climate.