Small and medium enterprise development

The Ministry of Trade and Industry (MTI) will implement the project"s institution building, policy research, and microenterprise development activities. Institution building activities will focus on Philippine Regions I (Ilocos), II (Cagayan Valley), V (Bicol), VI (Western Visayas), and XII (Central Mindanao). An international consortium and MTI will work with the Philippine Chamber of Commerce and Industry (PCCI) to organize new, primarily regional, SME associations and strengthen existing associations. Focusing on the garment, handicraft, and wood furniture subsectors, the consortium and MTI will also help industry and service associations to provide SME"s with extension services, e.g., newsletter publications, trade fairs, market contact programs, association needs analysis, and demonstration activities in finance, marketing, technology, and management. The project will also finance workshops, seminars, and other training for MTI and association personnel, and will develop mechanisms to engage SME"s in policy dialogue with the public sector. Some 43 regional associations are expected to participate. Project activities in policy research will include: commissioned studies on SME"s; applied research on employment and enterprise issues; workshops/seminars to disseminate research results and analyze policies; and long and short-term training in business, law, development, and organizational areas. Finally, to enable indigenous PVO"s and other private entities to support microenterprises outside of Manila, the project will provide funds to establish sustainable credit programs. MTI"s Micro Industries Development Program will provide TA, workshops, and seminars to upgrade PVO extension services in the areas of basic accounting, quality control, and marketing. Amendment of 9/15/88 authorizes Phase II, reducing funding by $8 million. Phase II will: (1) modify geographic targets, dropping Region II and adding IV (Central Tagalog and Palawan) and XI (Southern Mindanao), and SME targets, dropping furniture and adding metalworking and food processing; (2) replace the institution building component with integrated sector support, which will provide TA to firms and associations, technical training, market development services, and regional common service facilities; (3) implement the research component (not implemented in Phase I); and (4) replace microenterprise development (also not implemented) with support to the GOP"s People"s Economic Councils, grassroots organizations fathered by the 1986 revolution. (PD-AAY-255)