SMEs key to sustainable economic growth: ITC

KARACHI: To ensure sustainable economic development, it is essential to support and work closely with the Small and Medium Enterprises (SMEs), as SMEs cover 70 per cent economic activities and a major source of job creation globally, experts said.

Speaking at GRASP-KCCI stakeholders’ engagement workshop, organised at the Karachi Chamber of Commerce and Industry (KCCI), on Tuesday, International Trade Center (ITC) Chief of Sector and Enterprise Competitiveness Robert Skidmore said that the ITCs Growth for Rural Advancement and Sustainable Programme (GRASP), funded by the European Union, has been designed to strengthen SMEs associated with the livestock, dairy and horticulture in Sindh and Balochistan by focusing on financing, human resource, environment, quality, packaging and all those things fundamental to SMEs.

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GRASP focuses on what markets, buyers and consumers want. It then equips producers and SMEs with skills, technology and services needed, he said, adding that the programme provides producers with targeted services, such as access to market information, credit and training.

It also supports companies in processing commodities in the value-added goods, adopting better technology and building efficient and inclusive supply chains.

He said the ITC’s job was to work closely with the SMEs across the world and every year, it works with around 25,000 to 30,000 small companies around the world.

“We measure our success based on your success. We are here at [the] KCCI to listen to and understand the problems [being] faced by the SMEs so that we can help. We work closely with [the] organisations like KCCI to improve the environment around SMEs and to give them support,” the ITC’s chief said.

“We try to open up markets and create opportunities for [the] companies by linking them with buyers and by helping them to adapt products and services. We work in three areas, including compete, connect and change. Our job is to make small companies become resilient so that they are ready to compete even during the crisis triggered either by pandemics like Covid-19 or any environmental change,” he added.

Earlier, Vohra appreciated all the efforts being made by the ITC through its GRASP project in Sindh and Balochistan where a large number of SMEs exist and require such assistance.

The contribution of SMEs in the economic development has been great but these SMEs face a number of challenges, of which the most important one is the majority of the SMEs in Sindh and also the rest of Pakistan are undocumented, he added.

“This keeps the SMEs away from access to finance by banks whose 70 per cent financing is usually given to the government, whereas the remaining 30 per cent is taken away by big corporations, while the SMEs remain deprived mainly because of being undocumented. It is a very important area where [the] ITC’s GRASP project must particularly focus,” he said.

There was a time when a few dedicated development finance institutions (DFIs) were operational, which provided loans to the agricultural sector and the SMEs but they disappeared with the passage of time, which was another key reason for limited or no financing facility for the SME sector.

He said a paradigm shift was being witnessed in Pakistan, as several urban businesses have now started investing in the livestock and agricultural sector, as well, making it easier for the ITC and other agencies to approach them from platforms such as the KCCI, as they already hold membership of the chamber.

Vohra also extended full support and cooperation to the ITC for making its GRASP project successful, which would help alleviate poverty and prove prosperous for the country’s economy.