Date Published:
Jul 12, 2018
Discussion Papers
Focus Area(s):
DP 2018-07

Small and medium-sized enterprises (SMEs) are important in many developing countries, including the Philippines. However, this sector remains much less productive than their large counterparts. One factor that can help SMEs achieve higher productivity is to connect them to global value chains (GVCs) through internationalization. However, SMEs are faced with a host of obstacles in trying to participate in GVCs. This paper attempts to determine the challenges and enablers of connecting small and medium businesses to GVCs. It uses data from a survey of Metro Manila SMEs and a set of key informant interviews of SME owners and of government officials tasked to assist SMEs. Findings show that Philippine SMEs are weakly linked to GVCs. The challenges and enablers can be grouped into five themes, namely: (1) competition in ASEAN and East Asia; 2) international standards, regulatory requirements, and local institutions; (3) role of the government; (4) international market demand and inputs supply; and (5) entrepreneurial mindset. Based on the results, some policy implications were formulated.


This publication has been cited 8 times

In the Media
  1. Bankero. 2022. BPI, Bayan Academy launch program for micro, small enterprises. Bankero.
  2. Desiderio, Louella. 2022. BPI Foundation launches program to help MSMEs. Philippine Star.
  3. Ibañez, Jenina. 2019. Tiny proportion of small firms linked to global supply chain – PIDS. BusinessWorld.
  4. Katigbak, Jovito Jose. 2020. Enhancing trade facilitation through ICT: progress and roadblocks for the Philippines. Journal of International Affairs.
  5. Manila Bulletin. 2019. MSMEs: The lifeblood of PH economy. Manila Bulletin.
  6. Manila Standard Business. 2019. MSMEs: Lifeblood of PH economy. Manila Standard Today.
  7. Philippine Information Agency. 2018. Local SMEs need more gov’t support to go global, study says. Philippine Information Agency.
  8. Team Orange. 2022. BPI SEAL empowers micro and small enterprises for sustainable growth. Team Orange.

Main Menu

Secondary Menu