The COVID-19 pandemic spotlights how unsustainable models of production and consumption have resulted in health, economic, and social crisis of a global scale.
As the pandemic continues to disrupt economies and lives, a recovery pathway anchored on sustainable development is imperative.
The big question is, how?
Society’s collective response to enable among the worst-hit sectors of the economy – the MSMEs – to build back better and with greater resilience must be front and center in the COVID-19 economic recovery agenda.
On 5th November 2020, the Global Compact Network Philippines in partnership with the United Nations Industrial Development Organization (UNIDO Philippines) will be hosting the Sustainability Summit 2020. This year’s summit, which will be delivered virtually, is rightly focused on “Uniting Business to Support MSME Recovery and Resilience.”
According to the National Economic and Development Authority (NEDA) the pandemic has forced more than 60 per cent of MSMEs in the Philippines to stop operations. Nearly one in three businesses that support mostly small farmers, women, and micro-entrepreneurs saw zero revenue at the height of the pandemic.
Another UNIDO assessment report, conducted in May 2020 at the height of the enhanced community quarantine (ECQ), revealed the challenges and effects of the pandemic and containment measures towards MSME operations.
The report summarised that challenges during the ECQ revolved around supply-chain issues, human resources, and business continuity management. It also surfaced impediments to recovery, mostly expressed as challenges in cashflow, health/safety of workers, and decline in demand.
The report also analysed that 55 per cent of microenterprises experienced more than 40 per cent loss of employment. For firms that were able to continue operations, about 50 per cent experienced a 40 per cent reduction in operating hours, resulting in 60 per cent reduction in both revenues and production volume.
To stay afloat, most MSMEs are now compelled to take out loans from development finance institutions (DFIs) and other sources; and to access industry revitalisation programs offered by the government, available stimulus packages, and possible deferrals in tax obligations and other payments.
As the economy is confronted with a need for a great reset, there is a ripe opportunity to do so while embedding sustainable development and aiming for long-term resilience, as promoted in UNIDO’s mandate of inclusive and sustainable industrial development.
How can emerging financing mechanisms be tapped effectively for the Philippines’ sustainable recovery from COVID-19? What appetite are MSMEs demonstrating to pivot toward sustainable business practices, and how can big corporations lend support to enable this new trajectory?
What role does the digital ecosystem play in making advanced disruptive technologies, e-commerce practices, and quality/safety standards accessible to advance recovery for MSMEs, the major drivers of the Philippines’ economic growth?
This year’s Summit will stage the outcome reports from three days of high-level, multi-stakeholder Business Expert Group Meetings which GCNP and UNIDO organized in October in the lead-up to the Summit. The main objectives are to present an actionable policy recommendation, synthesised from notable industry players; and, harness commitments from policy and business leaders – the two sectors most capable of sustained action – to support MSME recovery pathways anchored on the pillars of People, Planet, Prosperity, Peace and Partnerships, consistent with the Philippine Socio-Economic and Peace Building Framework, to be agreed between the United Nations and the Government of the Philippines.
As the pandemic continues to unravel, the conversations and synergies to be harnessed at the Sustainability Summit 2020 hope to provide a lens through which to see pragmatic solutions that not only seek to rebuild the economy, but to do so while putting environmental and social stewardship in the front seat.
Join the robust discussions ahead. Register to the Global Compact Network Philippines and the UNIDO Philippines Sustainability Summit 2020!