Eps 1576: the future of Micro SME

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Anne Williams

Anne Williams

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The European Commission has published a primer on Human Rights for Small and Medium-sized Enterprises , drawing from the United Nations Guiding Principles on Business and Human Rights. Human Rights for Small and Medium-sized Enterprises . Support to small and medium enterprises regarding business and human rights SMEs are an essential part of the Japanese economy, providing most jobs and contributing to the lives of local communities and residents, being a critical actor in the community, as well as playing a role in the supply chain. There is no mention of Small and Medium Enterprises in the chapter on Business and Human Rights of Georgias NAP on human rights. Small and medium enterprises are generally defined as those that have an annual turnover up to approximately $50 million, or employ as many as 250 workers.
In Europe, 99.8 percent of all firms are SMEs, with SMEs providing 65 percent of jobs. According to an analysis by the McKinsey Global Institute, while midmarket businesses account for just 2% of all firms, they contribute around 30% to GDP and jobs in most countries. Small businesses make up over 70 percent of firms and over 50 percent of jobs globally.
Formal and informal MSMEs account for more than 90 percent of firms globally, accounting for 70 percent of total employment and as much as 50 percent of the worlds GDP, according to U.N. estimates. As for micro-SMEs, between 83 per cent and 86 per cent of the 150,000 enterprises are involved in the trade in crafts and micro-production, 9 per cent, or 20,000 enterprises, are in the manufacturing sector of small and medium-sized enterprises, while fewer than one per cent are manufacturers of medium-sized enterprises. Businesses under the MSME segment are also plagued by the lack of growth: more than 99 percent of companies under the MSME sector fall into micro categories, 0.5 percent fall into the small category, and 0.007 percent fall into medium categories.
Many of the small firms are younger enterprises, which, combined with their smaller size, makes them weaker competitors to many of the standard market players, not just for funding access, but for customers, who may view smaller suppliers as being too risky. When enabled by business-friendly environments and open markets, larger firms may flourish; in the meantime, SMEs have a wide array of unmet needs.
Looking forward, a healthy SME sector is essential to economic revival in African countries, where small and medium-sized enterprises typically account for over 90% of all businesses, contributing substantially to inclusive economic growth. If we are successful in making sure the 44 million micro-enterprises are successful, then we have the basis for an economic recovery which could spur sustained, inclusive growth across Africa. Sustainable social and economic development over the coming years will be dependent on efforts to forge networks and partnerships among the large business players and the innumerable micro, small, and medium-sized enterprises around the world.
By equipping small and medium-sized businesses with digital payments solutions, data, and insights to operate their businesses more effectively and safely, MasterCard is committed to helping entrepreneurs across the globe not just rebuild, but also grow and prosper. As a technology company, Mastercard is deeply passionate about innovation, as well as new and exciting ways to grow the digital economy -- because this is where growth happens -- particularly for small businesses and micro-enterprises. Mastercard is working very closely with governments, financial organizations, fintechs, and the wider business community to build opportunities for SMEs in sub-Saharan Africa alone.
In Ethiopia and Guinea, World Bank Groups supports the local governments to establish a favorable environment conducive to launching and growing leasing operations, and attracting investors, in order to improve access to financing for SMEs. Given the challenges facing SMEs, and the scale of opportunities, most of the G-20 countries have established national institutions that are wholly or predominantly aimed at supporting their growth.
Governments, advocates, and various agencies and institutions provide outside support for SMEs in order to preserve their lives, promote their growth, spur innovation, and strengthen their capabilities through increased management capacity and improved marketing skills, thus ensuring that they contribute more entrepreneurially to national economies . For instance, UK-based charity Be The Business has developed an online self-assessment platform, which is open to all SMEs and is designed to help them to enhance the effectiveness of all SMEs. Priority will be given to initiatives which facilitate training in business due diligence, or which are developing practical and effective human rights tools for SMEs.
Measure 8 The monitoring commission shall design and present a proposal for the adoption in Colombia of a reward system involving both big companies and small and medium-sized enterprises implementing policies on human rights. Because SMEs comprise a broad spectrum of companies, as measured by size, industry, and type of activity, the government will carry out efforts on trade and human rights with the participation of SMEs, reflecting the diversity of these enterprises. With almost 10 million SMEs contributing 23% to the GDP, 80% of jobs in industry sectors, and 25% to total employment, the SMEs finance policy will play a key role in strengthening SMEs funding.
The story is different in Thailand, where small businesses thrive thanks to an extensive network of supports, with SMEs receiving publicity assistance from government and associations. Laim Kimleng, deputy secretary at the Handicrafts and Industry Ministry, said that the majority of small businesses in Cambodia are family-owned businesses that do not have proper accounting.
Small businesses provide essential needs, jobs, and social cohesion, particularly in rural areas. Basically, SMEs are multifunctional tools, offering one place where an individual can conduct various trade transactions, ranging from hailing taxis and buying groceries, paying the electric bill--or applying for credit, a feature particularly helpful for micro-enterprises and micro-businesses. Within a single industry, or across countries of similar sizes, there may be a two-to-one or greater difference in productivity levels between larger firms and SMEs.