70% of MSMEs set to restart — PCCI

Published June 14, 2020, 12:00 AM

by manilabulletin_admin


The Philippine Chamber of Commerce and Industry (PCCI) said at least 60-70 percent of micro, small and medium enterprises (MSMEs) which are eager to restart operations are in dire need of financial support from the government to sustain their operations.

PCCI President, Amb. Benedicto Yujuico
PCCI President, Amb. Benedicto Yujuico

PCCI President Benedicto V. Yujuico said this was based on his initial conversation with the chamber’s regional vice presidents. PCCI is also completing a survey on the readiness of its members to resume business. PCCI has roughly 35,000 members across the country, largely MSMEs.

As such, Yujuico has appealed to the legislative and executive branches of government to work together to pass the economic stimulus package bill Accelerated Recovery and Investments Stimulus for the Economy (ARISE) and the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) saying these are needed for businesses in the country to restart their operations and rehire workers.

He also appealed for banks and financial institutions to take it easy on the loans of MSMEs by extending maturities or restructuring of debts.

“At this time, businesses still have enough money to restart their businesses. What they are concerned about is how they will be able to sustain their operations,” he said adding MSMEs need the assurance that the banking sector will be able to help them via extending maturities of loans, interest payments and additional working capital.

“If the banking industry will not actively engage in assisting MSMEs then more businesses will shut down and lay off employees, in other words, just give up.”

Yujuico credited the Bangko Sentral ng Pilipinas for its full support to the MSMEs by allowing loans to MSMEs to be counted as bank reserves, meaning banks can rediscount these loans. “The problem is that financial institutions are not cascading this assistance to the MSMEs,” he lamented.

With that Yujuico said urged for sufficient incentives or effective sanctions if banks do not follow BSP’s directive because “for the most part, banks don’t follow, they rather just pay the penalties for not complying.”

“The key to obtaining relief for our members is for the BSP to encourage and help banks to be able to support the businesses and industries hardest hit by the pandemic.”

Reiterating the PCCI and the entire business community’s support to the ARISE’s provision to extend loan terms for a period of one to two years, Yujuico urged the banking sector to provide businesses more breathing room to help support trade and industry survive the pandemic.

“We are calling on the banks to review their guidelines with a request to align with the ARISE to allow longer payment extensions so that they can respond appropriately to the big negative impact of the pandemic on many borrowers,” Yujuico said.

Stressing that these are the same companies providing a steady stream of revenue during the good times, Yujuico appealed to the banks and other financing institutions to help revive businesses and get the Philippine economy to move forward.

During the lockdown, many member companies of the PCCI were unable to generate enough revenues to service their debts to banks. The willingness of bank to restructure loan, Yujuico said, will breathe life back into businesses and preserve employment.