Senator Juan Edgardo “Sonny” Angara on Sunday called on micro, small and medium enterprises (MSMEs) to move towards digitalization in order to increase economic activity this year and provide a much-need boost to the Philippine economy.

Angara, Senate Finance Committee chair said, that while the economy is expected to rebound after a historic slump last year, growth is still expected to remain slow as movement restrictions remain in place and the rollout of the COVID-19 vaccination has yet to begin.

To offset the economic downturn, the senator said the government should boost its programs aimed at helping MSMEs move towards e-commerce.

“We want to see more economic activity this year but we still have to remain cautious as we are seeing a lot of new COVID-19 cases, as well as the new B117 variant of the coronavirus,” Angara said in a statement.

“Easing of restrictions will not happen right away so we have to continue making adjustments to thrive under the new normal,” he further said.

The National Economic and Development Authority (NEDA) earlier reported that the full year GDP figures for 2020 saw a contraction of the economy by 9.5 percent attributing the slump to the lockdowns imposed after the COVID-19 outbreak in the country early last year.

State economic managers, however, expect to see a growth rate of 6.5 percent to 7.5 percent for 2021.

Angara said MSMEs could help generate more economic activity for the country by moving towards digitalization, which many of them have done already.

“In the past year we have seen significant growth in our MSMEs. People who lost their jobs due to the pandemic were forced to find ways to generate income and for many of our enterprising kababayans, starting small online businesses was the way to go,” the senator noted.

The Department of Trade and Industry (DTI) said registration of MSMEs climbed to 88,000 as of end of 2020 from a mere 1,700 before COVID-19 hit the country.

The DTI said it expects e-commerce to grow from the current 3.4 percent of GDP in 2020 to 4.3 percent this year and to 5.5 percent in 2022.

Angara said he believes MSMEs key to success would be to move into e-commerce, since this would not only expand their market share, but would also be more cost effective than operating physical stores.

“What we need now is to help our homegrown businesses in moving towards digitalization and to have the entire government undergo digital transformation. We must work doubly hard to provide the infrastructure needed, starting with a fast and stable Internet connection in all parts of the country,” he stressed.