Micro, small, and medium enterprises (MSMEs) have been navigating turbulent waters in recent years. The lingering effects of the pandemic, coupled with present challenges like inflation, lack of access to credit, and geopolitical tensions, have tested their resilience. In these trying times, MSMEs need all the support they can get.

Thankfully, help is now on the horizon in the form of Republic Act (RA) 11960, or the “Act Institutionalizing the One Town, One Product (OTOP) Philippines Program.” This crucial legislation, signed into law by the President on Aug. 25, 2023, promises to be a game-changer not only for the MSMEs but for the entire business sector.

According to a statement from Malacañang, RA 11960 is designed to “develop a self-reliant and independent national economy effectively controlled by Filipinos through policies and programs that drive inclusive local economic activity and boost national economic growth.” Furthermore, it aims to “provide adequate and effective support services for local MSMEs, led by the Department of Trade and Industry (DTI) in collaboration with various agencies.”
Senate President Pro Tempore Loren Legarda, the principal author and co-sponsor of the bill, hailed this legislation as a “monumental milestone for the MSME sector,” recognizing its role as “one of the backbones of the Philippine economy.” She emphasized that this law would not only cater to MSMEs but also serve as a strategic tool for achieving a more inclusive economic growth trajectory.

Legarda explained that RA 11960 institutionalizes the OTOP program that “promotes local products and capacitates the MSMEs through developing indigenous raw materials, utilizing local skills and talents, and featuring local traditions and cultures across the country.” Moreover, it also “addresses critical gaps in entrepreneurial skills, market compliance, and access to local and foreign markets.”

“The OTOP law is a long time coming. We are now in an era where every role of the Filipino, whether big or small, is deemed crucial toward a progressive nation. This law assures Filipino local businesses of our continuous commitment to MSMEs in upholding their welfare and growth,” Legarda added.
On the part of the House, Speaker Martin Romualdez said that the new law is the “true embodiment of the Filipino-first policy” and a “perfect post-pandemic law that would go a long way in helping the MSMEs.” 

What sets this law apart is its comprehensive package of assistance for MSMEs. It offers support in various facets, including quality improvement, product development, design, packaging, standards compliance, marketability, production capacity, and brand development, empowering Filipino businesses to create world-class products.

Soon, the DTI will introduce the “OTOP Philippines Trustmark,” a symbol of assurance that products under the program represent the best that our country has to offer.

The significance of the OTOP law cannot be overstated, particularly in a time when the local economy needs to regain its momentum. MSMEs play a pivotal role in providing livelihoods for millions of Filipino families. Their success ensures that not only will the majority have decent jobs, but it also guarantees that there will be food on their tables. The profitability of MSMEs empowers workers to provide a better future for their children, thus creating a ripple effect of progress and stability throughout our society.

With the law now passed, it is now time for concerned agencies to buckle down and put in the hard work needed to fully harness its potential.