INF/MSME/R/17  
 
21 July 2020  
(20-5007) Page: 1/3 
  Original: English  
 
 
INFORMAL WORKING GRO UP ON MSMES  
26 JUNE 2020 MSME DA Y WEBINAR  
Summary of discussions  
The following communication, dated 20  July 2020, is being circulated at the request of the 
Coordinator of the Informal Working Group on MSMEs.  
 
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Two webinars were held at the WTO on MSME Day to review the effects of the Covid -19 pandemic 
on these businesses from the perspectives of national governments and international organizations. 
Speakers in the first panel discussed actions taken by C ôte d'Ivoire, the European Union and the 
Philippines to support their MSMEs during the Covid -19 crisis . Measures focused on access to finance 
to provide domestic MSMEs with short term liquidity and also digitalization efforts, including training, 
e-payment systems and new trade initiatives like Blockchain4EU in the EU.  
 
The second panel focused on the rese arch and recommendations international organizations have 
taken concerning the pandemic and the private sector, especially traders. MSMEs are recognized as 
the most impacted business size in this pandemic, given the industries they are focused in and their  
limited resources. International organizations noted the need for short term liquidity support 
followed by structural reforms to facilitate trade and increase MSMEs' digital connectivity, among 
others.  
 
1  SUMMARY OF DISCUSSIO NS 
1.1.  The first speakers' panel beg an with H.E. Félix Miézan Anoble, Minister for the Promotion of 
Small and Medium Enterprises in Côte  d'Ivoire who described the importance of MSMEs to the 
Ivoirian economy. Recently, Ivoirian MSMEs have been promoted through a two -pronged policy. The 
first pillar, Act 2014140 implemented in 2014, created a national policy direction for the promotion 
of MSMEs to support access to finance, market access, capacity building and technology transfer. 
The second, known as the Phoenix strategy, was designed by the Ministry for the Promotion of Small 
and Medium Enterprises following the post -electoral crisis in 2015. It involves measures at all levels 
of the economy (national, regional and subregional) and is aimed at removing barriers to MSMEs 
and increasing their p articipation in the economy. Following a project with the support of the 
World  Bank called the C ôte d'Ivoire SME Revitalization and Governance Project, the Ivoirian 
government renewed its efforts to assist MSMEs by implementing a number of core tools, incl uding 
the establishment of the Ivoirian SME Agency. An SME Guarantee fund has also been in operation 
since 8 January 2020 with provisional funds of CFA 30 billion designed to provide credit backing for 
loans issued by commercial banks. However, it is still  challenging for MSMEs to access loans based 
on current financial systems that require proof of assets that MSMEs often do not have. Nationwide 
there have been other initiatives to set up incubators, increase human capital,  simplify tax measures 
and make p ublic procurement more accessible to small firms through sub -contracts. Finally, the 
Covid -19 pandemic has been a challenge. Pro -MSME measures have been taken and include an 
economic and humanitarian support plan that amounts to CFA 250 billion. Support ha s also been 
offered to MSMEs to provide the necessary paperwork to access this fund. C ôte d'Ivoire also supports 
the Organization for the Harmonization of African Business Law (OHADA) simplified legal regime for 
all businesses with a turnover of less than CFA 50 million. Pursuing OHADA recommendations during 
Covid -19, C ôte d'Ivoire made business registration free for informal firms online with the Ivoirian INF/MSME/R/17  
 
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 SME Agency in February 2020 and C ôte d'Ivoire called on all international organizations to accelerate 
the operationalization of this system in order to broaden their national tax base during, and after, 
the pandemic.  
1.2.  Lucian Cernat, Chief Trade Economist for the European Commission, followed with a 
presentation of a recent study examining the rol e of MSME s in extra -EU trade  and the Covid -19 
pandemic. To counter the pandemic, the European Commission has applied a number of horizontal 
policies to favour all businesses  in areas like digitalization and greening production processes. 
Mr. Cernat discussed three of the paper's key policy findings. First, MSMEs are key European 
exporters in certain sectors including agriculture and textiles, accounting for more than half of all 
export value in these sectors. Second, MSME exports are already of low greenhouse gas intensive 
products meaning they are important for accomplishing the EU's environmental goals to reduce 
CO2 emissions. Third, MSMEs are a driving force of job creation  and support over 13 million goods 
and services exporting jobs. Mr. Cernat underscored the fact that MSMEs are important for the 
diversity of exports and that the EU is a top trading partner for more than 80 WTO members. 
However, small European firms are n ot diversified when it comes to GVCs, the majority having only 
one supplier of imported inputs, meaning that supply chain disruptions can halt production. The 
EU estimates there will be significant declines in trade that could leave millions unemployed. Fu rther, 
when MSMEs go out of business there are high fixed costs for them to return to production. The 
EU consequently recognizes the necessity for EU support policies. Mr. Cernat also briefly noted the 
EU initiative to develop blockchain solutions for trad e. He called on WTO Members with similar 
initiatives to connect with the EC in order to develop an interconnected system.  
1.3.  Mr. Jose Antonio Buencamino, Deputy Permanent Representative from th e Mission of the 
Philippines to the WTO followed next with an overview of the serious economic effects Filipino MSMEs 
have faced because of the pandemic. More than half of the MSMEs in the Philippines had to close 
their businesses at the peak, with the fig ure reaching 70 per cent in the capital region. The 
Philippines government enacted the Bayanihan to Heal as One Act at the start of April 2020 to 
mitigate the effects of the pandemic. Five categories of initiatives were put in place, including one 
to promo te MSME access markets, including training for accessing e -commerce marketplaces. 
Mr. Buencamino underscored the need to increase e -payment options for MSMEs so that they can 
participate in new selling venues more effectively. Importantly, a measure to def er taxes and duties 
was implemented, including duty waivers for traders of critical supplies like PPE. Access to finance 
through the Philippines Small Business Corporation and other departments have ensured access to 
liquidity and enabled borrowers to defe r payments. Finally, other initiatives include providing online 
training to employees and access to new technologies for businesses. Overall, Filipino businesses 
are encouraged to leverage digital business solutions and to continue innovating.  
1.4.  The second speakers' panel started with a presentation by Marion Jansen, Chief Economist of 
the ITC, who presented the ITCs recent work to understand the effects of the crisis on MSMEs and 
their value chains, including a survey that found that 60 per cent or more of micro and small 
enterprises are strongly affected by the pandemic and one fifth expected closure in the next three 
months. Three quarters of firms experienced reductions of sales and firms reported particular 
challenges when it came to logistics services, a crucial component of trade. The survey also found 
that more than half of MSMEs struggled to access Covid -19 related benefits and the ITC has called 
on businesses, business support organizations and governments to coordinate in the ITC's 15 point 
action p lan. The ITC has looked to provide MSMEs with direct assistance through the Global Trade 
Helpdesk  with new information on measures related to Covid -19; new webinars with private sector 
partners, especially  those related to finance and logistics; and concretely helped MSMEs transition 
to the production of masks and move their sales online.  
1.5.  Ernesto Lopez -Cordova, Lead Economist at t he World Bank presented an overview of the bank's 
recent work related to Covi d-19 and the ways the pandemic has affected businesses through 
channels including demand, supply, financial shocks and general uncertainty. The World Bank has 
compiled a database  of MSME -support measures adopted around the world in response to Covid -19. 
Mr. Lopez -Cordova noted that small, informal, or young firms face ex tra challenges, especially when 
it comes to accessing finance given their different level of risk. Public assistance in these cases is 
especially needed and governments should work to maintain business access to finance and to ease 
tax obligations. He note d that the crisis has different stages and that the first goal at the outset 
should be to keep workers employed and maintain the link between employer and employee. 
However, as the pandemic unfolds it will be necessary to move into a recovery phase which w ill 
require a clear exit strategy from the various programs implemented. In relation to trade, INF/MSME/R/17  
 
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 Mr. Lopez -Cordova recommended that trade -credit arrangements should be expanded and import 
duties kept low to facilitate the entry of necessary foreign inputs. S eparately, the World Bank also 
issued a business survey to businesses. Preliminary results indicate that firms are responding to the 
crisis by transitioning to digital platforms and tools as well as by changing their product mix.  
1.6.  Lucia Cusmano, the Acting Head of the OECD SME and Entrepreneurship Division noted that 
the OECD issued a policy note  on national policy responses noting that small businesses are at the 
center of the crisis: small firms, especially micro firms, dominate in the most affected sectors, have 
experienced strong drops in revenue and face an existential threat in the short -term. Services sector 
MSMEs in particular have expe rienced a very strong drop in business confidence and business 
dynamism has taken a severe blow as the pandemic prevents new businesses from coming online. 
Ms. Cusmano underscored the need to act now as the crisis risks going from a liquidity problem for 
business to an insolvency or bankruptcy issue as the pandemic lingers. In the OECD's observations, 
initial measures have focused on short -term liquidity for MSMEs but are increasingly turning to 
structural policies including assistance for MSMEs to adopt di gital technologies and find new market 
channels to continue operations. Given MSMEs' key role in OECD economies in terms of output and 
employment, sustaining these businesses will be important. Ms. Cusmano noted a number of 
challenges governments should be  aware of going forward, including MSME access to new policy 
measures, the repayment limits MSMEs will face for debt -based support measures, the need for 
smart conditionality to link short -term to longer term objectives with MSME measures. Going forward 
the OECD intends to continue to monitor MSME policy responses to the crisis and will look at MSMEs' 
digitalization journey through their D4SME initiative given its importance in response to the 
pandemic.  
1.7.  Vyara Filipova, Technical Attaché, World Customs Organ ization (WCO) followed with a 
description of pre - and post -pandemic resources the WCO has available for traders. Besides the 
typical information available before the pandemic, including the SAFE Framework of Standards to 
Facilitate Global Trade and the Mod el Business Lens checklist for MSMEs, the WCO has now created 
a joint repository with the WTO  of Covid -19 Trade Facilitation resources. To counter the crisis, the 
WCO has had weekly meetings with their private sector consultative group (PSCG) and issued three 
papers on the impact of Covid -19 and ideas for the WCO and its Members. Ms. Filipova noted  the 
crucial role customs can play in the pandemic including the facilitation of cross -border relief supplies 
and support for supply chain continuity. The WCO had a number of recommendations for Members 
to sustain customs operations at the border which wou ld help MSMEs in particular. These include 
the creation of a helpdesk to answer exporter and importer questions and disseminate information; 
duty relief measures such as installment payments or duty drawbacks focused on MSMEs; penalty 
waivers for the late arrival of customs documentation; waive the requirement for paper 
documentation and generally simplify and automate border procedures; and allow for flexibility in 
extending AEO certifications. Finally, Ms. Cusmano called on Members to consult with the pri vate 
sector before implementing changes and to facilitate cross border e -commerce.  
1.8.  Maximo Torero  Cullen, Chief Economist at the Food and Agriculture Organization , ended the 
webinar with a discussion of the pandemic's effect on the trade of agricultural pro ducts. Although 
the number of food export restrictions has increased since the pandemic, the number of countries 
that have implemented these measures remains limited (a full list of Covid -19 related food policy 
measures is available here). Given the anticipated increase in public debt, rising unemployment and 
general economic downturn there is a real concern about more global food insecurity. Mr. Cullen 
noted that priority needs to focu s emergency food assistance towards vulnerable populations by 
ensuring that purchases of food for humanitarian purposes are exempt from restrictions and that 
the free and predictable flow of food is allowed globally. MSMEs in agricultural value chains shou ld 
also be the targeted recipients of aid to ensure the food supply through the provision of 
concessionary loans and access to finance, particularly as small producers may have been unable to 
sell their harvests due to lockouts. The FAO is also looking to accelerate inter -regional trade, 
especially in Africa, such as through the creation of a "green corridor" of storage facilities. New 
technologies, including horizontal farming, robotics and e -commerce are also areas that have taken 
on a greater interest gi ven the social distancing requirements of the pandemic.  
 
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