THE COMMISSION on Audit (COA) reported that only P4.09 billion or 45% of the P9.08 billion allocation for the COVID-19 Assistance to Restart Enterprises (CARES) Program has been released as of June 30, 2021. The fund is meant to be distributed as collateral-free, zero-interest loans to micro, small and medium enterprises (MSMEs) affected by the pandemic.
Further, according to the COA, only 28,222 MSMEs availed of loans under the CARES Program, leaving nearly P5 billion in unused funds. The Small Business Corp. (SB Corp.), which runs the program, said only PP2.03 billion was left of the funds as of January 2022.
With billions in unused COVID-19 assistance for MSMEs, the government should look at where to cut the red tape in the distribution of aid to MSMEs. MSMEs struggling to recover from the impact of the pandemic cannot be idle for months while their applications are processed and the assistance released.
Indeed, one problem that must be addressed is the ease of doing business. MSMEs have to recover but they need the resources. And these resources should be accessed easily and not hampered by red tape. In this age, Information Communications Technology and the internet should help lighten the load, not turn people into digital slaves. In other words, reduce the paperwork and simplify the processes for MSMEs.
The COA report said that only 48,010 MSMEs applied for loans under the CARES Program, but 4,378 of these, or 9.12%, canceled their applications due to the long processing time and lack of updates on their loan application status. Enough of this. The government must find ways to ensure that the assistance meant for MSMEs find their way to MSMEs. Otherwise, there is no hope for economic recovery.
Why? Because 99.5 percent of businesses and establishments in the country are MSMEs. They employ 63% of labor and account for 40% of our gross domestic product. They are not a subsector of the economy — they are the economy.
According to a Department of Trade and Industry survey in June 2021, 10% of MSMEs had closed, 46% were partially operating and 44% were in full operation due to the pandemic. The survey, which covered 33,145 respondents, also found that 765,454 workers were displaced in the same period, down from 1.4 million.
We need to focus on MSMEs because when they recover, 99 percent of our economy will recover, 99 percent of lost jobs will return.
