6% of 1.4M MSMEs remain closed
Only 6 percent of the more than 1.4 million micro, small and medium-sized enterprises (MSMEs) across the country remain closed this month, lower than the peak of 38 percent back in April, the Department of Trade and Industry (DTI) said, as more of the economy reopened despite the health risks.
Trade Secretary Ramon Lopez announced this during a budget hearing on Monday, citing the latest DTI survey that covered August and September.
He was asked by Senate Minority Leader Franklin Drilon for the total number of MSMEs that have closed shop during the pandemic. The trade chief then replied, citing the past DTI surveys. He did not say how many respondents each survey covered, but the last one covered 3,000 respondents.
In the April-to-May survey, 38 percent of MSMEs were closed. In June to July, this figure dropped to 11 percent. Then finally to the latest 6 percent.
“So the number of closed companies are getting fewer. In other words, there are those that are reopening,” Lopez said.
Drilon, however, did not seem convinced that the number reflected the reality on the ground.
“I find 6 percent, just from what I see around, a little too low. I think [it’s] more than that,” Drilon said, although he did not give an alternative figure. Lopez said 6-percent was already a high number in itself.
However, the struggle of MSMEs during the pandemic and the lockdown could not just be simply told by identifying which closed and which reopened. Reopening a business is one thing, keeping it afloat in this environment is another.
The latest announcements from the Bangko Sentral ng Pilipinas said that both the business confidence and the consumer confidence in the third quarter of the year had gone pessimistic because of the impact of the pandemic and quarantine restrictions.
Moreover, unemployment rate remained high despite improvements in the latest figures from the Philippine Statistics Authority (PSA). From a record-high of a 17.7 unemployment rate in April during the height of the lockdown, the figure had already dropped to 10 percent in July.
But as the head of research at the country’s leading online stockbrokerage COL Financial, put it, “an unemployment rate of 10 percent is still very high compared to historical average.”
“Since the PSA adopted the new unemployment definition in 2005, the unemployment rate never exceeded 9 percent until this year,” said COL Financial research head April Lee-Tan.
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.