Wednesday, September 20, 2017

Small businesses not yet ready for ASEAN competition

Myanmar is not ready to enter the ASEAN Economic Community that is supposed to come into existence at the end of the year, a government official has told business leaders.

Daw Aye Aye Win, deputy director general of the SME Development Department at the Ministry of Industry, was talking to the SME Forum 2015, a seminar for small businesses organised by the ASEAN Federation of Accountants, the Myanmar Accountancy Council and the Myanmar Institute of Certified Public Accountants, held on August 8 in Yangon.

According to the SME Development Centre, 87 percent of registered enterprises are SMEs.

To grow and compete within the ASEAN Economic Community, which is to officially launch at the end of 2015, Myanmar SMEs face several key issues such as financial management, access to capital and entrepreneurial development, participants heard.

“Myanmar is absolutely not ready yet for the AEC, though it will start in only five months. But as it is not only Myanmar but also other countries, they all are planning to mark that date, the end of December, as a great milestone for ASEAN. Our next target is 2025 for ASEAN integrity,” said Daw Aye Aye Win.

Myanmar’s emergence provides an opportunity to achieve strong inclusive growth. The development of its small- and medium-sized enterprises would be an effective mechanism in achieving socioeconomic growth, the forum highlighted.

Daw Aye Aye Win said her department focused on enhancing productivity, promoting financial reporting, developing market, policy and regulation, encouraging entrepreneurship and improving human resource management.

Myanmar’s main problem in joining the AEC would be integrating its domestic market into a regional market of 600 million, she said, adding, “Qualified SMEs can take advantage of the AEC and will be influenced by economically successful countries.”

Daw Sandar Win, senior lecturer in banking and finance at the University of Bedfordshire in the United Kingdom, said financial reporting was not enough from a banking point of view.

Kim Chawsu Gyi, managing director of the International Banking Division of KBZ Bank, said smaller Myanmar companies lacked capacity shortage, technical skills and knowledge of the regional market.