Mian Kashif Ashfaq, Life Member of SAARC Chamber of Commerce and Industry Pakistan Chapter and Managing Director of Pakistan Furniture Council (PFC), said Micro, Small and Medium Enterprises (MSMEs) in Pakistan needed more growth capital to boost the sub-region. resilience to shocks following the COVID-19 pandemic.
Addressing the Kasur SME delegation led by Amin Akbar Chopra who called him here on Sunday, he said South Asian economies can strengthen their recovery and increase their resilience by channeling growth capital to start-ups and innovative entrepreneurs.
Mian Kashif Ashfaq said much of the support provided so far to MSMEs in the region has focused on ensuring access to working capital for businesses amid the pandemic, but that a More balanced support is needed both for companies hard hit by the pandemic and for those with strong growth potential. he added.
PFC CEO said: “Governments in South Asia, particularly Prime Minister Imran Khan, have made a significant contribution to the survival of MSMEs during the pandemic through a massive stimulus package offering interest rate subsidies. interest, refinancing, credit guarantees and mandatory lending quotas.
He said that in the longer term, more attention should be given to market-based financing through capital markets and digital platforms.
He said SMEs, including craft businesses (small manufacturing and home-based businesses), accounted for 99.6% of all businesses, 76.6% of the workforce and 33.9% of the product. gross domestic (GDP) of South Asia on average.
He said the credit market for these companies remains small, measuring 7.0% of GDP and 14.8% of total bank lending on average in the past, although the market is growing. He said microfinance helps meet working capital needs.
However, Mian Kashif Ashfaq said the rise of non-performing loans in the credit market remains a challenge.
He said a dedicated equity market for small and medium enterprises has emerged in the region, enhancing its role as a channel for providing growth capital.
Delegation leader Amin Akbar Chopra, concurring, said many MSMEs remain unregistered and informal, making it difficult for government support to reach them.—INP