Pakistan among countries effectively safeguarding SMEs from Covid-19 impact: survey

LAHORE: Pakistan has been ranked 3rd in government support provided to SMEs to mitigate the impact of Covid-19, according to a recently launched survey report titled “Impact of Covid-19 on SMEs” conducted online by Small and Medium Enterprises Development Authority (SMEDA), Asian Development Bank Institute (ADBI) and Asian Productivity Organisation (APO).

The survey was conducted by ADBI and APO in other countries of the region, including Indonesia, India, Bangladesh, Malaysia, Vietnam, Mongolia and Lao PDR. The online survey was administered in August 2020 and lasted till September 2020, in which 236 SMEs from Pakistan participated.

Findings of the survey revealed that the majority of enterprises in Pakistan were facing 82 per cent cash flow and 65pc raw material shortage. However, 11.44pc SMEs in Pakistan expected their sales revenue to increase as compared to 2019, while 12.29pc respondent enterprises expected their sales revenue to remain the same.

Among the changes reported in the business environment between February and April 2020, Pakistan was the best performer in the region, in terms of the percentage of enterprises, with only 36.44pc respondents reporting a significant decline in domestic demand.

In comparison, 72.29pc of enterprises in Bangladesh, 50pc in India, 42.52pc in Indonesia and 63.5pc in Malaysia reported a significant drop in domestic demand.

In terms of government support provided, the government’s electricity support package played a role in supporting SMEs directly during these trying times with 27pc respondents in Pakistan reporting that they received support through payment of utility bills.

Respondents in other countries, however, reported different areas of support received, such as new bank loans or deferred payment of bank loans.

Businesses being impacted by the economic crunch due to the debilitating pandemic reported that they require support in payment of utilities, tax exemptions or lower tax rates and rent payment to deal with the impact of Covid-19.

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Hassan Naqvi
Hassan Naqvi
The writer is a staff reporter and can be reached at [email protected]
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