INFORMAL WORKING GROUP ON MSMES
OPEN-ENDED MEETING OF 1 July 2024
Summary
of discussions
The following communication, dated
17 July 2024, is being circulated at the request of the Coordinator of the
Informal Working Group on MSMEs, Ambassador Matthew Wilson (Barbados).
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1.1. The MSME Informal Working Group (MSME Group) met for its second
open-ended meeting of the year on 1 July 2024 (see convening notice _INF/MSME/CN/26/Rev.2). Among the
participants, 9 non‑working
group members joined the meeting (Angola; Bangladesh; Haiti; Madagascar; Nepal;
Rwanda; Samoa; Thailand; and Togo). The Group welcomed four new members since
its last meeting, namely Maldives, Cabo Verde, Mozambique and Mauritius,
bringing the total number to 103 MSME Group members. Representatives from Cabo
Verde, Maldives and Mauritius took the floor to reaffirm the importance of
small businesses to their economies and their support for the work of the MSME
Group.
1.2. Members reviewed a short recording of the 2024 Small Business
Champions winners, CLAC from El Salvador and O'KANATA from Canada, in advance
of a live virtual presentation in October. They also received an update from
one of the 2023 Champions, Divasity from Nigeria, who launched their initiative
to support small scale farmers in April.
1.3. For the 3rd "MSME Spotlight", Usha Subba,
Director of La Mandala, joined the MSME Group at the recommendation of the
Enhanced Integrated Framework (EIF). La Mandala is a specialty tea business
from Nepal with exports to economies in Asia and Europe. She highlighted her
entrepreneurial journey but also made reference to some of the trade challenges
she would want WTO Members to be aware of. These included the variation in
border procedures and non-tariff barriers related to certification
requirements, such as for organic labelling. Through the EIF's help, La Mandala
has been able to assist their suppliers' production process with organic manure
and fertilizer.
1.4. The MSME Group also received a presentation from Pamela Ugaz from
the United Nations Conference on Trade and Development (UNCTAD) on the May 2024
Global Supply Forum in Barbados. This inaugural conference had 64 sessions on
many subjects related to MSME trade including digitalization and green and
resilient supply chains as well as the launch of more than 30 initiatives
like the Trade and Transport Cost Dataset by UNCTAD and the World Bank. The
2026 Edition will be held in the Kingdom of Saudi Arabia.
1.5. Members updated the Group on their work to implement the 2020
December Package of Recommendations and Declarations. Canada updated the Group
about their 12th trade policy review (TPR) held in June, which
included information on Canada's new Export Diversification Strategy aimed at
reducing MSME export challenges. China also noted that its 9th TPR
will be held on 17 July and will include references to support measures for
MSMEs as per Annex 1. The ITC joined to present updates on the Global Trade
Helpdesk (GTH) in relation to Annex 2 including the new Mandarin version of the
website and efforts to implement the Jaipur Call for Action with a navigational
generative AI chatbot, a robotic process automation (RPA) generated market
summary, and AI-powered tutorials. The EU noted the submission of its most
recent data to the GTH in March. Related to Annex 3, the United Kingdom noted
it had fully implemented the TFA and continued to support the WTO IDB Decision
(Annex 5) and MSME access to finance (Annex 6). Regulatory development in
conjunction with MSMEs (Annex 4) is also a priority as underscored by their
proposal on good regulatory practice (GRP).
1.6. The Group discussed five new proposals for future work. The United
States put forward a proposal (_INF/MSME/W/51) to bridge the gap
between International Organizations and MSMEs to raise awareness of publicly
available trade information, including through the roles of Business Support
Organisations. The United Kingdom issued a three-part proposal (_INF/MSME/W/52) on GRP; supporting
women-led MSMEs that lag in terms of access to networks, skills, and scaling;
and digital trade including legislating the Model Law on Electronic
Transferable Records (MLETR) to support paperless trading. Mexico submitted
three proposals on low-value shipments and e‑commerce (_INF/MSME/W/53); the issue of
informality and UNCITRAL tools to address this (_INF/MSME/W/54); and MSMEs and
regional trade agreements (RTAs) (_INF/MSME/W/55). Members welcomed
the proposals and were generally supportive of continued discussion on these
topics and of the UK's proposal for a guide for GRP and compilation of case
studies for paperless trade. Members underscored the need to work closely with
other WTO groups and Committees where relevant, including the Informal Working
Group on Trade and Gender on supporting women‑led MSMEs. The Chair proposed
organizing a thematic session on business support organizations at the next
MSME Group meeting in October.
1.7. A joint proposal for the MSME Group and Informal Working Group on
Trade and Gender was received following the convening notice deadline from the
Russian Federation for a compendium on educational programs for women-led
businesses, which will be presented at the Group's next meeting.
1.8. A first thematic session was held on Authorized Economic Operator
(AEO) programs with a MSME dimension, with a presentation of preliminary
findings from a recent World Customs Organization (WCO) survey of the SAFE
Framework of standards by Lazzat Daniyarova. In line with the joint MSME Group
and WCO Compendium on MSME Provisions in AEO programs (_INF/MSME/W/47/Rev.1), more than
half of respondents (55%) indicated that their AEO programs allow for certain
MSME flexibilities. The WCO indicated interest in continuing to work with the
MSME Group in this area. Members welcomed the cooperation with the WCO. The
European Union suggested that a dynamic online database of the AEO compendium
would be useful.
1.9. Marlynne Hopper from the Standards and Trade Development Facility
(STDF) briefed the Group on the STDF's work to support MSMEs in developing
economies and to streamline and reform SPS measures to facilitate understanding
and implementation. The link between STDF, GRP, low-value shipments,
informality and digitalization through e-certifications was made and the STDF's
openness to engagement with the MSME Group was underscored.
1.10. The regular meeting with the private
sector took place on 5 July with three questions posed to participants about
the use of AEO programs, the importance of business support organizations and
any comments related to the MSME Coordinator's report for MC13 (_WT/MIN(24)/9). Concerning
AEOs, a participant noted that investment in AEO certification by MSMEs does
not always automatically translate into business growth nor does it always
differentiate competence by smaller businesses especially if AEO regulations
are diluted for MSMEs. Instead, it was noted that improving MSMEs' awareness,
knowledge, and competence for AEO certification is important to ensure MSME
uptake of AEO programmes. The discussion
also addressed the difficulty MSMEs, particularly women owned businesses, face
in raising capital. One new issue placed on the table by the private sector was
the need for better IP protection and monetization for small businesses. It was
suggested that a program or course to help MSMEs monetize IP to obtain
financing could be beneficial. The Chair highlighted the work of WIPO in this
area and some thought was given to a joint event with the Informal Working
Group on Trade and Gender around IP for women owned MSMEs.
1.11. The Chair noted that the next meeting of the MSME Group is planned
for 14 October 2024 and
the Trade4MSMEs Network meeting with relevant International Organizations is
scheduled for 9 September 2024.
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ANNEX
PRESENTATION SUMMARy
1 Global Supply Chain Forum, UNCTAD
1.1. Pamela Ugaz from UNCTAD joined the MSME Group to present the
outcomes from the first Global Supply Chain Forum, held in Barbados from 21-24
May 2024. With more than 200 speakers and 64 MSME sessions, the Forum looked to
address the pressing "4 C" challenges for supply chains: Climate
Change, Conflicts, COVID-19, and Costs of Capital. The Forum focused on the
digitalization of trade processes, fostering greener and more resilient supply
chains, and enhancing partnerships. New tools like AI and Blockchain, along
with integrated digital corridors and mutually recognized standards were
discussed as important components for digitalizing supply chains. Discussions
on greening supply chains noted the need for MSMEs to adopt sustainable
practices to lower carbon emissions given their importance as suppliers. The
role of public-private partnerships and access to finance for MSMEs was
stressed to enhance capacity and ensure diversified supply chains. The UN
Global Compact introduced the Sustainable Supplier and SME Programme to support
SMEs in the green transition, emphasizing collaboration and compliance with
sustainability standards. The UN Global Compact also introduced SPARK, a
community of SME participants that provides a "preferred supplier"
status for companies looking to reduce supplier emissions. The event concluded
with the launch of over 30 initiatives aimed at improving trade and transport
costs, supporting women in innovation, and addressing future challenges such as
carbon border adjustments and gender inequality in the maritime sector. Overall,
it was underscored that MSMEs need skills development, especially related to
climate tools, and there is a need for political will to increase trade
facilitation and mobilize resources. The next Forum is scheduled for 2026 in the
Kingdom of Saudi Arabia.
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