INFORMAL WORKING GROUP ON MSMES

OPEN-ENDED MEETING OF 18 October 2024

Summary of discussions

The following communication, dated 29 October 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 third open-ended meeting of the year on 18 October 2024. Among the participants, 9 non‑working Group members joined the meeting (Angola; Botswana; Djibouti; Gabon; Niger; Samoa; Senegal; Thailand; and Togo).

1.2.  The meeting started with a presentation from H.E. Mr Nikolai Platonov from the Russian Federation who presented a joint proposal for the Informal Working Groups on MSMEs and on Trade & Gender (_INF/MSME/W/58-_INF/TGE/COM/11). This proposal looks to compile a compendium of educational programmes for women entrepreneurs. The Coordinator noted he will discuss next steps with interested delegates.

1.3.  The discussion then moved to implementation of the 2020 December Package of Recommendations and Declarations. In relation to Annex 1, China noted its inclusion of MSME information in its most recent trade policy review from 17-19 July 2024. MSME information pertained to policy support for MSMEs including tax preferences; MSME development funds; environmental research; government procurement; and the digitalization of MSMEs. The International Trade Centre updated the MSME Group on progress with the Global Trade Helpdesk (GTH). The GTH has seen large increases in the number of users linked to partnerships with local chambers of commerce and the developers are exploring AI chatbots to support users. Separately, the Coordinator encouraged MSME Group members to consider implementation of Annex 5 on the IDB decision from the MSME Group December 2020 Package given that so far only three MSME Group members have pursued this means to automatically share their WTO trade data obligations. Unfortunately, due to sound quality issues, UNCITRAL was unable to provide information on their new guide on Access to Credit for MSMEs, a subject linked directly with Annex 6. However, a summary based on the provided UNCITRAL presentation is included in the Annex to this document.

1.4.  For MC14 preparations, the MSME Group Coordinator updated Members on the two completed compendia, Access to Finance by Women-led MSMEs (_INF/MSME/W/46/Rev.3-INF/TGE/W/7/Rev.3) and Special Provisions for MSMEs in Authorized Economic Operator Programs (_INF/MSME/W/47/Rev.1). Both compendia continue to be updated and a new joint study on the integration of MSMEs into AEO programmes is under consideration with the World Customs Organisation and International Chamber of Commerce. In relation to other past deliverables from the MSME Group, the Coordinator made a request to Members for financial support for the Trade4MSMEs website. The website, which has a growing number of visitors averaging 3,000 a month looking for information on topics such as HTS codes and export readiness, is currently only funded through 2025.

1.5.  The first in-person "MSME Spotlight", Aziz Ndiaye, joined the Group in the morning to present ANEP, a Swiss-based exotic fruit company exporting from West Africa with a social mission. Mr Ndiaye, who grew up in Senegal, is the founder of ANEP and saw opportunity abroad for tropical fruits from this region. He has worked to import fresh and dried fruits and nuts from Cote d'Ivoire, Benin, Burkina-Faso, Senegal and Togo, helping to provide employment for 3,000 people, 80-90% of whom are women. He discussed the trade challenges he has encountered and improvements that have come, especially in terms of trade digitalization and electronic trade forms.

1.6.  The Group held a thematic session on how to bridge the gap between small businesses and policy developed by international organizations with the help of business support organizations as an intermediary, based on a recent United States' proposal (_INF/MSME/W/51). Crispin Waymouth, Deputy Head of Unit GROW D2 from the Enterprise Europe Network and Anne Chappaz from the ITC joined the MSME Group to explain how MSMEs are supported through access to databases, networks and partnerships facilitated by their organizations. The ITC further noted that BSOs can make a big impact by having a multiplier effect for smaller businesses. Due to technical difficulties, CENPROMYE was unable to present at the meeting as scheduled. However, based on provided documents, summaries of all three presentations are included in the Annex.

1.7.  In the afternoon, Members were joined by the two 2024 ICC-ITC-WIPO-WTO MSME Group 2024 Small Business Champions winners Justin Langan from O'KANATA and Carlos Zuastegui from CLAC. Justin Langan updated the Group on his work to create an online platform for indigenous artisans as both a marketplace and storytelling venue and Carlos Zuastegui informed the MSME Group of CLAC's work with indigenous producers to create informed webpages and B2C links as well as to establish a business roundtable. Dr Ayman El Tarabishy from the International Council for Small Business (ICSB) joined to provide a briefing as part of the MSME Group's efforts to strengthen engagement with external organizations. ICSB was instrumental in founding international MSME Day and works to share relevant research and strengthen global entrepreneurship. Additional technical issues prevented Anu Madgavkar of McKinsey from joining to present a recent report on opportunities for Small Businesses to Boost Productivity. Summaries based on documents provided by ICSB and McKinsey are included in the annex.

1.8.  Briefings on MSME-related discussions from other WTO bodies were provided by the Technical Barriers to Trade (TBT) Committee and the Government Procurement Committee. The TBT Committee presented its new good practice guide (_G/TBT/GEN/386) to assist TBT enquiry points in managing the commenting process, with implications for small businesses that would like to engage with reviewing and commenting on notified documents. The European Union, on behalf of GPA Parties, presented the GPA recent best practice guide for promoting and facilitating the participation of SMEs in government procurement (_GPA/CD/6).

1.9.  The next and final meeting of the year for the MSME Group is planned for 10 December 2024 with a thematic focus on trade digitalization and an experience-sharing objective on the topic of trade Good Regulatory Practices (GRP) for MSMEs. A joint WIPO-WTO solutions lab is planned for 18 November 2024 with the Informal Working Groups on MSMEs and Trade & Gender titled Empowering Women-led MSMEs: Unlocking Growth through Intellectual Property.

ANNEX

PRESENTATION SUMMARy

1  Guide on Access to Credit for Micro, Small and Mediume-sized Enterprises, UNCITRAL

1.1.  Monica Canafoglia from UNCITRAL provided the MSME Group with the document of her presentation on the soon to be published Guide on Access to Credit for Micro, Small and Medium‑Sized Enterprises (MSMEs). This guide joins UNCITRAL's many tools for the MSME life-cycle including Legislative Guides on Business Registration (2018), MSME Insolvency (2021), and Limited Liability Enterprises (2021). The Guide on Access to credit for MSMEs seeks to address the low creditworthiness of, and discrimination often faced by, MSMEs through measures that support relevant legal frameworks. It puts forward options for access to credit through MSME formalization, modern secured transaction regimes, support for MSMEs in financial distress, and affordable dispute resolution. It recommends support for MSME financial literacy and improved capacity of financers and regulators to serve MSMEs. Unfortunately, due to technical issues, the presentation was not fully delivered to the MSME Group on 18 October 2024.

2  Enterprise Europe Network

2.1.  Crispin Waymouth, Deputy Head of Unit GROW D2 at the Enterprise Europe Network (EEN), joined the MSME Group to present EEN's work to support businesses to internationalize. EEN includes more than 500 organizations in over 40 economies, with international network partners around the world. Organizations include specialized private and public bodies, regional government or development & innovation agencies, economic chambers, research institutes and professional associations among others. EEN helps MSMEs to innovate, become more sustainable and develop resiliency through digitalization and internationalization. EEN looks to find partners in EU member states, to make regional trade agreements more accessible and help businesses access available funding. EEN has a range of advisors from different types of expertise that come together in sector and thematic groups aligned with priorities like sustainability. EEN has an enormous impact assisting more than 800 companies through dedicated advice and training sessions achieving a 92% satisfaction rate and on average increasing client revenues by nearly 20%. Although EEN has a large number of partners globally, there is room to expand, especially in the African and Asia-Pacific regions. Mr Waymouth closed his presentation by sharing EEN's open invitation for entities to join the network as an international Network Partner.

3  Busness Support Organizations and the Mechanisms for Trade, ITC

3.1.  The presentation from Anne Chappaz, Chief of the International Trade Centre's (ITC's) Institutions and Ecosystems Section, highlighted the role of Business Support Organizations (BSOs) in fostering trade and supporting small businesses. Strong BSOs can make a difference by amplifying the impact and reach of export promotion programmes and helping MSMEs through consultation, information sharing, and coordination. The ITC's Institutions and Ecosystems Section provides digital tools, expertise, and capacity-building to BSOs primarily in developing economies to offer solutions to small businesses. Altogether, the ITC has helped more than 650 BSOs from 159 economies, supporting 1.7 million MSMEs, maximizing the impact of trade-related technical assistance by leveraging BSOs.

4  CENPROMYPE

4.1.  David Cabrera, Executive Director for CENPROMYPE, shared a document describing CENPROMYPE as a business support organization for the Central American (SICA) region focused on strengthening MSME internationalization through access to information and enhancing business specialization and modernization. CENPROMYPE has created regional mechanisms for policy coordination at local, national, and regional levels, aligning with UN sustainable development goals including gender equality and decent work and economic growth. CENPROMYPE has further implemented flagship programs such as "Mipymes en mercados" to boost MSME competitiveness, aiming to add 3,000 new exporters by 2030. It also provides tools like the Regional MSME Observatory and Business Intelligence System to facilitate market access and innovation for MSMEs and an Information System for Companies that provides business services and the exchange of good practices for the region. Unfortunately, due to technical issues, the presentation was not delivered to the MSME Group on 18 October 2024, however the slides were provided for review.

5  A Microscope on Small Businesses, McKinsey

5.1.  Anu Madgavkar from McKinsey shared the document of a presentation on the report titled "A Microscope on Small Businesses: Spotting Opportunities to Boost Productivity". This report analyzed MSMEs across 16 economies around the world reviewing 12 broad level-1 sectors and going down to more than 200 level-3 subsectors. An important finding from the study is that MSME productivity lags larger firms in every economy reviewed, with differences ranging from MSMEs being 16% less productive than large firms in the United Kingdom to MSMEs being 94% less productive in Kenya. Reviewing firms more granularly, scale matters and medium-sized firms were also found to be more productive than microenterprises across economies. MSMEs performed better in certain sectors such as ICT and worse in others like administrative services. Certain examples of win-win domains were revealed where MSME and large company productivity aligned, such as through vertical integration like in Japan's automotive manufacturing sector or capital and talent spillovers such as the US software development sector. McKinsey's findings ultimately show that MSME productivity and employment matrices indicating business performance levels can support development initiatives. Unfortunately, due to technical issues, the presentation was not fully delivered to the MSME Group on 18 October 2024, however the slides were provided for review.

6  Advancing Entrepreneurship Worldwide, ICSB

6.1.  The International Council for Small Business (ICSB) joined the MSME Group to provide information on its work to advance small business growth and development. Based in Washington, DC, ICSB collaborates with educators, researchers, policymakers and international organizations like the WTO and UN to promote sustainable entrepreneurship. ICSB supports MSMEs through partnerships, providing access to finance, policy support, and resources for innovation and international expansion. The new ICSB website provides access to resources including publications and upcoming events while simultaneously promoting entrepreneurship and fostering connections among members worldwide. ICSB founded the United Nations' MSMEs Day and publishes the Journal of Small Business Management (JSBM). For MSME Day 2025 ICSB is organizing an event to be hosted at the United Nations in New York titled Business for MSMEs – Connecting the Entrepreneurs.

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