Tag Archive for: SIDA

COVID-19 takes a heavy toll on Myanmar’s wood-based micro and small businesses

The COVID-19 pandemic is exacting a devastating toll on wood-based micro, small and medium enterprises (MSMEs).

Furniture workshop’s owner in Thaketa Township, Myanmar. Source: Agus Djailani, EU FLEGT Facility

MSMEs are the backbone of Myanmar’s economy. They constitute 99% of formally registered enterprises, and generate significant livelihood and employment opportunities. But the pandemic has had severe impacts on customer demand, revenue, finances, workers and the availability and distribution of raw materials. Myanmar’s MSMEs also face difficulties accessing support from COVID-19 relief programmes.

These are the findings of a survey of some 200 MSMEs conducted by the European Forest Institute (EFI) and the Sagawa Institute of Organization Development. Members of the Myanmar Arts and Craft Association and the Wood-Based Furniture Association were surveyed as part of EFI’s Sida-funded work in support of forest- and timber-based MSMEs in the Mekong region.

The MSMEs were surveyed nationwide in August 2020, most of these micro and small businesses. The survey found that COVID-19 had forced most enterprises to stop or permanently close their business. A staggering 33.6% of respondents closed their operations permanently due to the crisis, while 65.2% stopped them temporarily.

As a way forward, an EFI briefing recommends that industry associations collaborate with the Government to ease the challenges that MSMEs face in distributing products and purchasing raw materials from official sources. The associations should also assist their members by providing documents and sharing information to help them access short- and long-term financial loans. Finally, associations have an important role to play in supporting business registration and licensing of informal enterprises to enable them to access COVID-19 relief programmes.

Read the briefing: COVID-19 impacts on wood-based MSMEs in Myanmar

Author: FLEGT.org Info

Supporting forest- and timber-based MSMEs in the Mekong region to operate legally and sustainably

Micro, small and medium enterprises (MSMEs) are a vehicle for development and generate almost half of jobs in the formal forest sector globally. They are key to local economies, generating significant livelihood and employment opportunities. Yet the recent economic crisis triggered by the COVID-19 pandemic has shown the vulnerability of MSMEs to sudden market developments.

Family-run workshop in a pilot MSME in Lamphun, Thailand. Source: EU FLEGT Facility

A new brief describes the approach adopted by the European Forest Institute (EFI) over the last five years to support forest- and timber-based MSMEs in the Mekong region to operate legally and sustainably.  The publication highlights the challenges and solutions tested, and lessons learnt from EFI’s interventions.

If MSMEs are encouraged to adopt legal and sustainable sourcing and processing practices, they can be part of the solution to reducing deforestation and forest degradation.

Growing their capacities, business performance and access to legal timber will allow these enterprises to participate in supply chains destined for regulated markets. This would in turn make them more resilient as businesses, with the potential to alleviate rural poverty and reduce impacts from crises such as COVID-19.

To this end, EFI has explored approaches that help forest- and timber-based MSMEs in the Mekong region to operate legally and sustainably. In six pilot projects in four countries – Laos, Myanmar, Thailand and Vietnam –  EFI tested solutions to some of the key challenges that MSMEs face: low productivity and operational capacity, lack of formal registration and operating licences, and poor representation in policy processes.

This work, supported by the Swedish International Development Cooperation Agency, shows that specialised trainings can improve MSME’s operational capacity and regulatory compliance. The potential for FLEGT Voluntary Partnership Agreement (VPA) processes to trigger and accommodate legal reforms in support of MSMEs is also highlighted.

EFI’s pilots demonstrate the importance of regulatory revisions for resolving key challenges to MSMEs, and the need for interventions targeting these enterprises to integrate business continuity planning. Crucially, supporting MSMEs to access finance is critical to support them to rebuild after COVID-19, and to operate legally and sustainably. 

Read the briefing:

Author: FLEGT.org Info