Lahore: Pakistan ranks 3rd in government support provided to Small and Medium Enterprises to mitigate the impact of COVID-19, said Small and Medium Enterprises Development Authority on Tuesday.
It said that according to a recently launched “Impact of COVID-19 on SMEs” Survey Report conducted on-line by SMEDA, Asian Development Bank Institute (ADBI) and Asian Productivity Organization (APO), majority of enterprises in Pakistan were facing cash flow (82%) and raw material (65%) shortage. However, 11.44% SMEs in Pakistan expect their sales revenue to increase as compared to 2019, while 12.29% respondent enterprises expect their sales revenue to remain the same.
The survey was conducted by ADBI and APO in other countries from 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.
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 36.44% respondents reporting a significant decline in domestic demand. In comparison 72.29% enterprises in Bangladesh, 50% in India, 42.52% in Indonesia and 63.5% in Malaysia reported a significant drop in domestic demand.
In terms of government support provided, Government of Pakistan’s Electricity Support Package played a role in supporting SMEs directly during these trying times with 27% 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.