Accelerating MSMEs Growth through Innovation & Technology Improving the competitiveness of MSMEs through Public Procurement
MSMEs account for approximately 97% of private firms, 3.5% of GDP, and 80% of employment in Jamaica (Ministry of Industry, Investment and Commerce, 2019). Surveys conducted by the Jamaica Manufacturers and Exporters Association to ascertain the impact of the COVID-19 pandemic showed that some 22% of micro, small and medium manufacturers were forced to reduce staff or implement pay cuts, the pandemic had forced 22% to action a temporary closure, 8% of the businesses had to reduce their staff and 12% had to reduce their opening hours due to the curfew restrictions. This has had a rippling effect on the economy.
For the calendar year 2020, real GDP fell by 10.2%. This was the first year of contraction following seven consecutive years of GDP growth. There were lower output and employment levels, as well as reductions in household consumption, business investment, exports and government revenues (PIOJ, 2021). Agriculture, Forestry & Fishing and Manufacturing declined by 7.2% and 0.4% respectively. In January 2021, there were 1,194,800 employed persons. This was 74,300 (5.9%) fewer persons when compared to January 2020. The decline in female unemployment (5.5%) was notably higher than that of males (3.3%).
The experience of the “Great Lockdown” has induced greater levels of usage and acceptance of digital and online options locally, changed business models and boost levels of entrepreneurship as persons sought to maximize on the opportunities presented by the crisis and identify new income streams. The Government of Jamaica (GOJ) has identified the digitalisation of the public service and the economy as two critical means by which to rebuild the economy.
To support the digital transformation objectives outlined by the GOJ, mechanisms must be created to improve MSMEs access to comprehensive and targeted business development training and information and ensure that they meet the requirements to access the funding and technical resources available. Effective strengthening of business continuity and resilience in the context of the COVID-19 crisis and beyond must be reliant on the application of technological and non-technological tools complemented by sound business skills, knowledge and reliance on credible data.
The proposed programme outlined herein is a set of inter-linked strategies to catalyse and encourage MSMEs adoption of technology to improve their competitiveness, market reach, boost their productivity and enhance their resilience. The components include specific activities geared at improving access to business development training and technical assistance to strengthen start-ups and MSMEs, increasing the number of MSMEs accessing markets through the upskilling of entrepreneurs, creating channels for on-boarding to existing e-commerce platforms and developing a Digital Business Service Platform for MSMEs which uses Artificial Intelligence to leverage data to inform business strategy at the micro level and policy implementation at the macro level.
The cloud-based MSME Knowledge Bank/Virtual Campus will consist of on-demand, self-pace interactive business tools and resources specifically designed for businesses as they transition along the business continuum from micro, to small to medium.
The MSME Knowledge Bank/Virtual Campus is to be complemented by the training and upskilling of entrepreneurs in digital transformation and connecting them with practical technological tools to improve their operations and expand their market access.
In 2020, JBDC partnered with Fygaro E-Commerce Generator to provide practical solutions for MSMEs to move their commerce online in an efficient, cost-effective manner through the utilization of the company’s competitive infrastructure. The turnkey solution allows entrepreneurs regardless of their background or technical skills to develop a professional site optimized for the sale of their products, services, generate invoices and conduct accounting and logistics operations all in one location. The partnership allows for continuous training with local MSMEs and their on-boarding to the platform.
Additionally, in 2020 the JBDC established a partnership with CIAL, Dunn & Bradstreet to increase the visibility of Jamaica’s MSMEs in local and overseas markets as well as increase and establish their credibility through tools such as business ID, digital badge, business analysis report, B2B matchmaking and a credibility certificate. It creates opportunities for businesses to find the most valuable customers and prospects with precision, engage them with personalized content, and accelerate pipelines with sales intelligence solutions through the platform’s capabilities to validate suppliers and distributors in export markets.