Priming SMEs for the ASEAN integration 2: Building LGU capability to promote mSMEs

business permit

At the recent roundtable on “Priming Philippines SMEs for the 2015 ASEAN Integration,” the Department of Local Government (DILG) discussed how it is helping local government units in developing capability to promote the emergence and development of micro, small and medium businesses among their respective constituencies. 

Bureau of Local Government Development Anna Liza F. Bonagua cited the collaboration between the DILG and the Department of Trade and Industry (DTI) in creating a  guide for LGUs in formulating their respective Local Investments and Incentives Codes (LIICs).

 With an LIIC, a city, province or municipality would be able to articulate its own investment policies and programs. Investment priority areas, and local incentives that both local and foreign investors can avail of.

Having an LIIC in place will allow a local government unit to more efficiently and systematically develop micro, small and medium enterprises, utilize local resources for local products, and stimulate ingenuity among  entrepreneurs, government agencies and other stakeholders.

The collaboration between the DILG and DTI has led to training programs that have provided skills to LGU staff in LIIC formulation.

The DILG has also taken initiatives to help LGUS enforce the provisions of the Barangay Micro Business Enterprises (BMBE) Law by encouraging more businesses in their jurisdiction to surface, register and take advantage of the tax, minimum wage exemption, and other incentives provided by the BMBE Law.

Memorandum circulars have been issued for the establishment of One-Stop Business Registration Centers in local government units to handle registration and processing of permits of barangay micro businesses.

The DILG has also clarified that pre-existing local ordinances in conflict with the BMBE Law are deemed amended or modified to comply with the law, consistent with the principle that a national law should prevail over a local legislation.

DILG Regional Offices are directed to submit semestral report on the implementation of the said Act.

Nationwide, a total of 22,574 micro businesses have been registered as barangay micro business enterprises.

In another program, the DILG seeks to improve the capacity of LGUs to be business friendly and competitive.  Components of the program include the organization of local economic development promotion office or team; formulating investment and revenue-generation policies at the local level; forging partnership with the private sector; conducting LGU competitiveness audit; and improving access to financing for basic infrastructure.

The roundtable discussions on the ASEAN integration was organized by the UP Institute for Small-Scale Industries (UP ISSI) in cooperation with the Small Enterprises Research and Development Foundation (SERDEF) and the Department of Trade and Industry (DTI).

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