MANILA, Philippines — Senate President Vicente Sotto III on Wednesday called on the Department of Budget and Management to augment the budget of the Department of Trade and Industry for its COVID-19 Assistance to Restart Enterprises (CARES) program which aims to help micro, small, and medium enterprises (MSME).
Sotto said the P1 billion budget earmarked for the program is not enough to help MSMEs resume their businesses after the strict quarantine measures implemented in several parts of the country earlier to contain the spread of coronavirus disease.
“Many small and medium companies are just starting to resume operations, with most if not all of them operating at 30 to 50 percent. They suffered huge income losses when their businesses were shut down for more than two months. It is the responsibility of the government to help them recover from their meltdowns,” he said in a statement.
The DTI program, launched in mid-May, aims to help MSMEs by providing loans ranging from P10,000 to P200,000 for micro-enterprises and up to P500,000 for small enterprises. The loan is channeled through the agency’s financing arm SB Corporation.
However, Sotto noted that barely a month after the program started, the SBC announced it was suspending loan applications as it has already reached the loan facility’s funding capacity of P1 billion.
He said the application period is too short for MSMEs to avail the loan, and that the DTI should reopen the application period to allow more small and medium businesses to apply.
“Many MSMEs were still in the process of assessing their income losses and have yet to determine the amount of funding assistance they needed to restart their businesses,” said Sotto.
The senator also said that the DTI should ask the Department of Budget and Management to “infuse” extra funds for the CARES program which has a P1 billion loan allocation.
Citing data from DTI, Sotto noted there are over 1 million business establishments in the country, of which, 99.52 percent or 998,342 are MSMEs, which are mostly located in Metro Manila, Central Luzon and Calabarzon.
According to Sotto, the DBM can tap the Executive’s COVID-19 emergency response budget to provide for the extra funds.
“Nananawagan po tayo sa DBM na dagdagan ng karampatang pondo ang CARES program nang sa gayun ay mabuksan muli ang application period. Sa ganitong panahon ng krisis, mahalagang maipakita ng pamahalaan ang kanilang tunay na pagkalinga sa ating maliliit na mga businesses,” he said.
(We are calling on the DBM to add funds for the CARES program so the application period can reopen. In this time of crisis, it is important for the government to show true care for small businesses.)