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Small-Medium Enterprise Core Group in Zamboanga Peninula

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The Small-Medium Enterprises (SMEs) are considered as the backbone of the economy to support poverty alleviation, employment generation and economic growth with the collaboration among partner agencies in supporting entrepreneurship advocacy particularly in Zamboanga Peninsula (ZamPen). In 2011, the creation of ZamPen SME Core Group under the banner of Agency Convergence for Comprehensive Entrepreneurship Support Services (ACCESS) as an approach to promote and develop SMEs through the combined resources of the different agencies based in Region IX. This paper assesses the performance of the four (4) components of the group with their mandated functions, duties and responsibilities to ensure that SME activities will be carried out in consonance with the desired goals of SMEs.

Thus, this study assesses the performance of the ZamPen SME Core group in the delivery of their mandated tasks to strengthen the networking and coordination between and among agencies to promote and develop SMEs in the region. The findings proved that the active participation and collaboration of the four (4) elements of SME Core Group resulted to successful conduct of SME caravan, workshops and salient accomplishments to strengthen the SME activities in the region. Hence, this paper recommends to strongly support to RA 9501 series of 2008 and Resolution No. RDC IX-007-03 to continually strengthen the desired goals and objectives of SMEs that will boost the economic development in Zamboanga Peninsula.


Small Medium Enterprises (SMEs) shall be defined as any business activity or enterprise, whether single proprietorship, cooperative, partnership or corporation, engaged in the following:
a) industry;
b) agribusiness;
c) trade, and
d) services

Since the 1990s, there has been a resurgence of interest on the role of small-scaled business enterprises or small and medium enterprises (both will be referred to as “SMEs” hereafter) in national and international economic and social development. This is consistent with the overall shift of development strategies in many countries toward a more decentralized, even localized, approach. As such, many scholars, practitioners, and institutions involved in economic development have begun to recognize the important roles that smaller-scale business entities play in the economy and society. More and more people are becoming convinced that these entities can be a very effective means of achieving, not only economic progress, but social goals (e.g., a more equal income and a greater appreciation for diversity in gender and race) as well.

All of these suggest a greater need to increase our understanding of the nature and capabilities of family businesses and SMEs and the kinds of policies and incentive systems that would be appropriate, necessary, and effective in encouraging and strengthening them. This study paper will serve as an instrument to determine whether the continuing viability and growth of SMEs are being supported and assisted by the SME Core Group that may contribute to the regional development, as well as ensure coordinative and collaborative mechanisms to pursue the promotion of entrepreneurship and encouragement for the establishment of SMEs in the region.

This study paper evaluates the performance of the four (4) components of SME Core Group under the banner of ACCESS. Based on the findings and results, this study recommends appropriate solutions to problems encountered, as well as support the current activities conducted by the group that enable to achieve the desired goal towards economic development in Zamboanga Peninsula.

In 2011, SME Core Group adopted a banner program dubbed as ACCESS which stands for Agency Convergence for Comprehensive Entrepreneurship Support Services to strengthen the continuing collaboration among partners in supporting entrepreneurship advocacy.

Filipino entrepreneurs are urged to improve their products for the foreign market, as the Association of Southeast Asian Nations is gearing for a free trade area by 2015. Philippine-made products are admired locally and abroad for their craftsmanship and ingenuity. This year, more community-based enterprises will be set up in the countryside to enliven communities and provide jobs in localities where they will be situated.

a) Background to the Study

The National SME Development Plan is a priority strategy for developing the SME sector that comprises 99.6% of the total Philippine enterprises. This is a government initiative for the SME sector in order to provide a strong domestic supply base for globally competitive industries. The Philippines has special laws to protect small entrepreneurs – the Magna Carta for Small Enterprises Republic Act (RA) 6977as amended by RA No. 8289 and further amended by RA 9501 series of 2008, otherwise known as the Magna Carta for SMEs, provides that government efforts shall be coordinated to provide the necessary support and assistance to SMEs., and Barangay Micro Business Enterprises Act of 2002 (RA No. 9178). The Department of Trade and Industry (DTI) IX is at the forefront of promoting and developing SMEs. They are seeking the support and cooperation of line agencies to undertake the task. The Agri-Industrial Development Committee (AIDCom) IX passed Resolution No. 002 s. 2003 endorsing the request of DTI IX for support.

During the 106th Regional Development Council (RDC) IX meeting, the council passed a Resolution No. IX-007-03 entitled “A Resolution Supporting the Department of Trade and Industry (DTI) IX for the Creation and Operationalization of the Regional SME Core Group in Region IX” on February 21, 2003 in Dipolog City. The government is upgrading Micro SME (MSME) technology through a nationwide program, the Small Enterprises Technology Upgrading Program (SET-UP), being handled by the Department of Science and Technology (DOST). Launched in 2003, SET-UP provides technological assistance to enterprises, acquire needed technologies to improve their operations, increase productivity, and reduce production costs. From 50 projects in 2003 with less than R25 million investment, the program supported a total of 836 MSMEs with an investment of R427 million up to mid-2010. Many enterprises now export their products; over 18,000 jobs have been created. The program also assists would-be enterprises establish their businesses.

The total value for each category, after excluding the identified land are as follows: (Values of each MSE category, Department Administrative Order No, 9, series of 2008)
Micro-not more than P3,000,000
Small-P3,000,001 – P15,000,000
Medium-P15,000,001 – P100,000,000

In line with the 2012 commitment for SME development programs, DTI IX proposed for the conduct of Enhanced SME Caravan as one of the major activities of the ZamPen SME Core Group for the year. This activity basically provides direct assistance to the SMEs in the region. As the lead agency for SME Development initiatives, DTI IX spearheaded the said activity as its continuing commitment to bring the services of several regional line agencies (RLAs) to where the micro, small and medium enterprises are located. The regional SME Caravan which started in 2007 upto the present assisted quite a number of SMEs to include product development.

The ZamPen SME Core Group was organized to serve as the umbrella organization to look into the concerned efforts of government and private partner agencies on SME development. Under the latest development in which One-Town One-Product (OTOP) is being revived as a national program to alleviate poverty and generate employment, this will gear to the development of SMEs in Region IX, thus the conduct of an Enhanced SME Caravan is again proposed. In this particular undertaking, the SME Core group facilitated a one-on-one consultation with the SMEs.

b) Objectives of the Study

The following are the objectives of the paper:
a.To assess the performance of the group in support to the entrepreneurship advocacy; b.To evaluate the functions of the four (4) components of SME Core Group in addressing the concerns of the SMEs in the region; c.To provide the necessary assistance and strategies to SME Core Group in delivering comprehensive entrepreneurship support services to the target clienteles.

a)Administrative Theories for four (4) components of SME Core Group
SME Core Group has four components, namely: a) Financing; b) Market Development; c) Productivity and Efficiency; and d) Business and Enabling Investment Environment. Each component has its own functions and serves as the basis of the administrative theory to be applied in the proposed study. 1) Financing

It provides the new and existing SMEs with adequate financial resources through responsive financing services.

The head agency is the Land Bank of the Philippines with members agencies such as Development Bank of the Philippines, Department of Labor and Employment (DOLE) and Department of Science and Technology (DOST).

2)Market Development
It increases the exposure of SME products in the domestic and international markets as well as improves the distribution of products among and between the manufacturing and trade sectors.

This is headed by DTI with member agencies such as Department of Agriculture (DA), DA-Bureau of Fisheries and Aquatic Reaources (BFAR), Department of Tourism (DOT), Department of Agrarian Reform (DAR), and DOST.

3)Productivity and Efficiency
3.1) Technology Development
It creates and sustains the competitive edge of SME products in the domestic and export markets.

3.2) Training and Entrepreneurship
It provides the existing and potential entrepreneurs with the necessary skills and knowledge to become competitive players in the local or global market.

This is headed by DOST with member agencies such as Fiber Industry Development Authority (FIDA), Technical Education and Skills Development Authority (TESDA), Department of Health-Bureau of Food and Drugs (DOH-BFAD), Department of Environment and Natural Resources-Environmental Management Bureau (DENR-EMB), Philippine Coconut Authority (PCA) BFA R, DOST, DTI, DA, DAR, and DOLE.

4)Business and Enabling Investment Environment
It Informs the SMEs, business community, media, and other stakeholders on the available government services for SMEs, as well as builds awareness in the general public on the important economic roles of entrepreneurs and SMEs.

This is headed by Philippine Information Agency (PIA) with member agencies such as National Economic Research and Business Action Center (NERBAC), Department of Interior and Local Government (DILG), DAR, Commission on Higher Education (CHED), National Economic and Development Authority (NEDA) and DENR.

b) Theoretical Framework
1. Study of the effect of the government’s R&D program to SMEs using regression analysis.
Lee and Kim (2008) studied the random effect model about the industrial R&D investment strategy for the company result provision. The capital fund of a company was correlated positively (Ăľ) to the result of a company. It had a positive effect on the company result as there a high number of employees and the amount invested in R&D had a positive (Ăľ) effect on the company result as a whole. He insisted that customized R&D policy should be promoted in order to concentrate efforts on enhancing the effectiveness of an investment, and quantitative growth-centered policy could not help because it was limited.

Yu et al. (2005) verified the effect of R&D investment on the management result of venture business and SME by using multiple regression analysis. They confirmed that all areas for R&Dincluding R&D investment,R&D manpower, etc. have a positive and valid effect on the management result of an enterprise. The results of this study suggested that the effects of R&D investment on the management result of SME and that of venture business show nearly a similar pattern in that the SME itself is unable to connect intangible assets including intellectual property resulted from R&D, R&Dnetwork, marketing knowhow, and, etc. with the productive result of management.

Seo (2007) used regression analysis using Almon distribution parallax model in his research about the effect of R&D investment on the management result. In this study, he proved that the growth, profitability, and productivity of a enterprise was high if the degree of R&D costs were high and there was not a big distinction between the type of business or whether a company was listed or not. Kim et al. (2005) studied the influence ofR&Dinvestment activity on the management result of small and medium companies and venture business with random effect model. He proved that the influence of R&D manpower and the number of employees (except R&D people) on the management result was positive, and R&D investment capital fund and the management result was correlated positively. Moreover, it was identified that the number of years from foundation had a positive correlation with the management result, property effect and capital effect of SME were in positive (Ăľ) correlation, and that the effects were negative (2) in the case of venture business.

The above findings show that the number of employees, achievement of corporate management, and capital scale could have a positive effect on the management result of an enterprise. By using panel data from medium and small firms and venture business, it was proved that the index of company management including R&D investment and amount of sales, etc. had (þ) correlation, and that there was a difference existing between venture business and small and medium companies. Jung (2008) verified the effect of a Korea Securities Dealers Automated Quotation (KOSDAQ)-listed company’s R&D costs on the enterprise value correlation with multiple regression analysis which is modified from the model of Ohlson. The author confirmed below three issues; each item of R&D cost affects corporate value though not evenly; a different method of accounting also showedR&Dcost influences corporate value; venture businesses are far more influenced by R&D expenditure than general firms.

This research confirms the findings of prior research on R&D expenditure which shows the correlation of R&D expenditures and corporate value is different according to the characteristics of the corporation and industry by classifying development cost, research cost, ordinary R&D cost, and ordinary development cost, and analyzing the difference in R&D expenditure according to the characteristics of the corporation for KOSDAQ-registered companies by classifying venture business and general corporations a part from the prior research which compared the stock exchange and KOSDAQ.

Kwon (2007) verified the research about the management result of the corporation and R&D expenditure with multiple regression analysis. She confirmed that it has significant influence on the intention of using the relatives of R&D expenditure and business performance of corporations; top management support tended to have significant influence on the relation of R&D expenditure and business performance of corporations; research worker training support influenced the relatives of R&D expenditure and business performance of corporations significantly; strategic importance of R&D activity had significant influence on the intention of using the relation of R&D expenditure and business performance of corporations. This research suggested that R&D expenditure had significant influence, as much as top management support and effort of organization management in the manufacturing, and R&D expenditure had significant influence on top management support, research worker training support, and strategic importance of R&D activity, and that it affected the performance of corporations in the long run.

Lim (2007) analyzed the relation between R&D investment and achievement of corporate management. The author confirmed that R&D investment contributes to the profitability of a company in that if corporation spend on R&D as part of the operating profits of the company is high, the earning rate of invested capitals increases as intensiveness of R&D investment is higher. Also, the growth of the corporation through an increasing sales rate shows an increasing tendency as the intensiveness of R&D investment is higher, and the productivity since investment efficiency of total capital increases as intensiveness of R&D investment is higher. The result of this study suggests that since the current technological environment of industry is changing drastically, continuous R&D should be progressed in order to maintain the competitive power of an enterprise with a provision especially in the case of a technology-intensive industry like the chemical business.

Recently, because of sudden industry changes, it suggests that continuous R&D must be carried out if a technology-intensive enterprise like the chemical business wants to be sustainable.

Jeong et al. (2008) verified the effect of R&D investment and introduction of knowhow on the corporate value with correlation analysis and multiple regression analysis. They confirmed that public notice effect of knowhow introduction was higher in the group having higher R&D investment expenditure than low, and it was lowest in the group which spent the lowest amount on knowhow introduction and R&D investment. And the public noticed the difference between companies which invested more actively in R&D than in knowhow knowledge. In the result of verification of variables influencing the public notice effect of the corporation, public notice effect of knowhow introduction was high as R&D investment was high and the corporate scale was small. This result suggests that continuous innovation is required in order for a corporation to survive drastic technological development and an unpredictable future and can create high returns.

Park (2004) verified the effect of R&D investment on domestic SME on the company result with multiple regression analysis. It was confirmed that the growth of the corporation had a significant relationship with R&D investment of the human resource section and regression model; ordinary development investment was significantly correlated with the profitability of the corporation. The result of this study suggests that investment in the manpower research is superior to the long-term assets of R&D investment for the growing of small and medium companies, and investment in realistic R&Dis superior to industrial property which can enjoy long-term monopoly power and a high entry barrier for the profitability of the corporation. Choi (2004) analyzed the influencing factors of R&D project performance through factorial experiment. It was confirmed that the rational role of a reader greater enhanced a performance than the reader of an innovative role; the monitoring role of a reader showed higher results than the reader of a mentor role, and team performance was high as formulation or centralization was high.

Kim (2004) analyzed the performance factor by type of joint R&D research. It was confirmed that generality of technology, technical resources capability, and clarity of goal had an impact on the joint research satisfaction, technical resources capability Korean SME performance and clarity of a goal influenced on the joint research satisfaction in the type of corporation – university joint research, sense of intimacy, competent project manager, and the clarity of goal influenced the technical performance of joint research. In corporation-university joint research, generality of technology and technical resources capability gave an effect to the joint research satisfaction, generality of technology, competent project manager, technical resources capability, and clarity of goal influenced on the technical performance of joint research. And only technical resources capability influenced the joint research satisfaction in the type of corporation-research institute joint research. This study suggests that consideration of the technical resources capability of a partner is important when a company selects a partner, and clarification of common objectives is important when joint research is being performed. In the type of corporation-university joint research, selecting an intimate partner can make technical performance higher, and selecting an able project manager who is flexible and who can lead cooperation well with a university is important.

Kim (2008) verified the effect of possession structure on the correlation of R&D expenditure and corporate value with multiple regression analysis in which Ohlson (1995) model was changed. Asset handling development cost was shown to be of insignificant value regardless of the structure of possession in the market of securities, and in KOSDAQ stock market only the coefficient of professional manager group showed significant positive (þ) relation with the corporate value. Development cost of expense handling was (þ) relation in the securities market (2) relation with professional manager group and (þ) relation with ownership manager group in KOSDAQ stock market. Research cost had (þ) relation with professional manager group (2) relation with ownership manager group in the securities market, and (2) relation with ownership manager group in KOSDAQ stock market.

He confirmed the fact by classifying and analyzing the securities market and KOSDAQ that influence possession structure in relation to R&D expenditure and corporate value is different according to the market. Kim et al. (2005) verified the effect of R&D cost on the stock price with multiple regression analysis. He confirmed that the current price earnings ratio and the past R&D costs showed (Ăľ) correlation with the time differences. It checked whether accounting information about R&D cost of the corporation had an informing effect on the Korean stock market or not. Park (2004) verified the effect of R&D investment of small and medium manufacturing companies on the management result with multiple regression analysis of survey data. It was confirmed that companies whose R&D is bigger than 8 percent of average sales for three years have a great rate of technology acquisition than companies whose R&D is less than 8 percent. Further, it was suggested that the companies with less than 8 percent R&D use outsource companies more effectively.

In-depth analysis about the difference of R&D investment between small and medium manufacturing companies was made. Park (2004) verified the effect of correlation between exceeding profit and R&D costs on valuation with multiple regression analysis using a modified model of Ohlson (1995). It was confirmed that multiple stock price for R&D expenditure of corresponding research increased as correlation of time difference was high, and multiple stock price for R&D expenditure of corresponding research was reduced as simultaneous correlation was high. This research suggests that analysis of the case successfully creating future profit and not creating it is needed, and consideration of different methods of accounting for classified R&D expenditures can improve the correspondence of profit and cost. Baek (2004) verified the value correlation of R&D cost considering industrial economical effect with multiple regression analysis.

The author confirmed that appropriate evaluation of the value of the correlation between provided accounting information and R&D expenditure created, essentially, future economic benefit which was an asset. The result shows that objective evaluation can be possible by reflecting the characteristics of the industry to which the evaluative target company belongs and utilizing this in a valuation.

Ahn and Kwon (2006) analyzed the relation of corporate value and R&D investment based on the corporate renovation with the model measuring of corporate renovation based on Cobb-Douglas production function. It was confirmed that variables of corporate renovation had a significant positive relation with the price earnings ratio. This research is confirmed by other academic interpretations about the relation of corporate value and corporate renovation generated in a company which invests in R&D in the rapidly growing economic environment.

Lee and Kim (2008) analyzed the growth of the single step technical innovation strategy of the venture business and the R&D support effect of positive and negative as the multiple regressions. The absolute investment scale of the resource for technology development increased in the growth phase or the puberty venture business in comparison with the long-term venture business. We confirmed that the difference in which it is significant between the enterprise in which it doesn’t receive with the enterprise in which it does receive R&D support funds of positive and negative as to the technical innovation strategy did not exist.

Jo and An (2007) verified the research about the valuation of the KOSDAQ-listed company according to the features of a company with the log-linear model of Hand (2000) in which he develops the log-linear model of Ye and Finn (1999). Also, there was the correlation of (þ) as it noted the enterprise value. They confirmed statistically that there was a difference between R&D costs in the enterprise value correlation side. According to current profit, it suggests that it is necessary to evaluate enterprise value as mutually different. Seo (2008) verified the effect that R&D costs investment affected company growth, profitability, and productivity with the Almon distribution parallax model and the general distribution parallax model.

The growth and profitability of a company was high if R&D costs were high. And the fact that the productivity of a company is high was confirmed. Kim et al. (2005) studied the valuation methodology of R&D. In order to overcome the limit of the existing analytic hierarchy process (AHP) model, the functional size measurement method and the evaluation in which it applies the hybrid failure prediction method were developed. It further proved that the evaluation result of the AHP method is the evaluation system where there is the most feasibility (Table I).

c) Conceptual Framework
As shown in Fig. 2.1, the four components of SME Core Group are collaborated with one another by providing entrepreneurship support services to SMEs in particular, as well as to boost the economic development Zamboanga Peninsula in general.

The four (4) elements of SME Core Group are pointing towards the objectives of SME program. The collaborative effort of the group will result to positive economic development in Zamboanga Peninsula.


a) Research Design

This paper uses a qualitative perspective that emphasizes a phenomenological view. The paper is a too or approach to examine or assess the performance of the SME Core Group in support to the entrepreneurship advocacy and economic development in Zamboanga Peninsula.

An interview or consultation was conducted for SME clientele regionwide. The clienteles were interviewed based on the benefits provided or assisted to them by the SME Core Group.

b) Research Locale

Zamboanga Peninsula is a peninsula and an administrative region in the Philippines. Designated as Region IX, the region consists of three provinces, namely, Zamboanga del Norte, Zamboanga del Sur, and Zamboanga Sibugay, its component cities of Dipolog, Dapitan, Pagadian, and Isabela (Capital of Basilan Province, which is a part of the ARMM) and, the highly-urbanized and Independent city of Zamboanga. The region was previously known as Western Mindanao before the enactment of Executive Order No. 36 on September 19, 2001. (wikipedia.org)


With cautious optimism, Zamboanga Peninsula treads toward its most logical destination, that of evolving into a major player in the national economic arena. The region is eyeing at making a more significant contribution to the country’s GNP, having a bigger participation in the export market, and firming up stronger trade links with other regions and with the economies of Southeast Asia. Supporting SMEs to diversify economic activities in the rural areas, particularly in the processing of agricultural products, and in producing a variety of consumer goods is one of the specific action agenda to address the priorities of the regional development agenda. (Regional Development Agenda, Zamboanga Peninsula-Region IX).

The SME Caravan is basically putting MSMEs together into one venue and provide them with consultancy services and product development. Client services of the member agencies are availed by the participants during the one on one consultancy session. According to DTI IX, a total of 567 MSMEs were assisted in the provinces of Region IX from 2006 to 2012.

The tasks performed by the SME Core Group in Zamboanga Peninsula are the following:

1)Convergence of government agencies, financing institutions, and the private sector as key to development of the SMEs in the region; 2)The conduct of ZAMPEN SME CARAVAN and the promotion and development of Region’s Champion Products became the major programs of the SME Core Group under the ACCESS Program; 3)ACCESS aims to bring down the services and assistance of each member agencies to where the MSMEs are; and 4)ACCESS strengthens the continuing collaboration among partners in supporting entrepreneurship advocacy.

The activities conducted by the SME Core Group in Zamboanga Peninsula are the following:

1)Conducted of workshop on the value chain approach where members of sme core and industry stakeholders work together to draw the value chain map for each of the champion products on February 9-10, 2011 at Lantaka Hotel, Zamboanga City; 2)Conducted workshop on Convergence and Industry Planning for the Six Champion Products of the Region on January 26-27, 2012 in Zamboanga City; 3)Conducted a Stakeholders Conference for each of the Champion Products to validate the Value Chain, Constraints and Opportunities and the 2012 Action Plan for each industry on February 22, 2012 in Dipolog City; 4)Conducted Capability Building thru technology development and skills training thru the Component Head, the DOST and member agencies like TESDA, NCC , DA, DOLE, BFAR & DTI; 5)Established financing assistance and loans given by the DBP, LBP, Quendancore, DA and DOST. 6)Coordinated the participation in National Trade Fairs, Regional Trade Expo in 2008, Annual participation in the National Agra and Agri Fairs, OTOP Mindanao Island Fairs, and International Fairs such IFEX etc.

The accomplishments of each element of SME Core Group are the following: a)For Financing
1)DBP released loans to two (2)seaweeds projects worth Php 9.2 M and Php 25.0 M in Zamboanga City 2)DOLE identified two (2) projects for funding: a) Small Rubber Growers Assn Php 0.250 M; b) White Water Project Ph[ 0.300 M; c) Garment making Php 0.450 M; and d) Spanish Style Sardines Php 0.500 M. b)For Market Development

1)Market Matching between Yokohama Tire Philippines, Inc. and Cerilles Rubber. 2)FIDA has linked the following: a) ARBEMCO Kalawit, ZDN with Innovative Trader; b) 2 Farmers with Deco Fiber; and c) Sales to be monitored by FIDA

c)For Productivity and Efficiency
1)BFAR has Approved Funding for the following: a) Seaweeds Seedling Dispersal valued at PhP 135,000.00 for Zamboanga City; b) Seaweeds Farm Inputs worth Php 140,000.00 for Zamboanga City; c) Training Funds of P 30,000.00 for farm productivity and post harvest processing; d) 9 hectares of abaca nursery maintained for 5 coop farmers associations (FIDA); e) 30 hectares new abaca farms developed; and f) Four (4) trainings conducted on abaca handicrafts and one (1) abaca cultural management. 2)Promote Tri-partisan Productivity Program for TIMARBEMCO in Tungawan by DOLE which evaluated the following: a) Salt fertilization project with 113,280 bags of salt for 2,832,000 trees; and b) 454 jobs created under the Coconut Intercropping Program covering 313 has.

d)For Business and Enabling Investment Environment
1)FIDA issued 57 Permit to Transport of Fibers.
2)Prepared Integrated Abaca Development Program in the ARC of Zamboanga Peninsula. 3)Brontispa Control Projects involving 4,782 coconut farmers from 100 Barangays in 24 municipalities 4)Conducted 5 trainings for the Small Coconut Farmers Group (PCA) 5)FDA issued 13 License to Operate for Food Processors

6)DOLE conducted Enhance Management Skills and Organizational Strengthening to 3 associations. 7)Local Economic Development Program with funding assistane of Php 450,000 in selected barangays of Dapitan in ZDN

SME Core Group meets yearly to conduct activities such as SME Caravan to cater the needs of the clienteles in relation to economic development in the region. For this year, the SME Caravan was conducted on July 2-7, 2012 in three (3) provinces, namely: 1) Zamboanga del Norte; 2) Zamboanga del Sur; and 3) Zamboanga Sibugay. During the event, the respondents were being interviewed.

ARD Sitti Amina M. Jain of DTI IX, spearheaded the caravan. She presented the Overview of Activity. She gave a brief background and rationale of Small-Medium Enterprise (SME). She stressed that the yearly activity is done every first week of July nationwide. In Region IX, SME is under the banner program of ACCESS (Agency Convergence for Comprehensive Entrepreneurship Support Services) that would strengthen continuing collaboration among partners in supporting entrepreneurship advocacy.

She mentioned that SME Core Group enhances the growth of small and medium enterprises in the region which prioritizes the six (6) champion products, namely: a) seaweeds; b) abaca; c) banana; d) mango; e) rubber; and f) coconut. SME Caravan is one way to promote development and reduce poverty in the region. Furthermore, it is an activity that will bring the concerned agencies close with the beneficiaries/clienteles for consultation in relation to the products to be sold and known in the market. Hence, SME is the backbone of the economy particularly to alleviate poverty and generate employment.

SME Success Stories were shared by the three (3) clienteles from the different provinces of the region. They were the following clienteles who were able to share their success, as well as inspired others to be active in engaging and strengthening their business during the SME Caravan:

On July 2, 2012 in Pagadian City, Mrs. Conchita Taklain, Manager of Danlugan Farmers Multi-Purpose Cooperative shared a success story of their cooperative. Danlugan Farmers Multi-purpose cooperative is producing organic fertilizer and actively promoting organic farming among farmer-members. They are also the only cooperative in Region IX producing and processing dairy products from cow’s milk. This product is the most nutritious form of ration being used in the government’s program for school children and pre-schoolers. On July 4, 2012 in Dipolog City, Mr. Ernesto Tan, one of the owners of Mediatrix Homes, Inc., Misamis Occidental shared his “ups and downs” experiences in business with the participants. He even gave tips on how to cope up with the difficulties and struggles in handling business. At present, their real estate business is expanding in Misamis Occidental and Dipolog City to cater affordable and comfortable houses for the people.

Lastly, on July 6, 2012 in Ipil, Zamboanga Sibugay, Mr. Nestor Gargollo, owner of ROCKWOOD Sash and Furnishings in Siay, Zamboanga Sibugay also shared his family owned business success story. Their company is producing kiln dried solid wood furniture at its finest quality. He was a former DTI IX employee and opted to resign early just to focus on their business. They had a 47 hectares of reforested land in Siay and Kabasalan. DOST also assisted them in the pursuit of expanding their business. At present, they are able to provide employment as well as additional income to their local government unit.

Some of the clienteles experienced problems on capital investment. They cannot sustain their SMEs due to lack of financial assistance from the government. Not all member agencies of SME Core Group are actively participating in the SME activities.

Based on findings, SME Core Group in Zamboanga Peninsula under the banner of ACCESS is actively performing its tasks and mandates. The four elements (4) collaborated and coordinated with each other to provide necessary support and assistance to SMEs in Zamboanga Peninsula. Problems such as financial assistance for SMEs must be given priority. The government must have a fixed budget to be allotted for SME activities annually. Member agencies must have a Memorandum of Agreement to seriously commit on the tasks and mandate assigned to them through RA 9501 series of 2008 and Resolution No. RDC IX-007-03. Hence, this paper recommends to strongly support to RA 9501 series of 2008 and Resolution No. RDC IX-007-03, to continually strengthen the desired goals and objectives of SMEs that will boost the economic development in Zamboanga Peninsula.


The Manila Times; April 18, 2007
The Manila Times; April 27, 2006
•Asia Pacific Economic Cooperation (APEC), Survey on Small & Medium Enterprises, Coordinated by the Medium and Small Administration,
Ministry of Economic Affairs, Chinese Taipei (1993).
•Hooley, Richard and Muzaffer Ahmad, Small and Medium-Size Enterprises and Development Process in Four Asian Countries: An Overview (1980s) •Ji Young Park and Soo Wook Kim (2010), “An Empirical Model to Assess the Influence of the Government’s Research and Development Program on Korean Small and Medium Enterprise (SME) Performance”

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