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The Importance of Prioritizing SMEs After The 2022 Floods

Avatar Written by Techjuice Team · 1 min read>
Small and medium enterprise
Contributing almost 25% percent to the country’s export SMEs are a major business segment that has been devastated by recent floods

The 2022 flooding have massively affected life in Pakistan, around 118 of the country’s 160 districts have been destroyed by flood water and heavy rainfall. Comparing these numbers to the 2010 flooding it could easily be determined that the recent flooding is worse than anything the country has experienced.

Most areas including lower Sindh and Balochistan are still covered in flood water and with heavy rainfalls expected to continue in September, it’s unlikely for these places to be flood free soon. Amongst all these havoc businesses especially small and medium enterprises that worked around these areas have been shut down, while there exists no accurate data and figures, but it could easily be predicted that many of these SMEs will fail to revive themselves after the floods are over.

With 25% of Pakistan’s exports being contributed by SMEs it surely is an important market segment that should immediately be revived. Considering the seriousness of the situation, the Small and Medium Enterprises Development Authority (SMEDA) should immediately collaborate with disaster management authorities and local banks and central banks in order to restore the damage that has been done.

Things that would ensure the revival of Pakistan’s SME sector are prioritization and urgent loan schemes that provide all small and medium business affectees to take up easy loans and restart their businesses. Doing this will not only improve the local area economy but also help the country in the middle of an economic recession.

According to a survey, Pakistan has over 5 million SMEs that work in different sectors such as manufacturing, trading, services and IT etc. Combined together these SMEs contribute 40% of Pakistan’s GDP.

Present in such large numbers, these SMEs can once again be revived by 2023-24 if the authorities act quickly and work alongside the government to bring these businesses back onto their feet.

With more expected rainfall, power shortages, inventory damage and a decrease in labor, the hopes for many SMEs are quite low but how and when will they be able to reach the position they stood at before the floods? That is a question only time can answer.

Read More: https://www.techjuice.pk/40-million-were-raised-for-the-diamer-bhasha-dam-while-63-million-were-spent-on-its-advertising/