APEC Small and Medium Enterprises Ministerial Meeting
Thank you, your Excellency for your warm welcome.
I would like to thank Malaysia for hosting APEC this year.
To my Ministerial colleagues – I am delighted to participate with you in this APEC SME summit!
It is a timely meeting to share experiences of how different economies have mitigated the impact of COVID-19, given the global situation.
Today, I will share with you Australia’s approach to mitigating the impact of COVID-19, particularly our approach in supporting Micro, Small and Medium Enterprises.
Strong position going into the crisis
Australia, has, like other economies, been severely impacted by COVID-19.
As a government we have been able to take decisive action to cushion the blow of the pandemic for millions of Australian households and businesses because of our strong economic and fiscal position going into the crisis.
Prior to the pandemic, the Australian economy had recorded 28 consecutive years of economic growth.
The Government’s balance sheet was also strong, with low levels of public debt and we had a record number of people in employment.
Support for MSMEs
Micro, Small and Medium Enterprises are the backbone of our economies.
In Australia, they make up 99 per cent of all businesses and employ around half our workforce and contribute over one third of our economic output.
Micro, Small and Medium Enterprises have been central to the Government’s COVID 19 Economic Recovery Plan which is built around two elements.
The first is temporary and targeted support tailored to each phase of the crisis.
The second element is sustainable economic recovery and job creation.
In early March, in response to the pandemic, the Australian Government rapidly deployed a significant economic stimulus package.
The timeliness and size of the stimulus was vital in saving lives and protecting livelihoods. Since then we have continued to build on and tailor our support as circumstances have changed.
To date the Government’s unprecedented direct economic support in response to COVID-19 totals $257 billion or 13 per cent of Australia’s GDP.
This support is expected to result in economic activity being 4½ per cent higher by 2021-22 and the peak of the unemployment rate being lower by around 5 percentage points than would have otherwise occurred.
It is important to note that the support measures are designed to be temporary, targeted, and proportionate, to ensure they do not undermine the structural integrity of the budget.
Let me highlight some of the key response measures.
Cash flow is the lifeblood of small businesses.
Our COVID-19 response package has provided substantial cash flow assistance for businesses.
Our JobKeeper Payment, a wage subsidy for businesses significantly affected by COVID-19, has been instrumental in supporting job retention, maintaining employment links and business cash flow, and providing income support to eligible employees.
When it was announced, consumer confidence increased for nine consecutive weeks.
We also boosted cash flow for Micro, Small and Medium Enterprises employers by up to $100,000, again through our tax system and we improved access to finance with our Coronavirus SME Guarantee scheme, which guarantees up to 50 per cent of eligible SME loans.
And we put in place substantial support for the mental health and wellbeing of Micro, Small and Medium Enterprises owners who are facing significant pressures.
Road to Recovery
I would also like to talk briefly about the second element of Australia’s COVID-19 Economic recovery plan – measures to drive a sustainable private sector-led economic recovery.
As part of our 2020 Budget earlier this month, we announced our five-year JobMaker plan focused on creating jobs.
Let me highlight a few areas.
We are supporting Micro, Small and Medium Enterprises to ensure they can benefit from the rapid shift to the digital economy by providing additional funding to our National Broadband Network to bring ultrafast broadband to households and businesses.
We are enhancing MSME digital capability through expanding an existing program that provides small businesses with low cost, high-quality digital advice on websites, selling online, social media, marketing, business software and cyber security.
We are also focussed on cutting red tape to reduce business cost and make them more agile.
Thank you all for allowing me to share Australia’s experience.
Australia endorses the Ministerial Statement and strongly supports the SME Working Group’s Strategic Plan.
I look forward to hearing the experience of other economies.