MSME Growth
While there still lacks a universally accepted definition, Micro-, Small and Medium Enterprises (MSMEs) are widely recognized for the important contributions they make to sustainable development, in terms of contributions to economic growth, creation of decent jobs, provision of public goods and services, as well as poverty alleviation and reduced inequality.
MSMEs comprise a major share of total private sector entities in both developed and developing countries. The critical contribution of MSMEs to broader social-economic objectives, including job creation makes them a key priority area for achieving the Sustainable Development Goals (SDGs). Job creation through MSMEs will often directly benefit the poor and vulnerable, particularly women and youth, thereby directly reducing poverty, increasing income and positively impacting on household investments in education and health over time.
MSME development has the potential for wide-reaching impacts on the SDGs globally.
SDG 1: No poverty MSMEs help reduce the proportion of men, women and children of all ages living in poverty through job creation and economic growth.
SDG 2: Zero hunger MSMEs make up the majority of the world’s food producers and ensure sustainable food production systems.
SDG 4: Quality education MSMEs are key drivers of employment, decent jobs and entrepreneurship for youth and adults.
SDG 5: Gender equality MSMEs employ a disproportionate number of women and girls, and play a key role in ensuring women’s full and effective participation in business and trade. Almost 40% of small businesses are owned by women, meaning that MSMEs play a large role in closing the gender gap.
SDG 8: Decent work and economic growth With conducive policies in place, MSMEs can help societies achieve higher levels of economic productivity as drivers of diversification, technological upgrading and innovation.
SDG 9: Industry, innovation and infrastructure Drivers of innovation, MSMEs often fill gaps in the marketplace and come up with novel products and services.
SDG 10: Reduced inequalities MSMEs are crucial in increasing incomes for the bottom 40% of the world’s population. MSMEs account for more than 90% of enterprises worldwide and empower communities to lift themselves out of poverty, reducing inequalities.
SDG 12: Responsible consumption and production More flexible than large companies, MSMEs are more likely to adopt sustainable business practices.
SDG 17: Partnership for the goals Achieving any of the goals means that the public and private sectors must work in partnership. Key is for the public sector to ensure that the right policies are in place for the private sector to fulfil its potential as a driver of sustainable change.
