Sustaining “Lilliputs” in the Global Knowledge-Based Economy: Prospects for Micro, Small, and Medium-Scale Enterprises in the Developing World

Abstract

Micro, small, and medium-scale enterprises (MSMEs) comprise bulk of business entities in the developing world. Their contribution is seen in terms of employment generation and capital formation. Seen as the engine of growth in present knowledge-based economies, MSMEs play a crucial role in the economic sustainability of Asian developing countries. This paper discusses the role of MSMEs in Asia, with the Philippines as a case in point. It examines issues and challenges these enterprises face, as well as, their role and impact in developing the Philippine economy and human capital. It explores mechanisms of European linkaging and assistance to the Philippine MSME sector. The paper posits that a supportive policy environment is necessary for these enterprises to achieve their potential for sustainable growth in a global knowledge-based economy. Keywords: Sustainability, micro, small & medium-scale enterprises, knowledge-based economy, European linkaging mechanisms