Opening Remarks by Angel Gurría
Paris, France - 26 June 2020
(As prepared for delivery)
Dear Ambassadors, Colleagues, Ladies and Gentlemen:
It is my pleasure to open today’s meeting of the Group of Friends of SMEs alongside our very distinguished guest, Prince Constantijn of the Netherlands. Your Royal Highness, thank you for your commitment, passion and vision to helping start-ups and SMEs thrive across the world. And thank you for joining us today!
With UNMSME Day just around the corner – we will officially celebrate it tomorrow – today’s discussion could not be more timely. They say you meet your real friends in difficulty, and my goodness are these difficult times for SMEs.
The COVID-19 pandemic has triggered the most severe economic recession in nearly a century and is causing enormous damage to people’s health, jobs and well-being.
Our latest Economic Outlook paints a grim picture for global economic growth. In the “single hit” scenario, global GDP could contract by 6% on average in 2020. Under the “double hit” scenario – where we experience a second wave of infections – we may face a contraction of 7.6% in 2020. These figures are staggering! And they are scary because they have real-life implications for our economies and societies.
When we talk about these implications, entrepreneurs and small and medium sized firms (SMEs) are, of course, front and centre. Depending on the country, SMEs represent between 60 to 80% of total employment. And they have suffered disproportionately from the crisis, as they account for 75% of all jobs in the most affected sectors.
In this challenging context, entrepreneurs and young firms can play a particularly important role. While they are often even more vulnerable, in many cases they have also demonstrated remarkable agility in adjusting their business models and practices, and developing innovative solutions to the current crisis.
Moreover, changes in the nature of demand and business operations, particularly with respect to increased digitalisation and healthcare needs, are generating new opportunities for start-ups. In this respect, start-ups can indeed play an important role in the recovery, and drive structural change towards more sustainable economic growth.
Around the world, responses to the crisis from governments have been both swift and unprecedented. But measures to support SME liquidity have, in many cases, been inaccessible to start ups. Policymakers thus need to take the specific circumstances and roles of start-ups into account, both during the crisis and in the recovery. Let me briefly describe a number of actions that can be taken:
Ladies and Gentlemen:
SMEs and entrepreneurs are the lifeline of our economies and societies. COVID-19 has magnified their importance. They are our best allies to recover from this crisis. Only by providing them with the appropriate support will they be able to flourish and, in turn, help us to tackle the effects of the pandemic. We are very fortunate to convene the Group of Friends of SMEs here at the OECD to discuss lessons learned, best practices and forward-looking ideas. I wish you a productive discussion today.