Supporting SME development in Latin America and the Caribbean

Small and medium-sized enterprise (SME) development is a marked priority for policy makers across Latin America and the Caribbean. SMEs comprise 99.5% of firms in the region (with almost 9 out of 10 classified as micro-enterprises) and generate 60% of formal productive employment. However, while it is a normal global phenomenon for SMEs to display lower productivity levels than large firms, Latin American SMEs have a particularly significant productivity gap, being responsible for only a quarter of the region’s total production value. Against this background, the OECD has developed benchmarking tools to provide independent and rigorous assessments of the policy environment for SMEs across a number of policy areas, as well as guidance for policy reform and implementation on the basis of these assessments. Through its SME Policy Index and country reviews, the OECD works with the region to strengthen SME policy making as a tool for sustainable economic growth and productive development.

SME Policy Index

In order to achieve a better understanding of the challenges facing Latin American and Caribbean SMEs and to develop more targetted policies, the OECD LAC Regional Programme partnered with CAF – Development Bank of Latin America – and SELA (Latin American and Caribbean Economic System) to adapt the OECD SME Policy Index (SMEPI) methodology to the LAC region for the first time over 2016-2019. The SMEPI is an analytical tool developed by the OECD, in co-operation with international partners, to map SME policies and programmes and to assess alignment with good practice over time. The Index was developed for application in emerging economies within the context of the Organisation’s Global Relations programmes. Since its first application in 2007, it has been used in the study of 32 economies and four regions worldwide.

This first application of the Index methodology in the LAC region covers the four Pacific Alliance member countries (Chile, Colombia, Mexico, Peru) and three participating South American countries (Argentina, Ecuador, Uruguay). Divided into seven policy dimensions, this report assesses the strengths and weaknesses that exist in different areas of SME policy design, implementation, and monitoring and evaluation, and provides guidance to policy makers in identifying policy areas for future reform according to international good practices. 

SMEs are particularly at risk of failure from prolonged coronavirus (COVID-19) lockdown measures. Explore how OECD members and partners are supporting their SME sectors during this challenging time, as well as OECD experts’ suggested policy considerations and recommendations.


Compare your country data visualisation

The OECD SME Policy Index is a benchmarking tool that assists emerging economies in monitoring and evaluating progress in policies that support small and medium-sized enterprises. This interactive data visualisation tool presents the final scores of the first-ever (2019) assessment conducted in the LAC region. Try it now to see how countries perform in the different dimensions and sub-dimensions of the Index.

The SME Policy Index is based on the results of two parallel assessments. First, a self-assessment, which consisted of completing a questionnaire and providing relevant evidence (including statistical data), was conducted by each of the six governments. In addition, the OECD and CAF conducted an independent assessment that included inputs from a team of local experts from the FAEDPYME network, who collected data and information and conducted interviews with key stakeholders and private sector representatives. The final scores are the result of the consolidation of these two assessments, enhanced by further desk research by the OECD and CAF, as well as consultations with government and private sector representatives during country missions. The scores range from 1 (weakest level of policy development) to 5 (strongest level of policy development).

SME resources

Project donors

The LAC Regional Progamme work on SMEs is generously supported by the Development Bank of Latin America (CAF) and  the Latin American and Caribbean Economic System (SELA).