Digital Transformation is Key to Recovery
Transforming SMEs into digital enterprises is essential for providing resilience against pandemics according to several of the panelists participating in Global Manufacturing and Industrialisation Summit #GMIS2020.
The latest virtual panel session concluded government support alone is not enough to facilitate change, however, and entire ecosystems that include the public sector, private financial institutions, universities and small and micro firms will be required.
Panelists included experts from the United Nations Industrial Development Organization (UNIDO), the Arab Bank for Economic Development in Africa (BADEA), the Union of Arab Chambers and the Confederation of Indian Industry, with discussion focusing on how innovation is being nurtured in their countries and within their organisations, and to share best practices in supporting and encouraging SMEs to join the technological revolution against the backdrop of the Covid-19 pandemic.
The experts agreed that multi-stakeholder partnerships were central to facilitating innovation and creating resilience in SMEs. They also emphasised the need to channel investment into the SME sector globally, in order to help them develop world-changing innovations and digitise their processes and services in order to be ready to participate in the economy of tomorrow.
Dr Bernardo Calzadilla-Sarmiento, Managing Director, Directorate of Digitalization, Technology and Agribusiness, United Nations Industrial Development Organization (UNIDO), argued investment in bolstering the digital capability of SMEs is crucial to local, regional and global economic recovery, observing: “COVID-19 has put a lot of strain on our society and the economies around the globe.
“To help SME businesses continue to recover from the pandemic, they need proper access to finance and investment to help them foster digital capabilities. We need to ensure that SMEs are part of the digital transformation if we want to build a sustainable future – allowing progress that enhances the opportunities for all.”
Dr Hashim Hussein, Head of the United Nations Industrial Development Organization, Investment and Technology Promotion Office in the Kingdom of Bahrain (ITPO Bahrain), shared best practice from the last 20 years in supporting ecosystems that encourage both the domestic investment and mobilise foreign direct investment that can facilitate technological progress in 52 Countries around the world.
He added: “We must support SMEs around the world to become more engaged with technology and ensure entrepreneurial resilience. In Bahrain, we have long-running programs that support start-ups, micro, small and medium businesses through the creation of ecosystems that encourage investment and outside of the country, we are focused on supporting the industrialisation process of developing countries by helping to attract investment into SME programs that embrace technological change.”
H.E. Veronika Peshkova, UNIDO Goodwill Ambassador, agreed that helping SMEs develop digital capability is central to creating a sustainable future. She observed: “The world is becoming more and more automated with digital industry already representing 30 per cent of the world’s GDP whilst productivity annual growth rate is four times that of so-called ‘physical industries’. Seventy per cent of all investment is attracted to ICT, and yet COVID-19 is likely to drive this rapid growth even faster, transforming all industries. However, the speed of this change brings the risk of widening and increasing inequality between those who have the skills to adapt to the digital revolution, and those who don’t” – also drawing attention to the issue of gender balance in economic development, and how the digital revolution may exacerbate the problem.
Dr Khaled Hanafy, Secretary-General of the Union of Arab Chambers stated partnership was vital to nurturing SMEs and facilitating digital transformation, saying: “You need to have a system that works on every level of the economy to support entrepreneurialism. For example, not only do you need public-private partnership, but you also need to create partnerships with universities as this is often where the ideas originate. We are currently developing an innovation program that will be run across the Arab world creating training sites and mentor opportunities that will allow R&D to thrive.”
H.E. Safia Boly, Former Minister for the promotion of private investment, small and medium enterprises and national entrepreneurship, Government of Mali, added that partnerships that facilitate economic resilience at all levels are vital for building economic resilience, particular when discussing SMEs – also observing how “One of the key ingredients for building resilience and sustainability in Mali, is to ensure access to finance for small and medium enterprises. Have difficulty meeting the requirement of conventional financing with commercial banks means entrepreneurs often resort to institutions of microfinance.”
The discussion which was held under the title of ‘Impact Investment through the Enterprise Development & Investment Promotion Programme‘ was moderated by Nejib Friji, MENA Director of the International Peace Institute, and brought together leading experts from around the world to discuss ways in which investment can best be channelled to drive international development and drive prosperity. The panel discussed the type of support needed to sustain start-ups and the growth of SMEs and how entrepreneurs can embrace technological opportunities and be at the forefront of digitalisation and the Fourth Industrial Revolution. It also considered the requirements needed to achieve Sustainable Impact Investment – all against the backdrop of the current global pandemic.
The panel offered views and approaches from around the world, highlighting regional differences and highlighting opportunities for collaboration. Friji, was joined by Dr. Bernardo Calzadilla-Sarmiento, Managing Director, Directorate of Digitalization, Technology and Agribusiness, UNIDO; H.E. Veronika Peshkova, UNIDO Goodwill Ambassador; Dr. Hashim S. Hussein, Head of the UNIDO’s Investment and Technology Promotion Office in the Kingdom of Bahrain (ITPO Bahrain); H.E. Safia Boly, Former Minister for the promotion of private investment, small and medium enterprises and national entrepreneurship, Government of Mali; Dr. Khaled Hanafy, Secretary-General of the Union of Arab Chambers; Anjan Das, Executive Director, Confederation of Indian Industry and Director of Technology and Innovation; and Dr. Sidi Ould Tah, Director-General, Arab Bank for Economic Development in Africa (BADEA).
The virtual panel discussion was the latest in a new sequence of weekly sessions held by the #GMIS2020 Digital Series, following the Virtual Summit that was held on September 4-5, 2020. The session is available to watch on-demand at https://bit.ly/2YHVHyY.