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COVID-19 takes a heavy toll on Myanmar’s wood-based micro and small businesses

COVID-19 takes a heavy toll on Myanmar’s wood-based micro and small businesses

The COVID-19 pandemic is exacting a devastating toll on wood-based micro, small and medium enterprises (MSMEs).


Furniture workshop's owner in Thaketa Township, Myanmar by Agus Djailani, EU FLEGT Facility
 

MSMEs are the backbone of Myanmar’s economy. They constitute 99% of formally registered enterprises, and generate significant livelihood and employment opportunities. But the pandemic has had severe impacts on customer demand, revenue, finances, workers and the availability and distribution of raw materials. Myanmar’s MSMEs also face difficulties accessing support from COVID-19 relief programmes.

These are the findings of a survey of some 200 MSMEs conducted by the European Forest Institute (EFI) and the Sagawa Institute of Organization Development. Members of the Myanmar Arts and Craft Association and the Wood-Based Furniture Association were surveyed as part of EFI’s Sida-funded work in support of forest- and timber-based MSMEs in the Mekong region.

The MSMEs were surveyed nationwide in August 2020, most of these micro and small businesses. The survey found that COVID-19 had forced most enterprises to stop or permanently close their business. A staggering 33.6% of respondents closed their operations permanently due to the crisis, while 65.2% stopped them temporarily.

As a way forward, an EFI briefing recommends that industry associations collaborate with the Government to ease the challenges that MSMEs face in distributing products and purchasing raw materials from official sources. The associations should also assist their members by providing documents and sharing information to help them access short- and long-term financial loans. Finally, associations have an important role to play in supporting business registration and licensing of informal enterprises to enable them to access COVID-19 relief programmes.

Read the briefing: COVID-19 impacts on wood-based MSMEs in Myanmar