The Government Business Support Strategies, Micro SMEs and Covid-19 Pandemic

Abstract

The COVID-19 pandemic, also known as the coronavirus pandemic is today regarded as one of the largest global public health crisis. The pandemic has not only endangered people’s lives, but has also jammed economic outputs of many countries the world over. As a result, different economic levels in various parts of the world have experienced a massive direct impact as a result of COVID-19. Small and medium enterprises (SMEs), in particular, had taken the worst blow, and the sectors of SMEs badly affected by this ongoing public health crisis include transportation, tourism, and food services, as well as accommodation. Government intervention is henceforth becoming increasingly important amidst the current extraordinary circumstance and are certainly required to be more comprehensive and unconventional than usual. In order to minimize the negative effects of the pandemic on SMEs, which are a vital organ of a nation’s economy, a comprehensive and creative form of assistance is therefore urgently needed to save them. Hence, this study aims to identify priority assistance programs most needed by SMEs. Besides, this study also examines how the assistance programs launched by the government match the actual needs of SMEs. Last but not least, this study also explores SMEs’ ability to survive the current crisis, in particular, by measuring their capacity to survive from possible risks of insolvency. Notably, this study finds that the role of government in supporting the growth of micro SMEs is becoming increasingly important and critical. Micro SMEs support programs therefore must be comprehensive and not focused on financial support programs alone. Advisory services and trainings, especially in the field of e-commerce and social media need to be made more accessible to micro SMEs. Undeniably, skills in the digital economy and social media are added values and offer great convenience for entrepreneurs to market their products more widely today. In essence, the findings of this study support policymakers in their efforts to improve current policies and at the same time, formulate new strategies related to the use of e-commerce for micro SMEs. Finally, the study also suggests that future researches incorporate more contextual variables into this study model and investigate those variables in more diverse geographical or cultural environments, thus revealing other relationships necessary to maintain the sustainability of micro SMEs.