Helping small businesses in Asia-Pacific go beyond surviving disasters to thriving

BANGKOK, 11 December 2019 - With strong support from the ARISE networks in Japan, India and the Philippines, the UN Office for Disaster Risk Reduction organized a consultative workshop to identify pathways to help build the business resilience of micro, small and medium enterprises in Asia-Pacific.

Small businesses represent the bulk of the private sector in all countries, employ large portions of the population and are instrumental to the social and economic fabrics of their communities.

According to the Association of Southeast Asian Nations (ASEAN), micro, small and medium enterprises account for up to 99% of business establishments in their ten member states, contributing more than 50% of ASEAN’s GDP and employing more than 80% of the workforce.

Yet despite their significance, little data exists on the small businesses in most countries, and on the disaster impact on small businesses, perceptions of business owners of their risk environment, and their utilization of available tools. Moreover, the informal nature of many of these enterprises makes them invisible when it comes to disaster resilience and risk reduction considerations.

As the region faces a new trend of high-frequency and high-impact disasters due to drivers of risk such as urbanization and climate change, these small businesses are vulnerable to disruptions, and even closure, as a result of disasters. This also puts at risk the livelihoods of the people who are employed by them and the communities that benefit from their services.

While there has been progress in the region in promoting business continuity plans to improve preparedness, these plans do not address the drivers of risks, and have limited role in enabling such businesses take risk-informed decisions.

“Resilience building should go beyond minimizing disruptions. It should help businesses not only survive a disaster but thrive and prosper,” explained Mr Animesh Kumar, Deputy Chief of UNDRR Asia-Pacific, who set the scene for the consultation.

Around 25 participants from the private sector, development agencies, and technical experts shared their insights and case studies. A lack of access or utilization of financial instruments, including insurance, was cited as a problem in many countries, including developed countries.

Another common theme was the need to help small businesses become more active in building their own resilience. Recommendations included increasing their awareness of their vulnerability, connecting them with other small enterprises based on geography or sector, and offering them advice that is simple and actionable.

Participants also recommended to develop resilience standards and benchmarks for small businesses and use them to incentive their owners to invest in resilience building. UNDRR announced the launch of a global survey on small and medium enterprises that will result in a publication in 2020.

The recommendations articulated in the consultation will help shape the Asia-Pacific Ministerial Conference on Disaster Risk Reduction, which will be convened by UNDRR in 2020 and hosted by the Government of Australia. Increasing investment in resilience is a key pillar of the conference which will result in a political declaration and action plan.