- They represent 98% of all companies, (1)
- They generate 80% of registered private employment, (2)
- 98.20% of MSMEs have less than 100 employees (3)
- They contribute 50% of the wealth generated in the country in one year – Gross Domestic Product (4)
- They have an average of 3 to 4 employees each (6,180,799 jobs / 1,633,341 registered companies) (5). Other sources estimate 10 average employees.-
- They participate in 15% of exports.(6)
From these data it follows that:
- They are strongly market-internalist and, therefore, their economic support base depends on the level of internal demand in the country (real wages, pensions, pensions, subsidies that improve the income of individuals and families, etc.).
- The increases in wages and real income of the population are not only a cost for them; at the same time, they are a reactivating factor of the internal demand on which they depend. For this reason, they should not oppose an increase in real wages because that greater purchasing power translates into an increase in their sales. Example when the bonus is paid/charged.
- Any measure that is taken in relation to wanting to increase the level of employment must start from the need to promote, accompany, finance, the development, creation and strengthening of this sector.
- Today, in the popular economy sector, there are more workers in nine (9) provinces than in the private sector (Formosa, Santiago del Estero, Chaco, Jujuy, Salta, Misiones, Catamarca, Tucumán and La Rioja). In addition to deepening the bonds of solidarity, collaboration and mutual help. (7)
Categorization:
Traditionally they have been categorized from a quantitative point of view: Annual sales volume, investment in productive assets, number of employees.
Currently, the following Resolution No. 23/2022 of the Ministry of Productive Development of the Nation is in force, according to annual sales:
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And according to the number of employees:
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For a deeper understanding of them, it is necessary to disaggregate these scales taking into account: family farming, small farmers, entrepreneurs, companies recovered by workers, by region, technology, export, origin of capital.
To carry out this, it would be very important that State agencies, Universities, Research Centers and Entities that bring them together concur.
A deeper Database (Map) is essential to carry out a diagnosis and to plan specific policies towards this sector, and hierarchize it with a Ministries of MSMEs.
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Data as of December 2019: Industrial, productive, social regression, due to recession and external indebtedness (no pandemic or war).-
Years 2020-2021: Covid-19 pandemic.-
Year: 2022: NATO-Russia war with epicenter in Ukraine.-
From 2015 to date, there has been a drop in domestic demand, an increase in inflation, an increase in international prices, an increase in idle installed capacity, an increase in the profits of large exporting and price-setting companies, and a loss of competitiveness of the mipymes.
PLAN AND PROPOSAL OF MEASURES (expository, not exhaustive)
Within an independent, inclusive, environmentally friendly National Economic, Social, Cultural and Political Development Plan, drawn up in unity with the deepest democratic and popular participation of the affected sectors, which recovers the power of national decision-making, one can think of a series of of measures, some already in force and others to be implemented, such as:
Give greater equity to the tax regime, towards the increase in taxes on profits, personal assets, extraordinary and unexpected income, deducting sales of goods and services for popular consumption. In favor of encouraging the re-investment of profits, in capital goods and the incorporation of technology, increasing personal deductions and non-taxable minimums for small taxpayers, those who generate new and quality employment and substitute imports. Recover the resources evaded by flight of capital and great wealth. A determined fight against tax, labor and social security evasion. Set segmented employer contributions in favor of MSMEs and discourage the “judgment industry” for unjustified reasons without loss of rights for workers.
Redarquía companies.jpg
Courtesy: Large SMEs
Facilitate access to credit for MSMEs by making rules more flexible, and prioritizing the State Bank, Cooperative and national private. Reform the law of financial entities (inherited from the military dictatorship) considering financial activity as a public service, orienting to a greater extent the granting of loans towards SMEs with subsidized rates and/or that are at levels compatible with their profitability. Establishing a score of priorities based on the contribution to innovation, production of goods and services that do not exist and could be in demand, substitute imports, increase exports, generate employment, local trade (against parasitic intermediation), towards productive activities and not the speculative-financial ones. Make other financing access instruments more flexible: Trusts, Leasing, Warrants, Factoring, Securitization, Reciprocal Guarantee Companies (SGR), Issuance of Shares and SME Negotiable Obligations. Encourage the development of Business Incubators, the Tax Credit program for education and for the development of entrepreneurial attitudes. Prohibit foreign banks from capturing national savings (deposits from national residents).
Strict price control for price makers, avoiding unjustified increases. Avoid transferring domestic prices to international ones. Application of the Law on Supply, Consumer Defense, Defense of Competition, Gondola, Care Prices (and care supplies). Regulate the commercialization of grains and meat from the State (Regulatory Boards), Nationalize Vicentín through YPF-Agro and finalize the creation of the National Food Company (in favor of local trade), reviewing value chains. Promote in State purchases, in all its jurisdictions, the “buy national”, the “buy mipyme”, the “buy regional”.
Give a strong impetus and support to the social economy sector: MSMEs of all areas, cooperatives and mutuals, companies recovered by workers, together with the related state economy sector.
A more equitable distribution of national income: Increases, in real terms, in salaries, pensions, pensions, social subsidies. Increasing the “indirect wage” through access to free public education and health, housing and land ownership of those who work or wish to work.
conclusion:
MSMEs are a fundamental element for autonomous, inclusive, democratic, and equitable economic-social development, against a model that increasingly concentrates wealth in a few hands, is unequal, and predators of the common goods of all humanity.
MSMEs (and even less salaried workers) are not the cause of: inflation, devaluations, the fiscal deficit, external indebtedness, unemployment, poverty and indigence, capital flight, financial speculation, etc. etc.
Public Accountant – Professor of Economics UTN-UNER-UADER-ISFD
Sources:
(1)(2)(4) APYME proposals for a development project with social equity – 2022.pdf
(3) (https://ucema.edu.ar/sites/default/files/2021)
(5) https://www.argentina.gob.ar/noticias.-
(6) (https://www.argentina.gob.ar/noticias/las-exportaciones-de-mipymes)
(7) (https://www.telam.com.ar/notas/202204/589033-economia-popular-mayoritaria-nueve-provincias.html)
(8) faithful.org./statistical annex
(9) (https://ucema.edu.ar/sites/default/files/2021)
Source: Ambito
