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With reference to Singapore, recommend and discuss how local government can support SMEs during the current crisis.

Across The Organisation for Economic Co-operation and Development (OECD), small and
medium-sized enterprises (SMEs) account for 99% of all businesses and between 50% and
60% of value added. SMEs are particularly vulnerable during the crisis (OECD, 2020). The
restrictions put in place to tackle the Covid-19 epidemic directly and indirectly affect local
businesses. Some businesses, such as restaurants and cafes, have been closed due to
confinement measures, while other small and medium sized businesses have been able to
continue but with considerably reduced demand. Some have had to lay off or even dismiss their
personnel. Unless local businesses are able to restart soon in large scale, the crisis will mean
reduced tax revenues for central and subnational governments in the short and medium terms.
To help avoid bankruptcies among local business, central and subnational governments have
supported SMEs and tried to ensure their liquidity during the worst of the COVID-19 crisis.

 

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