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Pymelab 2022: A bridge for Cuban and Belgian entrepreneurs
Under the auspices of the Embassy of the Kingdom of Belgium and the Ministry of Economy and Planning of Cuba, Pymelab 2022 is being held in Havana with the aim of exchanging experiences on the economic role played by small and medium-sized enterprises in today’s societies.
At the meeting, entrepreneurs, financial and banking institutions, as well as public officials, will discuss the role of financing as a key resource for the emergence and consolidation of MSMEs. Cuban and European companies will also be presented with the aim of sharing experiences of their development.
Since the expansion of new economic actors began in the country, 2,974 private and 51 state-owned MSMEs have been created.
During the opening remarks, the Belgian Ambassador to Cuba, Jean-Jacques Bastien, highlighted the complex economic situation the world is going through due to the pandemic. In this respect, he commented that the current international context is not favourable for economies, and, therefore, growth is due more to internal factors.
This new edition of Pymelab comes at a sui generis moment, he said, since, unlike previous editions, a group of MSMEs have already been approved in the country, following the approval of the regulatory framework for this purpose.
The European country has more than one million micro, small and medium-sized enterprises, which means that for every five “economically active Belgians”, there is one type of economic business organisation. “These SMEs account for 63% of GDP and 99% of exports”.
For her part, the Cuban deputy minister of the Ministry of Economy and Planning, Johana Odriozola, valued it as unprecedented that in such a short time the country has managed to create more than 3 000 MSMEs. However, she warned that it is not possible to talk about achievements, as they are just beginning their journey and the real impact on the economy is not yet measurable.
“The growth and diversification of the business fabric is an indispensable condition for the economic growth that we Cubans owe ourselves,” he added.
He stressed that all Cuban provinces have these new forms of management, although nine municipalities have yet to implement them.
Commenting on the central theme of the meeting, the deputy minister said that financing for these forms of management is still a pending task due to the low level of MSMEs that have access to this type of economic resources, while in others, access is conditioned by significantly high interest rates that make personal and family projects unsustainable.
“In our case, we still have a long way to go in terms of financing. Cuba’s exclusion from international financial mechanisms, as an example of the application of the Helms-Burton Act, as well as the country’s own economic situation, makes it necessary to implement different and innovative mechanisms in this area in order to achieve a real insertion of these actors in the country’s social development”.
5,068 applications have been received to set up private, state or cooperative MSMEs.
Speaking at the meeting, Verónica Rives Amaro announced that to date, 5,068 applications have been received to set up private and state-owned micro, small and medium-sized enterprises or cooperatives.
“Of these, 3 074 have been approved (2974 private and 51 state-owned). The most represented sectors are food production, construction and manufacturing”.
Meanwhile, the provinces with the greatest growth in these new forms of management are Havana and Granma.
Citydev, an example of public-private articulation
Among the initiatives presented this Thursday at Pymelab 2022 was Citydev.brussels, an example of public-private articulation based on MSMEs.
Founded in 1974 and renamed as we know it today in 2013, on the eve of its 40th birthday, this state-owned MSME has as its core missions the economic development of the region and urban renewal and mixed projects.
In all these years, the medium-sized enterprise has created 475 companies, with 26,000 jobs. It also has four SME parks and five project incubators.
In the case of urban renewal, Jean-Serge Dias Sousa, Economic and Commercial Counsellor of the Embassy of the Kingdom of Belgium, explained that new housing is created for middle-income households to become homeowners in neighbourhoods characterised by a deficit in residential construction.
“Our aim is to maintain or recover the inhabitants of the Brussels-Capital Region. These various housing projects are carried out thanks to a partnership between the public and private sectors”.
Another of the small private companies present at the event is EMSI FARMA, dedicated mainly to maintenance, automation and engineering services for the Cuban pharmaceutical industry.
Another of the small private companies present at the event is EMSI FARMA, dedicated mainly to maintenance, automation and engineering services for the Cuban pharmaceutical industry.
EMSI FARMA is an example of alliances between the private and state sectors. For example, it has collaborated with pharmaceutical companies such as the Finlay Vaccine Institute and the Immunoassay Centre, which are vital to the national production of medicines.
According to its director, founded in 2016, it has been involved in projects such as the modernisation of a fermenter at the Finlay Vaccine Institute.
Similarly, its members have worked on the automation of the filling line for haemodialysis solution bags at the Empresa de Sueros y Productos Hemoderivados.
This enterprise has been located in Havana’s Science and Technology Park since February 2021.
Financing MSMEs, a long way to go
Accessing sources of financing to obtain the loans needed to start up the projects that are emerging from the new forms of economic management is a real challenge. This was acknowledged by the participants in the Pymelab 2022 workshop.
Among the main concerns that emerged among the participants were the need to continue modernising banking procedures, as well as to achieve greater agility in the granting processes, a fact that in most cases is characterised by delays.
In this sense, Oliesky Fabre del Castillo, partner and president of En paralelo, a private company dedicated to producing micro-vegetables in urban spaces, both indoors and outdoors, said that they have felt accompanied by the Ministry of Economy and Planning.
Although he recognises that their experience in applying for financing to make investments is positive, the necessary agility was not achieved. “We know it is a new experience, but we need capital to start our activities. We need more flexible development policies, and commercial banks should be able to negotiate better with each type of business.
At the same time, he acknowledged that all economic actors need a better economic culture.
Arminda García González, Director of Financiera Iberoamericana S.A., also commented on this issue.
“One of the facts that most delays negotiations with the banks is the lack of accounting knowledge. We have been approached by 138 MSMEs and they have made 69 applications. Of these, only three are at an advanced stage for approval.
In this regard, he acknowledged that it has been a lengthy process that does not favour the performance of MSMEs.
For her part, Aizel Llanes Fernández, director of territorial development at the MEP, stressed the importance of making entrepreneurs aware of all the financing channels that are available at the local level, which can range from the territorial contribution of 1% to international cooperation.