MSMEs said to be losing markets, opportunities due to delays in getting FDA permits

An advocate of micro, small and medium enterprise (MSME) development has highlighted the particular challenges MSMEs in the food industry face in getting the mandatory license to operate (LTO) and certificate of product registration (CPR) from the Food and Drug Administration (FDA), a situation she said hinders the industry’s growth and potentials.

Renea Tan, a consultant with the Philippine Center for Entrepreneurship (PCE) whose advocacies include Go Negosyo, said in a presentation that one of the major issues of MSMEs in the food sector is the burden of regulatory compliance.

“The bulk of our MSMEs in the whole country are into food industry, and the bottleneck is always FDA,” Tan said, who spoke at the AIM’s “Cutting Red Tape and the Cost of Regulatory Compliance for Small and Medium Enterprises” business forum on November 28.

She added: “We talk of lost opportunities, lost markets for lack of that CPR and that LTO. So we talk of these things and we try to do what we can to assist, but at the end of the day the most we can do is just to provide mentorship.”

She also noted how online shopping platforms have become an attractive venue for small entrepreneurs to access markets, but she said PCE consistently reminds them “to work on these [compliance] requirements however hard it is.”

Asked when she thinks the situation will improve for MSMEs, Tan said, “As to the question when there will actually be progress in the speed of processing of the FDA-issued licenses, then only time will tell.”

Tan also commented that MSMEs in the food industry based in the provinces have even more pressing concerns: “I can see that the bigger problems are for the micro and small entrepreneurs in the countryside because it turns out that the processing of the FDA permits are all centralized so all their applications would still have to be sent to the central office in Alabang and they [FDA] have just one or two officers per province and there are hundreds of applicants per province.”

Tan said they have asked the FDA to explain and “they say that they have a business plan for hiring more employees but it is yet to be really implemented.”

In February this year, PHILEXPORT News and Features reported that FDA said it was already taking measures to address the backlog in the processing of applications for LTOs and CPRs.

The report quoted Oscar Gutierrez Jr., chief at Policy Dissemination and Training Division, as attributing the delays in securing LTOs and CPRs to the limited number of evaluators and inspectors, as well as outdated information technology (IT) infrastructure.

To address the backlog, Gutierrez said the FDA had submitted its proposal for additional inspectors and evaluators to the Department of Health/Department of Budget and Management.

Gutierrez further said that while the FDA had streamlined LTO and CPR requirements and was implementing digital processing, it needed to further update its IT infrastructure.

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