Against A Virus with the Private Sector

Connecting Business initiative Secretariat • 21 July 2020
Blog in group Turkey

* article by Claudio Tomasi, Resident Representative of UNDP in Turkey

The pandemic created a historic recession with record levels of deprivation and unemployment, creating an unprecedented human crisis that is hitting the poorest hardest, especially women, persons with disabilities and chronic diseases, migrant workers and refugees.

UNDP Turkey has been closely observing and assessing the economic and social effects of the pandemic in Turkey. Since the start of the crises, we have been reprogramming our current activities and developing new partnerships to respond to COVID-19 in all areas of development cooperation, on the basis of new UNDP data dashboards that highlight the countries’ abilities to cope with and recover from the crisis.

We are in an effort to provide guidance to Government, private sector and civil society organizations to apply a resilience lens to recovery policies. To this end, we provide Building Back Better (“Building Back Better” is adopted officially as an approach to post-disaster recovery aimed at increasing the resilience of nations and communities to future disasters and shocks, in the UN Sendai Framework for Disaster Risk Reduction 2015-2030.) type of support to open up towards a low-carbon, inclusive and rights-based economy in line with SDGs. We are calling the action for protecting jobs, businesses and livelihoods to set in motion a safe recovery of societies and economies as soon as possible for a more sustainable, inclusive, gender-equal, and carbon-neutral path—better than the “old normal”.

UNDP’s partnership with the private sector through its platforms namely Business for Goals Platform (B4G) and Connecting Business initiative (CBi) have been exemplary, in terms of having early impact analysis on businesses and development of coordination and collaboration mechanisms in response to crisis management.

In this direction, the first “B4G Survey on Impact of COVID-19 on Enterprises and Needs” was conducted in late March this year. The survey analysed the impact according to scale and sectors of businesses and included questions looking at the impact on women employees. It was also translated and conducted to Syrian-owned businesses.

UNDP has extended its cooperation with other UN Agencies namely, UN Women, UNFPA, ILO and UNIDO with a follow up socio-economic survey, conducted in May, in order to monitor status of businesses who adopted business continuity plans, status of digitalization, regional disparities, gender inequalities and effects on different sectors.

The surveys indicate that, the rate of enterprises which fully stopped operations dropped from March to May, and 39 percent of enterprises reduced their operations. In May, 22 percent of enterprises reported full-stop against 31 percent in March survey. The hardest hit were micro enterprises at 69 percent whereas the rate was 31 percent for large ones.

It was also reported through the survey that, 33 percent of micro enterprises reported serious difficulty in payments, whereas only 2 percent of large enterprises did so. 48 percent of enterprises reported that their working capital could carry them forward at most three months if COVID-19 Crisis continued. 22 percent reported insufficient working capital or would suffice for one month at most.

The survey also revealed that as the domestic and family responsibilities such as childcare increased as the crisis developed, showing that women are more intensely affected by the crisis.

Another reveal was that Syrian-owned businesses are more adversely affected by the Covid-19 crisis. 38 percent of Syrian-owned businesses had to shut down their businesses.

Looking into future, recovery projections of enterprises have changed significantly since March. Those which thought the crisis would impact 2021 and beyond increased from 11 percent in March to 48 percent in May. It was also important to note that 51 percent of MSMEs are not prepared against a second wave. For Syrian-owned enterprises, the rate is 78 percent.

51 percent of MSMEs are not prepared against a second wave.
Enterprises, by their current risk perception, view this crisis as a crisis of domestic and foreign demand, rather than a financial one. Low domestic and foreign demand (contraction in export markets) stood out as areas of risk.

Based on the results of the surveys, we have been organizing various webinars for awareness raising and capacity building of the SMEs. More than 2,500 SMEs and other participants have joined these trainings to date. Several guidelines and tools were made available.

We are also supporting Turkey’s planning, coordination and crisis management capacities. In partnerships with the private sector and Regional Development Agencies, we conduct impact analysis and develop guidelines and strategies for critical sectors in Turkey and provide direct technical support to SMEs. We have also started working to engage Turkish businesses to shift their productive capacities to supply national and global PPE demand.

The impacts of COVID-19 on unemployment is also being analysed and trainings will be conducted for unemployed men and women to improve their digital skills for their employability. The specific needs of the Syrian owned enterprises to improve digital livelihood opportunities will also be addressed as a vital need.

Finally, together with UNIDO and UN Women, we prioritize our action on “Impact Investment”, to address SMEs’ lack of access to finance. Accordingly, we are aiming to create a robust impact investing ecosystem in Turkey paving the way for other impact funds to follow, mobilizing investments to support SMEs.

Photos: Levent Kulu / UNDP Turkey