Rising globalization and economic integration have enabled SMEs to increase their contributions to the region’s development through greater participation in global production chains (GPCs). More and more SMEs are engaged in activities that link up with multi-national corporations, providing intermediate goods or services that are used to build the final products. SMEs’ participation in GPCs yields substantial benefits; however, currently the level of SMEs participation in GPCs is still quite low.
To enter and to stay in GPCs require SMEs to overcome various challenges, such as finance, human resources, global standards, and changing international business practices. APEC Governments can play a supporting role to facilitate the gainful participation of SMEs in GPCs: (i) provide an enabling business environment for SMEs; (ii) improve access to financing for SMEs; (iii) strengthen (global) cooperation and network among SMEs as well as between MNCs and SMEs; and (iv) increase knowledge of SMEs about FTAs.