| Abstract: |
The Association of Southeast Asian Nations (ASEAN) small and medium
enterprises (SMEs) are under scrutiny for their engagement in production
networks following recent emphasis on increasing intra-regional trade,
rebalancing, and inclusive growth in Asia. Using a data set covering 5,900
firms in five ASEAN economies at different stages of development, this paper
analyses the participation of SMEs in production networks, determinants, and
policy implications. It finds that although large firms dominate production
network engagement in ASEAN economies, there are signs that SMEs have modestly
increased their participation since the late-1990s. This is linked to
firm-specific factors (e.g., firm size, foreign ownership, skills,
technological capabilities, and access to credit) as well as a supportive
business environment. Tackling residual supply-side and policy constraints can
further the participation of ASEAN SMEs in production networks. |