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Project Title

Marketplaces and MSMEs Formalization in APEC Economies

Project Year

2025

Project Number

SMEWG_207_2025A

Project Session

Session 2

Project Type

Standard

Project Status

Project in Implementation
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Project No.

SMEWG_207_2025A

Project Title

*
Marketplaces and MSMEs Formalization in APEC Economies

Project Status

Project in Implementation

Fund Account

*
APEC Support Fund

Sub-fund

ASF: General Fund

Project Year

2025

Project Session

*
Session 2

APEC Funding

103,759

Co-funding Amount

0

Total Project Value

103,759

Sponsoring Forum

*
Small and Medium Enterprises Working Group (SMEWG)

Topics

Micro, Small and Medium Enterprises

Committee

SOM Steering Committee on Economic and Technical Cooperation (SCE)

Other Fora Involved

Other Non-APEC Stakeholders Involved

 

Proposing Economy(ies)

Chile

Co-Sponsoring Economies

China; Korea; Thailand

Expected Start Date

01/01/2026

Expected Completion Date

30/06/2027

Project Proponent Name 1

Martin Orozco

Job Title 1

Advisor, Inclusive Trade Department, Genderal Directorate of Multilateral Economic Affairs

Organization 1

Undersecretariat for International Economic Relations (SUBREI)

Telephone 1

+56-2 28275572

Email 1

morozco@subrei.gob.cl

Project Proponent Name 2

Not Applicable

Job Title 2

Not Applicable

Organization 2

Not Applicable

Telephone 2

Not Applicable

Email 2

Not Applicable

Declaration

Martin Orozco

Project Summary

This project analyzes the role of digital marketplaces in the formalization of MSMEs across APEC economies, with a gender lens. It continues the E-Formalization study led by ABAC Canada and supported by ABAC Chile, strengthening public-private collaboration between ABAC and APEC. The initiative is designed for implementation in 2026 and applies to the ASF General Fund to optimize funding opportunities.


Using primary and secondary research, the study will explore barriers and enablers to MSME formalization, particularly for women entrepreneurs. A regional workshop will be held in Viet Nam to share results with policymakers, marketplace operators, and stakeholders. Outputs include a data-driven report, communication kit for promotion of the findings, and recommendations tailored to APEC priorities on digitalization and inclusive growth, besides the Project Summary Report.

Relevance

Region

Informality remains a structural challenge in many APEC economies. A study APEC 2024 on informality estimates that within the APEC region, fiscal revenues equivalent to 5.4% of GDP are lost due to informal practices, limiting the capacity of governments to provide public goods and services. These figures explain the high rate of informal employment in the region, which reaches 44.7% and worsens in lower- income economies, exceeding 88%, while in higher-income economies, the rate of informal employment stands at 12.9% of total employment. This affects productivity, access to financing, and the ability of micro, small, and medium-sized enterprises (MSMEs) to scale and compete in formal markets. According to the Lima Roadmap to Promote the Transition to the Formal and Global Economies (2025-2040), the transition from informality to formality is key to inclusive growth and economic integration in the region. Digital marketplaces have emerged as key platforms for the commercialization of goods and services, offering MSMEs access to domestic and international markets. However, the impact of these platforms on formalization remains under-studied, and there are regulatory, technological, and cultural barriers that prevent informal businesses from fully integrating into the formal economy.

This study will address the following key questions:

1. How have digital marketplaces facilitated the formalization of MSMEs in APEC economies?

2. What are the main regulatory and technological barriers that limit this transition? 3.How do gender differences affect formalization through digital marketplaces?


Eligibility and Fund Priorities

The project is eligible for funding from the APEC Support Fund (ASF) as it focuses on capacity building for the formalization of MSMEs through digital marketplaces, addressing regulatory barriers, digitalization, and gender inclusion. Its collaborative approach between the public and private sectors, with cooperation between ABAC and APEC, reinforces its impact on public policy formulation. Additionally, by continuing the e-formalization study from Canada, it contributes to cooperation among APEC economies to generate effective strategies for integrating MSMEs into digital commerce. Furthermore, it will be relevant for APEC economies, especially those in developing stages.


Capacity Building

The project will benefit developing economies where informality affects the growth of MSMEs. Tools and strategies will be provided for their integration into digital marketplaces, facilitating their access to financing, clear regulations, and better market opportunities. This will be achieved through an international workshop focused on capacity building and the exchange of best practices, as well as through the publication of a report with recommendations aimed at contributing to the design and implementation of better public policies for MSMEs in the region. The project is expected to directly inform public policy design in developing APEC economies by offering targeted insights on regulatory reform, digital adoption, and gender-inclusive practices tailored to their contexts. The implementation of this project will bring four benefits to the capacity building:


● Public-Private Collaboration: By involving ABAC and other private-sector stakeholders, the project fosters stronger cooperation to tackle informality and promote MSME growth.

● Policy and Regulatory Capacity: It will build the capacity of government institutions to design effective regulatory and support frameworks that facilitate digitalization and formalization, by helping them understand digital marketplace dynamics, develop or reform regulations to incentivize formalization and harmonize digital and trade policy with inclusive growth objectives.

● Empowerment of Underrepresented Groups: The project builds local capacities to support women, Indigenous Peoples, and rural entrepreneurs through targeted policies, helping economies design inclusive digital literacy and financing programs and equipping public institutions with tools to implement the La Serena Roadmap and APEC’s gender inclusion goals.

Toolkit and Advocacy Resources: The resource kit and advocacy materials will serve as practical tools for ongoing public awareness and institutional capacity development.

Objectives

Analyze the impact of digital marketplaces on the formalization of MSMEs in APEC, identifying enabling factors and regulatory, digital, and economic barriers, with a focus on the gender gap, to generate recommendations and best practices. These will be documented in reports and advocacy materials, which will be presented at an APEC Workshop to promote the digitalization and formalization of businesses in the APEC region. The findings will be disseminated through the workshop, a Research Report (detailing recommendations, best practices for the formalization and digitalization of enterprises), a Project Summary Report, and a resource kit for public advocacy.

Alignment

APEC

The project aligns with APEC, prioritizing the promotion of the digital economy as a tool for the integration and growth of MSMEs in the region. It contributes to the goal of fostering an inclusive and secure digital environment, allowing small businesses to access global markets through digital marketplaces and reduce formalization barriers. The project focuses on the pillar of Innovation and Digitalization, aligning with APEC's objective of strengthening digital infrastructure, accelerating digital transformation, and closing the digital divide. Additionally, it supports inclusive and sustainable growth by promoting the participation of women entrepreneurs. It is also aligned with Putrajaya Vision 2040 that aims to “foster quality growth that brings palpable benefits and greater healthier and wellbeing to all including MSMEs, women and others with untapped economic potential” through “intensifying inclusive human development as well as economic and technical cooperation to better equip our people with the skills and knowledge”. This project aligns with the Policy Partnership on Women and the Economy (PPWE) work plan and the strategic framework of the La Serena Roadmap for Women and Inclusive Growth (2019-2030), specifically promote and facilitate cooperation in the public and private sector to help ensure that women, including women of diverse backgrounds, and women-led micro, small and medium-sized enterprises (MSMEs), can access capital and assets, in both local and international markets. It supports key Roadmap objectives, including improving access to digital tools and technologies, thereby empowering women to become both users and innovators within the technology sector. The project also focuses on building high- demand digital skills, providing women with the tools needed to thrive in the digital marketplace and enhancing their economic empowerment. The project is aligned with the Lima Roadmap to Promote the Transition to the Formal and Global Economies (2025 – 2040) which was endorsed by APEC Economic Leaders in November 2024.

The project is also aligned with APEC Ministerial Statement 2024 as the Ministers mentioned that “We note the importance of enabling MSMEs to transition from informal to formal economy and participate in global economy and to become more competitive and to become more competitive in local, regional and global market”.


Forum

The project aligns with the priorities of the Small and Medium Enterprises Working Group (SMEWG) by addressing the impact of digital marketplaces on the formalization of micro, small, and medium enterprises (MSMEs) in APEC. It contributes to the SMEWG strategy by promoting MSMEs' access to digital commerce, facilitating their integration into the formal economy, and strengthening their competitiveness.

Additionally, the study has a strong focus on reducing gender gaps, analyzing the specific challenges faced by women entrepreneurs in their formalization process through digital platforms. The study's findings will generate evidence and recommendations to improve regulatory frameworks and inform effective public policies that drive the digitalization and formalization of MSMEs.

The Project also aligns with the SMEWG Strategic Plan 2025-2028, specifically with the following objectives: facilitate the transition of informal businesses to the formal economy and promote social enterprise and public-private partnerships; promote entrepreneurship and business development opportunities for those with untapped economic potential, such as women, Indigenous Peoples as appropriate, persons with disabilities, and those from remote and rural communities; ensure access to finance and growth opportunities for MSMEs owned and run by those with untapped economic potential, such as women, Indigenous Peoples as appropriate, persons with disabilities, and those from remote and rural communities; ensure that MSMEs in the APEC region are fully able to participate in trade and that the benefits of globalization flow to all elements of society, including MSMEs; increase MSME digital

transformation, including through digital and business skills development programs and enabling environment; support MSME use of ecommerce.

Beneficiaries and Outputs

Output


1) APEC Research Report (APEC Publication)

A comprehensive research report analyzing the barriers and enablers of MSME formalization through digital marketplaces across selected APEC economies.

The report will include literature review, interviews, surveys (online questionnaires), policy scan, comparative case studies from 4 APEC economies - Chile (sponsor of this project), China (world's largest e- commerce market), Korea (experience with SME formalization through the use of digitalization policies, support for internationalization, and a focus on creating resilient ecosystems) and Singapore (6th APEC economy with the most B2B e-commerce marketplaces) -, evidence-based policy recommendations for promoting digital inclusion and formalization.

The report will be at least 15 pages long (excluding annexes), will include an executive summary, and will be published as an official APEC Publication following the APEC Publication Guidelines.

It will contain the following sections:

I) Executive summary.

II) Introduction.

III) Literature review.

IV) Methodology.

V) Data collection and results.

VI) Comparative case studies.

VII) Policy recommendations.

VIII) Conclusion.

IX) Annexes.


2) Communication Kit (non-videos)

A short and accessible Policy Brief (5–7 pages) summarizing the main findings and policy recommendations from the Research Report. It will be complemented by a Communication Kit (e.g. infographics, summaries) designed to support promotion of the policy recommendations among policymakers, private sector actors, and MSME organizations (2 - 4 pages). All materials will be produced in English and comply with APEC branding and communication standards.


3) International Workshop

A one day international workshop, hosted tentatively in Viet Nam (2027), gathering policymakers, researchers, private sector representatives, and MSME organizations from APEC economies.

The workshop will present the findings from the APEC Research Report, facilitate dialogue and policy exchange on MSME digital formalization. The number of participants it is expected to be, approximately, 40 participants (mix of in-person and online), with at least 30% women speakers and participants. The proceedings and key takeaways will be summarized internally in the Project Summary Report (non-APEC publication).

Potential Agenda:

1) Accreditation (30 minutes).

2) Opening remarks (30 minutes). Hybrid session.

3) Session 1: "Outstanding experiencies from APEC Economies in formalization of MSMEs through digital marketplaces: public and private sectors" (1 hour). Hybrid session.

4) Coffee Break (30 minutes).

5) Session 2: "Launch of the APEC Research Report" (1 hour). Hybrid session.

6) Lunch (1.5 hours).

7) Roundtables for the exchange of experiences between policymakers, researchers, private sector representatives, and MSME organizations from APEC economies (2 hours).

8) Concluding remarks (30 minutes).


4) Project Summary Report

A Project Summary Report (at least 15 pages long excluding annexes) intended for dissemination of the main takeaways of the full project (APEC Research Report and International Workshop). It will contain the following sections:

  1. Executive summary.
  2. Introduction and context.
  3. Main findings of the research report.
  4. Workshop results.
  5. Policy recommendations.
  6. Conclusion.
  7. Annexes.


Outcome

Increased understanding among policymakers and stakeholders of the barriers and enablers to MSME formalization via digital marketplaces. Through the research report and the international workshop, the project will deepen the knowledge of public and private stakeholders on how digital marketplaces influence the formalization process of MSMEs across APEC economies. It will identify and analyze regulatory gaps, digital infrastructure challenges, and enabling policies, all through a gender lens. This will support evidence-based policymaking and promote inclusive digital strategies.


Broader outreach and accessibility of project findings among diverse APEC audiences, including MSMEs and gender-focused organizations. By developing and distributing a Communication Kit, the project will ensure that complex findings are translated into digestible and actionable content. This will broaden the reach of the project beyond technical audiences, increasing awareness and knowledge among MSMEs, women-led businesses, informal workers, and civil society actors who play a critical role in advancing digital inclusion.


Enhanced cross-economy collaboration and policy dialogue on digital inclusion and MSME formalization. The International Workshop will serve as a platform to foster cooperation between government agencies, digital marketplace platforms, academia, and civil society organizations across APEC economies. It will promote the exchange of experiences, validate policy recommendations, and strengthen networks that contribute to long-

term regional efforts to advance MSME digitalization and formalization.


Beneficiaries

Direct beneficiaries: Governments and policymakers, from public institutions related to Economic Development, formalization of SMEs and their positioning ininternational markets, Digital trade and Gender-focused trade (e.g Ministries of Economy, Finance and/or Treasury, entrepreneurship and innovations agencies, foreign economic affairs agencies/Ministries), and the respectives ecosystem to support MSMEs, from the APEC economies. This beneficiaries will obtain evidence and recommendations for the development of public policies to promote formalization and continuous regulatory improvement. They will also benefit from the learning gained regarding the nature and application of an effective instrument to combat informality.

The level of seniority desired for the participants is from mid-level (specialist, associate) to senior-level (senior specialist, lead).

Additionally, ABAC and other public-private actors identified through the comprehensive research described in the Outputs, will be able to promote effective strategies based on the study's findings. Desirable industries are those characterized by a high level of informality, but also those best suited to transacting their goodsand services on digital marketplace platforms (e.g. trade, accomodation, among others). To identify and contact the relevant stakeholders we want to reach in the implementation of this project, we will rely on the focal points of the SMEWG group, particularly those from the economies that co-sponsor the study.

Indirect beneficiaries: MSMEs in developing economies will receive concrete strategies to formalize through digital commerce. Digital marketplaces will be able to optimize their mechanisms for including MSMEs.

Dissemination

The results of the project will be disseminated through multiple channels to ensure broad visibility and impact across APEC economies:


Official Publication: A Research Report will be published as an APEC publication in accordance with APEC guidelines.


Website Publication: The Research Report and related materials will be shared through the APEC website and the website of the Undersecretariat of International Economic Affairs of Chile (SUBREI).


Project Summary Report: main takeaways of the full project will be summarized in this document, which will be shared internally.


International Workshop: results contained in the Project Summary Report will be presented at an international workshop organized during the final phase of the project.


There is no intent to obtain monetary benefit from this Research Report.

Gender

Please see Project Proposal in Supporting Documents folder.

Work Plan

Please see Project Proposal in Supporting Documents folder.

Risks

Please see Project Proposal in Supporting Documents folder.

Monitoring and Evaluation

Please see Project Proposal in Supporting Documents folder.

Linkages

This project will seek to promote collaboration within APEC, among the working groups SMEWG, PPWE (Policy Partnership on Women and the Economy), and DESG (Digital Economy Steering Group). Additionally, it will aim to work and collaborate with APEC stakeholders, including ABAC, PECC, among others; as well as with other international public and private agencies and organizations linked to the digital and e- commerce ecosystem, the labor market, gender initiatives, the promotion of MSMEs, and the promotion of business formalization. The project aims to significantly

contribute to strengthening the ties and joint work between APEC and ABAC, with whom the results and findings of the study will be shared.

Sustainability

The project has been designed with long-term sustainability in mind, ensuring that its outputs—especially the research report, policy recommendations, project summary report and communication materials—continue to be used and have impact beyond the completion date of the project.


1. Institutional uptake and policy use:

The research report, project summary report and policy recommendations will be disseminated across APEC forum such as SMEWG and other interested ones, where they will inform future agendas and policymaking. Specific engagement with economy representatives during the workshop will be used to encourage uptake of findings into domestic strategies for MSME formalization and digital inclusion.


2. Reusability of materials:

The Communication Kit will be designed for long-term usage by economies and partner organizations (e.g. other APEC working groups or committees, beyond the SMEWG, that are engaged in matters concerning formalisation, online marketplaces, or MSMEs; institutions within each APEC economy that form part of the MSME support ecosystem). The gender-sensitive content will be uploaded to permanent platforms such as the APEC website, and partner channels (Allies, MSME networks, others).


3. Foundation for follow-up initiatives:

This project will establish a knowledge and stakeholder base that can be leveraged for future APEC projects, including capacity-building activities focused on digital formalization, marketplace regulation, or AI and MSME inclusion. The gender approach will also serve as a blueprint for future gender-responsive research across APEC.


4. Public accessibility and open data (when feasible):

Subject to APEC guidelines, anonymized data and key findings may be made available as open datasets to promote further academic and policy analysis.

Direct Labour

Please see Project Proposal in Supporting Documents folder.

Are there any supporting document attached?

Yes
Project No.
Project Title
Project Status
Fund Account
Sub-fund
Project Year
Project Session
APEC Funding
Co-funding Amount
Total Project Value
Sponsoring Forum
Topics
Committee
Other Fora Involved
Other Non-APEC Stakeholders Involved
Proposing Economy(ies)
Co-Sponsoring Economies
Expected Start Date
Expected Completion Date
Project Proponent Name 1
Job Title 1
Organization 1
Telephone 1
Email 1
Project Proponent Name 2
Job Title 2
Organization 2
Telephone 2
Email 2
Declaration
Project Summary
Relevance
Objectives
Alignment
Beneficiaries and Outputs
Dissemination
Gender
Work Plan
Risks
Monitoring and Evaluation
Linkages
Sustainability
Direct Labour
Are there any supporting document attached?
hdFldAdmin
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Secretariat Comments
Reprogramming Notes
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Endorsement By Fora
PD Sign Off
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Monitoring Report Received
Completion Report Received
PMU Field 1
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Content Type: Standard Proposal
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