The country that wants entrepreneurs but punishes them for trying

“Ang hirap mag-negosyo sa Pilipinas.”

The words were delivered by a micro, small and medium enterprise owner during a Senate hearing. There was nothing polished about the statement, no complicated economic language, no carefully rehearsed presentation, no attempt to soften the truth. Yet it probably expressed what thousands of Filipino entrepreneurs have wanted to tell the government for years.

It is difficult to do business in the Philippines.

Not because Filipinos lack ideas. Not because we are afraid of hard work. Certainly not because we lack the courage to take risks. Filipinos build businesses from kitchen tables, borrowed capital, personal savings, and sometimes the last remaining balance on a credit card. We sell food online, open neighborhood cafés, manufacture local products, offer professional services, and turn modest skills into livelihoods.

What makes entrepreneurship difficult is that, after taking all those risks, the small business owner often discovers that the system is not designed to help a business survive. It is designed to demand from it.

The government celebrates entrepreneurs during trade fairs and MSME Week. We are photographed beside ribbons, booths and locally made products. We are repeatedly called the “backbone of the economy.” But once the speeches are over, the entrepreneur returns to permits, taxes, accounting requirements, inspections, rising rent, costly electricity, mandatory contributions and paperwork that seems to multiply every year.

The contradiction is painful. The country says it wants more businesses, but often treats people who start them as potential violators before recognizing them as partners in development.

According to the Department of Trade and Industry, MSMEs account for 99.63 percent of the country’s registered business establishments. The government’s own MSME Development Plan says they generate more than 5.6 million jobs, or roughly 65 percent of total employment. These are not peripheral players. They are the Philippine economy in its most human form: the bakery opening before sunrise, the neighborhood store extending credit, the small contractor hiring local workers, the home-based producer supporting a family, and the café giving young people their first jobs. DTI, MSME Development Plan 2023–2028

But we continue to romanticize small businesses without confronting what it takes to keep one alive.

As a business owner, I have learned that revenue is not income. A busy day does not necessarily mean a profitable day. The cash entering the register already belongs to many people: employees, suppliers, landlords, utility companies, delivery providers and the government. Whatever remains must keep the business operating tomorrow.

Sometimes nothing remains.

Yet the obligations do not pause when customers stop coming. Rent is still due. Salaries must still be paid. Electricity charges continue to arrive. Government deadlines remain fixed. One delayed payment can attract a surcharge. One incomplete document can hold up a permit. One unexpected equipment failure can erase weeks of earnings.

Large corporations can employ accountants, lawyers, compliance officers, human resource departments and government-relations specialists. A microenterprise owner may be all of them at once—while also purchasing supplies, answering customers, solving staffing problems and finding enough money for the next payroll.

The law may impose the same deadline, but the burden is not equal.

For a large company, compliance is a department. For a small business, compliance can consume the owner.

This is what policymakers frequently miss. The cost of regulation is not limited to the fee printed on a government form. It also includes the hours spent lining up, travelling between offices, correcting inconsistent requirements, navigating digital systems that do not communicate with each other, and paying professionals simply to understand what must be filed.

Time is capital. Every day an entrepreneur spends chasing a signature is a day not spent improving a product, finding customers or creating another job.

The World Bank has identified three persistent obstacles confronting Philippine small enterprises: starting and maintaining a business, paying taxes and accessing finance. More recent analysis continues to emphasize that supporting SMEs requires reducing regulatory burdens and improving access to credit, logistics and investment. SMEs already account for approximately 63 percent of Philippine employment while contributing only about 36 percent of gross value added. That gap should concern us. It suggests that our small businesses employ millions but remain constrained from becoming more productive, more competitive and more profitable. World Bank

Access to capital remains particularly cruel. The business that most needs affordable financing is usually the least likely to qualify for it. Banks ask for collateral, lengthy records and financial statements that many beginning entrepreneurs do not yet possess. The result is that some business owners turn to personal loans, informal lenders or credit arrangements carrying interest rates that consume future earnings before those earnings are even made.

We tell entrepreneurs to grow, but deny them the oxygen needed for growth.

Then there is electricity. In Iloilo and many other parts of the country, businesses must contend not only with expensive power but also with interruptions that damage equipment, spoil inventory and stop operations. A large establishment may afford industrial generators and backup systems. A small café, tailoring shop, salon or food processor often cannot. When the power disappears, revenue disappears with it—but wages, rent and loan payments do not.

The entrepreneur absorbs every failure of public infrastructure.

Bad roads become higher delivery costs. Port congestion becomes delayed inventory. Unreliable internet becomes lost transactions. Flooding becomes damaged property. Brownouts become spoiled products. Slow government processing becomes additional rent paid while a business waits to open.

The small business owner is expected to remain resilient through all of it.

But resilience should never become an excuse for institutional neglect. Filipinos have been praised for resilience so often that it has become a convenient way of transferring responsibility from systems to individuals. When entrepreneurs survive despite broken processes, government congratulates them. When they close, we quietly blame poor management.

Perhaps the better question is: How many potentially successful businesses have we allowed the system to exhaust?

The solution is not another ceremonial program, motivational seminar or livelihood package released for publicity. Entrepreneurs do not merely need to be inspired. They need government processes that recognize the actual size and capacity of their businesses.

Microenterprises should have genuinely simplified tax and reporting requirements. National agencies and local governments must share information so entrepreneurs do not repeatedly submit the same documents. Business portals must function as real one-stop systems, not digital front doors leading to the same fragmented offices. Permits should have clear requirements, predictable timelines and publicly accountable processing standards.

Regulation must also be proportional. A business employing three people cannot reasonably carry the same administrative architecture expected of a corporation employing three thousand. Compliance must protect workers, consumers and the public, but it should not become so complex that remaining informal appears easier than becoming legitimate.

Government financing must also be redesigned around the realities of small businesses. Credit programs should be accessible before an enterprise becomes successful—not only after it has already accumulated the records, assets and collateral proving that it no longer desperately needs assistance. We need cash-flow-based lending, wider credit guarantees and financial products that understand seasonal and emerging enterprises.

Most importantly, policymakers must stop developing MSME policies without listening seriously to MSME owners.

Not only the successful founders invited to conferences, but also the operator behind on rent, the producer waiting months for a registration, the employer struggling to make payroll, and the entrepreneur who followed every requirement and still discovered that compliance alone could consume the business.

“Ang hirap mag-negosyo sa Pilipinas” should not be dismissed as the frustration of one business owner. It is a warning from the sector carrying most of the country’s enterprises and millions of its jobs.

Filipino entrepreneurs are not asking the government to guarantee our success. Business will always involve uncertainty, competition and the possibility of failure. We understand that. We accepted those risks the moment we invested our savings and attached our names to our ventures.

What we are asking for is a fair chance.

A chance to spend more time building than complying. A chance to access capital without surrendering the future of the business. A chance to operate without being crushed by inefficient systems and unpredictable costs. A chance to create jobs without being punished for daring to begin.

If MSMEs truly are the backbone of the Philippine economy, then government must stop adding weight to that backbone and wondering why it is beginning to break.

About the Author: Janvie Soqueña Amido is a social development leader, entrepreneur and business consultant based in Iloilo City. He writes Beyond the Numbers, a column examining business, development and the realities behind public policy. He may be reached at itsjanvie@gmail.com.