FOUR out of every 10 micro, small and medium enterprises (MSMEs) never reopen after a major disaster, underscoring the need for businesses to adopt continuity plans and invest in disaster preparedness, the Department of Trade and Industry (DTI) said.
Speaking at the National MSME Resilience Forum in Cebu on Thursday, July 23, 2026, Leonila T. Baluyut, DTI Assistant Secretary for Regional Operations Group, said international data show that 40 percent of small businesses permanently close after a major disaster, while another 25 percent cease operations within a year, highlighting the sector’s vulnerability to natural hazards.
“The greatest risk to our MSMEs is no longer the disaster itself. It is facing the next one unprepared,” Baluyut said.
She said the Philippines’ exposure to typhoons, earthquakes and volcanic eruptions makes resilience a business imperative rather than an option.
The Philippines ranked first globally in disaster risk under the 2024 World Risk Index. About 20 tropical cyclones enter the country’s area of responsibility annually, while its location along the Pacific Ring of Fire leaves communities and businesses exposed to earthquakes and volcanic activity.
For enterprises, these hazards often translate into damaged facilities, interrupted operations, broken supply chains and lost income.
MSMEs account for 99.63 percent of all registered businesses in the country and provide 65.1 percent of total employment, making them a critical pillar of the Philippine economy.
Despite their economic contribution, Baluyut said smaller firms typically have limited financial reserves and less access to financing, making recovery more difficult after disasters.
She urged MSMEs to treat disaster preparedness as a long-term business investment rather than an added expense.
“Our focus can no longer be solely on recovery,” she said. “Business continuity planning, risk reduction and preparedness are not additional costs. They are investments that safeguard livelihoods, strengthen communities and ensure businesses continue serving their customers even during difficult times.”
Philippine Chamber of Commerce and Industry (PCCI) vice president for MSMEs Melanie Ng echoed the call, saying disasters can quickly erase years of investment for small businesses.
“A single flooded store, a disrupted supply chain, or a week without power can mean the difference between keeping the doors open or closing them forever,” she said.
Ng said resilience should become part of everyday business strategy instead of being treated as an emergency response.
She added that PCCI, through its network of 131 local chambers of commerce and industry, will continue promoting business continuity planning, disaster preparedness and climate adaptation among enterprises nationwide.
Cebu Gov. Pamela S. Baricuatro, in a message delivered by Cebu Provincial Disaster Risk Reduction and Management Office head Col. Dennis Pastor, said the closure of MSMEs after disasters extends beyond business losses.
“When an MSME closes because of a disaster, it is not just income that is lost; it is opportunity and the future of many families,” the governor said.
She said local governments and the private sector must work together to ensure businesses are equipped not only to recover from disasters but also to prepare for future disruptions, helping strengthen local economies and protect livelihoods. / KOC