Philippines steps up push for MSMEs to adopt AI

By Edg Adrian A. Eva, Reporter

THE Philippine government is intensifying efforts to help micro, small and medium enterprises (MSME) adopt artificial intelligence (AI), as most remain slow to embrace the technology despite widespread computer ownership and internet access.

Only 14.9% of local firms use AI tools, according to a September study by the Philippine Institute for Development Studies.

The report cited data from the Philippine Statistics Authority showing that 90% of companies own computers and 81% have internet connections, suggesting that the challenge lies in digital readiness rather than access.

The Department of Science and Technology (DoST) said several initiatives are under way to close this gap and help small firms integrate AI into their operations.

“We have been funding many MSMEs, some of which already use AI in their work,” DoST Secretary Renato U. Solidum, Jr. told BusinessWorld on the sidelines of the National AI Stakeholders Conference last week.

“Even those that need it in sari-sari (mom-and-pop) stores or school management systems, we already have that,” he added.

Mr. Solidum said the agency launched the Advancing Computing, Analytics, Big Data and Artificial Intelligence in the Philippines project this year to make AI tools more accessible across industries.

The program supports the development of local AI applications including iTanong, an AI system that can converse in Filipino, English, or Taglish and can be integrated into government services.

He noted that through the program, they want to make sure that MSMEs can benefit from AI tools without needing large-scale infrastructure or high costs.

Michelle Alarcon, president of the Analytics and AI Association of the Philippines (AAP), said the government should provide incentives for MSMEs to adopt AI, starting with digitizing their data. Many small firms could not use AI because their data are still not digitized, she added.

AAP has launched upskilling programs with the Department of Trade and Industry and Technical Education and Skills Development Authority to train workers in using AI tools and analytics.

“We want them to know about AI,” Ms. Alarcon said in mixed English and Filipino. “This way, when they get employed by a small business or decide to set up their own, they will already know how to use it.”

The Department of Information and Communications Technology (DICT) is also working to expand internet connectivity to support small enterprises in far-flung areas.

DICT Assistant Secretary Luis Miguel B. Planas said satellite broadband units have been deployed in geographically isolated and disadvantaged areas using low-orbit systems such as Starlink.

The DICT has established 19,000 free Wi-Fi sites nationwide and aims to expand that to 30,000 by year-end and 70,000 by 2026.