$22m boost for SMEs

Chronicle (Zimbabwe) - - Business Chronicle - Mid­lands Cor­re­spon­dent

THE Gov­ern­ment has mo­bilised $22 mil­lion to fi­nance Small to Medium En­ter­prises (SMEs), which will be ac­cessed through the Small En­ter­prises De­vel­op­ment Cor­po­ra­tion (Sedco), a Cabi­net Min­is­ter has said.

Speak­ing dur­ing a tour of small busi­nesses in the Mid­lands on Thurs­day, Small to Medium En­ter­prises and Co-op­er­a­tive De­vel­op­ment Min­is­ter Cde Sithembiso Ny­oni said Trea­sury would soon avail $15 mil­lion to small busi­nesses while the Arab Bank for De­vel­op­ment in Africa (BADEA) would in­ject $7 mil­lion to those in the man­u­fac­tur­ing and other pro­duc­tive sec­tors of the econ­omy.

“Sedco is look­ing for up to $15 mil­lion that’ll be availed by the Gov­ern­ment and we want to make sure that it’s distributed mainly to the pro­duc­tive sec­tor and value chains. We want peo­ple that are in man­u­fac­tur­ing as op­posed to cross bor­der traders who take the money out of the coun­try,” she said.

Min­is­ter Ny­oni said the Gov­ern­ment has ap­plied for $7 mil­lion from BADEA, which has since been ap­proved and would be chan­nelled to stim­u­late growth in small busi­nesses.

She said: “We’ve money which we got through BADEA which will be used to sup­port SMEs in pro­duc­tion, farm­ing, con­struc­tion and man­u­fac­tur­ing. We’re still sourc­ing fund­ing from other part­ners. This is why I’m mov­ing around (the prov­inces) to make sure that when that money comes, we are fund­ing peo­ple that are grounded in busi­ness.”

The tour saw the min­is­ter vis­it­ing com­pa­nies among them Nyan­gara Steel En­gi­neer­ing, Mid­lands Metals, Zim­build Prop­er­ties and As­so­ci­ated Busi­ness Units, which are sub­con­tracted by Bata to make shoes on be­half of the shoe man­u­fac­turer.

Speak­ing on the side­lines of the tour, Zim­babwe Cham­ber for Small to Medium En­ter­prises (ZCSMEs) deputy sec­re­tary gen­eral, Mr Rab­son Hove, said three pil­lars — cap­i­tal­i­sa­tion of SMEs, pro­vi­sion of work spa­ces and sys­tems of train­ing should be put in place to en­sure the growth of the sec­tor.

“What has stag­nated the growth of SMEs is the lack of cap­i­tal as banks are not will­ing to give us money to grow our busi­nesses which makes it dif­fi­cult to for­malise,” he said.

“The tax regime in the coun­try also makes it dif­fi­cult for SMEs to com­ply be­cause they are puni­tive. We have en­gaged the Min­is­ter of Fi­nance (Pa­trick Chi­na­masa) so that he low­ers the tax regimes for SMEs so that they can freely com­ply. For in­stance a hair salon is ex­pected to pay $1 500 in pre­sump­tive tax ev­ery quar­ter and no one in his/her mind would want to com­ply.”

A re­search by the World Bank has vin­di­cated the Zim­stat find­ings as it shows that over five mil­lion of the 13 mil­lion Zim­bab­wean pop­u­la­tion is em­ployed in the in­for­mal sec­tor. — @lavuzi­gara1

Newspapers in English

Newspapers from Zimbabwe

© PressReader. All rights reserved.