BOOST FOR SMEs VP Mnangagwa launches $90m funding package
VICE President Emmerson Mnangagwa yesterday launched a $90 million funding package aimed at capacitating various upcoming businesses across the sectors and help formalise their operations to ensure they contribute to the economy.
The effort comes as the Government enhances efforts to stimulate economic growth through small to medium enterprises.
The $90 million package was facilitated by the Reserve Bank of Zimbabwe and will be administered by the Ministry of Small to Medium Enterprises and Cooperative Development in collaboration with various financial institutions.
Of the $90 million facility, $10 million will go to horticulture, $15 million to cross border traders, $40 million for the gold facility, $15 million for wwomen empowerment while $10 million has been earmarked for business linkages.
The launch, held under the theme “Promoting Financial Inclusion for Micro, wSmall and Medium Enterprises and Cooperative Development”, was attended by representatives of SMEs from different sectors, bankers and senior Government officials.
In his address, VP Mnangagwa said the funding package will complement several policy intervention measures such as ZimAsset and the Ten Point Plan for sustained economic growth and the country’s industrialisation policy whose over-arching goal is to ensure the rapid transformation of the economy.
“As Government, we recognise the critical role played by the MSMEs and cooperatives in addressing the issue of poverty reduction, job creation and income generation,” said VP Mnangagwa.
“That is why the Ministry of SMEs and Cooperative Development, in collaboration with the RBZ have organised this important launch in order to avail funding facilities for the identified five sub-sectors.”
VP Mnangagwa said the SMEs sector had grown to become the bedrock of economic growth, as most retrenchees and graduates had been absorbed and were stimulating development.
“Given the potential contribution that MSMEs and cooperatives can make to the Zimbabwean economy, it is important that they be provided with the necessary tools to ensure that they grow into large entities that can further provide decent jobs, contribute to the alleviation of poverty, and address economic inequalities in our societies,” he said.
VP Mnangagwa said despite their significance, micro, small and medium enterprises continued to struggle to acquire funding and knowledge on financial inclusion.
“While the availability of funding has been improving, access to the same, especially by MSMEs and cooperatives, has been elusive because the funds are too expensive,” he said. “Moreover, MSMEs remain largely informal and, therefore, considered risky business.”
Through Command Agriculture, said VP Mnangagwa, the Government had demonstrated how access to capital and proper business planning and implementation could enhance production and efficiency.
“We will also be launching the Command Livestock on Tuesday, which will include beef, goats, fisheries, chicken and sheep among others,” he said.
Speaking at the same occasion, Small to Medium Enterprises and Cooperative Development Minister Sithembiso Nyoni said SMEs had become the biggest provider of jobs.
She said Government scaled up its support for the sector to enhance increased production.
Minister Nyoni urged entrepreneurs to be disciplined and comply with the requirements of financial institutions.
RBZ Deputy Governor Dr Jesimen Tarisai Chipika urged SMES to deposit their sales in bank accounts.
She said the central bank will soon roll out banking agents in unserviced remote areas.
“We already have 400 access points,” said Dr Chipika. “We want SMEs to be in the mainstream of the economy. As SMEs we must be prepared to be formalised, otherwise banks will collapse because it would be difficult to trace you.
“We cannot give money to people of no fixed abode.”