Infrastructure gap crippling rural SMEs
SHORTAGE of infrastructure and training are some of the major challenges hindering growth and viability of small to medium enterprises (SMEs) in rural areas.
Despite their potential to transform livelihoods, most rural SMES are struggling as they lack basic infrastructure, which limits their contribution to national economic development.
According to data provided by the International Council for Small Business (ICSB) in 2019, formal and informal SMEs make up over 90 percent of all firms globally and account on average for 60-70 percent of total employment and 50 percent of GDP.
In Zimbabwe, SMEs constitute the bulk of businesses and employ close to 60 percent of the country’s workforce while contributing above 50 percent to the country’s Gross Domestic Product.
In an interview in Nkayi on Thursday, Minister of Women Affairs, Community, Small and Medium Enterprise Development, Dr Sithembiso Nyoni, said enhanced training of SMEs and infrastructure support were critical to the sector’s success.
“In rural areas and in Matabeleland North to be specific, there is lack of infrastructure as we know that trained and educated SMEs succeed better than those who are not educated. We’re still struggling to get vocational training centres, which can be used to train people on different skills.”
Rurals areas hold huge potential for SMEs growth as they possess most of the required raw material hence establishing infrastructure in such places will help in reducing cost of transporting products to be processed in urban areas, economists have said.
Dr Nyoni said it is easy to train people on skills like sewing and carpentry but to be successful SMEs there are other requirements like administration, banking and record keeping, which most start-ups lack.
“We can do trainings on other things, but there is need to be backed up by an institution so that they can polish up and maybe get trainings on how to use different machinery. We are grateful that we now have an institution from Ministry of Education, which will help to polish up available skills, but as Matabeleland North we still need more infrastructure, which include clean water, roads and training institutions.” — @SikhulekelaiM1