Big plans for small businesses
STARTING SMALL: An exhibitor showcasing products

Govt commits to provide conducive environment for SMEs

Permanent Secretary in the Ministry of Investment, Trade and Industry (MITI), Peggy Serame says government is fully committed to the creation of a conducive environment for the Small, Micro and Medium Enterprises (SME’s).

Small businesses are reportedly some of the most disadvantaged enterprises, facing a range of challenges such as lack of access to funding and unavailability of markets for their products and services.

Speaking at the launch of the new Local Enterprise Authority (LEA) strategy, Serame said government wants to see small businesses becoming competitive and sustainable.

SMEs are believed to have a potential to address many challenges that the economy is facing such as unemployment, low production capacity, high import bill and undiversified economy.

And by empowering it, some o these challenges can be history, according to Serame.

The new LEA strategy seeks to further empower the SMMEs sector in order for them to play a critical role in the economy.

A study by Botswana Institution for Development of Policy Analysis (BIDPA), had in the past found that small firms in Botswana are exposed to competition from imports from South Africa, China and other countries as a result of free trade, meaning that only competitive firms are the only ones that survive.

Although there is some form of protection under the Southern Africa Customs Union (SACU), local small businesses’ biggest threat is said to be imports from South Africa.

In his presentation of the strategy recently, LEA Chief Executive Officer, Dr Racious Moatshe called for strategic partnerships with relevant institutions in order for the Authority to fully implement its strategy to empower the SMMEs.

These include financiers, capacity building and training institutions, markets and regulators amongst others.

In yet another previous study, BIDPA had discovered that 70 percent of the SMME’s fall within the first one and half years of operation.

This is because of a mixture of challenges such as lack of finance, poor work ethics and limited managerial skills as well as lack of business acumen.

Though economists say there is no data available on the SMMEs in Botswana and their contribution to the economy, it is estimated that the sector employs over 120, 000.

Research by various institutions indicates that given the crucial role they play in economic development, it is increasingly being acknowledged that globalization has increased both opportunities and challenges.

A study by BIDPA says the ability of the SMMEs to compete in global markets depend on their access to critical resources such as finance, technology and managerial skills.

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