In an effort to demolish hurdles impeding citizen participation in the economy, the revised guidelines by the Citizen Entrepreneurship Development Agency (CEDA) promise to ease borrowing by providing extended periods of loan repayments.
The CEDA Board Chairman Dr Alfred Tsheboeng has said the revised guidelines, with a number of added incentives for sectors that aid economic transformation, offer Batswana an opportunity to engage in entrepreneurship as an alternative to formal employment.
He said clients should take advantage of the changes to engage in businesses that will add impetus to the government transformational agenda.
“The development of the guidelines could not have come at a more needy time given the COVID-19 pressures for domestic production and less dependence on imports,” said Tsheboeng.
He further spoke of the changes in loan limits, loan tenure and interest rates as well as changes in equity funding. He said for special sectors (currently manufacturing, mining, energy, construction, technology & innovations, agriculture, creative industry and tourism) and as may be selected by the board from time to time, an interest equivalent to prime lending rate of 5.75 percent minus 3 percent equals 2.75 percent will be charged.
Dr Tsheboeng said in line with common practice, CEDA will charge fees for certain services it renders in order to effect partial cost recovery. He added that the Board of Directors from time-to-time will determine the quantum of fees.
“No fees will be charged on micro and small loans. Security requirements will be discounted for People with Disabilities (PWDs), women and youth across all loan classifications,” said Tsheboeng.
The Minister of Investment, Trade and Industry, Peggy Serame, said CEDA guidelines were revised as a result of a manufacturing study which was carried out in 2019. She said through the manufacturing study, CEDA assessed investment opportunities in the manufacturing sector in Botswana with a view to ensure full exploitation by entrepreneurs.
She said the manufacturing study recommended a transformational approach which was the defining factor in the revision of CEDA Guidelines of 2008. Serame stated that it is envisioned that the revised Guidelines will increase citizen participation in key sectors.
“As Ministry of Investment, Trade and Industry we will continue to improve the doing Business Environment and promote investment and development of sustainable industries,” said Serame.
She is of the view that the revised CEDA Guidelines will go a long way in providing the requisite platform for development of sustainable SMME’s and diversification. She believes that this will indeed promote inclusivity and bring us closer to realizing our national vision of a diversified, knowledge based high income country by 2036.
“We are therefore confident that with the relaxation of CEDA funding requirements, we will see development of the private sector resulting in a significant growth in start-ups investment in new areas and exploit value chain in all sectors, whilst taking advantage of the opportunities presented by the 4IR and Covid-19 response strategies.
Serame stated that implementation of the guidelines would transform SMMEs, culminating in creation of the much-needed jobs for the citizenry
She said that can only happen with support from relevant entities such as the Local Enterprise Authority (LEA) through their entrepreneurship development proficiencies and the Botswana Bureau of Standards with their quality assurance expertise, combined with implementation of the regulations of the Trade and Industrial Development Acts.