Tuesday, October 20, 2020

SMMEs still face multitude of challenges

The journey towards developing Small, Medium and Micro Enterprises (SMME’s) to become a sector that can diversify the economy continues to be a challenge in Botswana.

The sector is faced with a plethora of challenges that range from lack of business acumen, lack of market, poor quality, land and finance, among other issues.

Over the years, attempts to address these challenges have been made through the Local Enterprise Authority (LEA), but most of the challenges are still lingering. SMMEs play an important role in employment creation, especially for the unskilled and semi-skilled.

The BIDPA (2007) report indicates that SMMEs contribute up to 75 percent of private sector employment and about 20 percent of national output (GDP).

Addressing the SMMEs at the LEA SMME Pitso, Keletso Rakhudu, the Assistant Minister of Trade and Industry, acknowledged that challenges that are still lingering contribute greatly to hindering the sector to becoming vibrant.

“Lack of market intelligence, inadequate marketing and shortfalls in supply capacity are some of the inherent limitations that have contributed to the inability of SMMEs to access local markets,” he said.

Rakhudu said another hurdle hindering the growth of the sector has been that the entrepreneur has averted to dependency as opposed to self-reliance. “This change in mindset has undermined the capacity of the entrepreneur to be enterprising,” he said.

In addition, Rakhudu emphasized the need for mindset change on the part of SMMEs, to dismiss the perception that Government is obliged to procure local products.

“We need to be innovative to be able to produce goods and services which are competitive by international standards in terms of quality, price and availability or delivery period,” he said.
Rakhdu said the SMME sector is one of the most important pillars of economic development in market economies.

“The sector can play a significant role in the transition of natural resources and agriculture-led economies to industrial ones, availing opportunities for processing activities which can generate sustainable sources of revenue and enhance the development process,” said Rakhudu.

Meanwhile, LEA has established programmes and projects to mitigate the occurrence and impact of these hurdles by offering solution-oriented services targeted to both SMMEs and buyers.

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