Government focuses on boosting SMEs

The government said its focus was to increase the contribution of small and medium enterprises (SMEs) to the national economic growth by addressing challenges that impede the growth of small businesses.

Finance and Economic Affairs Minister William Mgimwa (pictured in forefront with black tie) said researches have concluded that SMEs were the catalysts of economic growth and social well being of citizens.

“Contribution of SMEs to GDP in some economies like India is about 60 per cent…we are working on the bottlenecks to attain that level of contribution (from our SMEs) too,” he said.

Dr Mgimwa cited the establishment of the Dar es Salaam Stock Exchange’s Enterprises Growth Market (EGM) that caters mainly for SMEs as among the government efforts to create conducive environment for small businesses to thrive.

The minister was launching the nine-month education and awareness campaign for the EGM that is expected to unlock SME growth potentials by easing their access to credit facilities at affordable interest rates.

“The EGM is the appropriate market to secure a relative cheap capital for small businesses...there is no way one can do less than that,” Dr Mgimwa said. 

Capital Markets and Securities Authority (CMSA) Chief Executive Officer Nasama Massinda said after the DSE main market existed for over a decade, the authority went back to the drawing board to lessen the listing rules to accommodate SMEs.

“After looking at various experiences of a number of stock markets operations, we came to a conclusion that there was need to have such market to nurture small businesses in the country,” Ms Massinda said.

Tanzania Private Sector Foundation Executive Director Godfrey Simbeye underscored the need for the government to clearly demarcate some percentage to the SMEs especially on the public procurement.

“To begin with, the government could set aside at least 40 per cent of the (government) procurement budget to SMEs...this way our small businesses will be empowered,” Mr Simbeye said.

DSE Chief Executive Officer Moremi Marwa said the campaign hinges on the bourse’s role of offering the required long-term financing to identify feasible projects from small businesses and start-ups.

“DSE appreciates SMEs as the key vehicle for wealth creation, with huge potential to contribute to real economic growth. 

“Even before the campaign, we have received applications from three firms seeking to raise capital through EGM…this shows that some have already started seeing the potential of accessing funds,” Mr Marwa said.

There are about three million Micro, Small and Medium Enterprises in the country that employ over five million people.

Source: Daily News,