smes budget 3.jpgPlayers in the small to medium scale sector have called upon government to further enhance support for industry in the mid-term fiscal review as the sector has not realised full benefits of funds allocated in the 2010 budget.

 

With only a few days to go before the Finance ministry presents the mid term fiscal review on the 15th of this month, emerging business people have called upon government to aid manufacturers in the sector.

 

Small to medium scale entrepreneur Mr. Evans Kurangwa who makes carpets said liquidity constraints and access to loans are the key issues which the mid-term budget should address, sentiments which were also echoed by Mr. Tatenda Mudakureva an accountant with an SME who called for government to capacitate banks to give loans.

 

Mr Mudakureva noted that high interest rates are the major impediment to accessing loans. 

  

“Government needs to address the issue of liquidity because our capacity is low. There are demands from banks of collateral which we do not have since we are still emerging,” said Mr. Mudakureva.

 

Small to Medium Scale Enterprises and Co-operative Development Minister Cde Sithembiso Nyoni said treasury should broaden assistance to the sector noting that the ministry has only received one million out of the 8. 25 million allocated in the 2010 budget, while the rest is understood to be under vote of credit.

 

“Provisions for long term finance will be necessary in order to create more manufactures in the sector as opposed to traders that deal with imported wares, noting that the current costs of borrowing form banks and micro-finance institutions are prohibitive,” said Cde. Nyoni.

 

Inadequate infrastructure and high rentals have also negatively affected SMEs resulting in some traders operating in undesignated areas.

 

The SMEs sector is one of the fastest growing sectors in the country due to high unemployment although the many entrepreneurs are still engaged in trading imported products.