SMEs vital for economic growth

In the last decade or so many Zimbabweans experienced sanctions induced harsh economic hardships that saw people being pushed to the limit in terms of earning a living. Things got so bad that one had to dig deep into their bags of skills and tricks to continue feeding or providing for their families. That push became a blessing in disguise for some who realized strengths and skills they never knew they possessed. Those that uncovered the entrepreneurship streak in themselves were better equipped to survive the years of hardship. It's unfortunate that Zimbabweans had to realize the importance of the Small and Medium Enterprises (SMEs) in such a way, but one's strength is realized when backed in a corner.

Many Zimbabweans enjoy buying at Mupedzanhamo, Mbare and Glen View but many are not aware that hordes of people they see in those places are employers and employees, eking out a living through SMEs as entrepreneurs. Zimbabwe has become a hub of small and medium size enterprises (SMEs) as formal companies and industries folded due to economic hardships. The country's SMEs make up more than 70 percent of all businesses and they are the country's biggest employer and also slowing becoming the backbone of our economy. SMEs have contributed immensely to the growth of our economy with statistics showing a contribution of about 60% of the gross domestic products (GDP).This has seen many business and entrepreneurs flourishing in their area of specialization.

It is estimated that 5, 7 million people are employed in the informal sector. SMEs are being hailed for their pivotal role in promoting grassroots economic growth and equitable sustainable development that this year alone the Ministry of Small and Medium Enterprise Corporation Development (SMECD) launched rural industrialization in which they are promoting the use of natural resources thus creating employment and feasibility of the SMEs in rural areas.

The SMEs occupy a key and strategic role in revitalizing the economy. It is universally acknowledged that they are effective instruments of employment creation and economic growth, which ultimately lead to poverty alleviation for the entrepreneurs themselves as well as their employees. Their contribution will help turn the economic fortunes of the country and already many have experienced an improved way of life. To fully contribute to the growth of the economy and country, SMEs need to evolve and become registered businesses that contribute to the fiscus.

SMEs should take a leading role in the economic uptake exploiting the empowerment policy advocated by Government which is meant to make Zimbabwean owners of their destiny. This year alone the Ministry of SMEs unveiled about US$7million to benefit upcoming entrepreneurs as well as existing entrepreneurs. Other stakeholders like Common Market for Eastern and Southern Market (COMESA) supported by European Union have also been supporting SMEs by handing over leather processing equipment worthy thousands of dollars to be used by local entrepreneurs, support which should be fully exploited. The donated leather is mainly meant to boost leather production and industrialization, an opportunity that can create a springboard for the SME sector, sustenance and growth thus guarantee development into large corporations.

However for SMEs to be a success other players need to come on board and not let government fight a lone battle in support of SMEs. Many financial institutions has put stringent measures which hinders the growth of these SMEs. It is high time there should be mutual agreement and cooperation between SMEs and the financial sectors so as to foster development of our country.

The Ministry of Small and Medium Enterprises and Co-operative Development is on a drive to ensure that all businesses in the sector are registered. It's high time all entrepreneurs take governments call and register with the Ministry of SMEs so that the SMEs can be the backbone of Zimbabwe's economic recovery path.