MSMEs in East Africa urged to scale up operations


Micro, Small and Medium Enterprises (MSMEs) in the East African Community have been advised to scale up their operations in order to grow quickly and become large enterprises that will be competitive at the regional and international levels.

This was said by Rwanda’s Minister for Trade and Industry, Hon. Soraya Hakuziyaremye, who urged the MSMs to graduate into bigger enterprises rather than remaining an MSMEs forever.

The African Development Bank is also in the forefront of the continent’s drive to empower and create jobs for the youth. It is implementing a 10-year strategy (2016–25), “Jobs for Youth in Africa”, designed to provide funding for micro, small, and medium-sized enterprise (MSME) and skills development programmes for the youth in high-priority sectors.

The strategy, currently implemented in a dozen African countries, aims to directly create 25 million jobs and positively impact 50 million youth by 2025.

MSMEs represent more than 90 per cent of businesses in East Africa, adding that growing MSMEs would therefore be the backbone of the regional economy.

According to Ms. Hakuziyaremye, the long term goal of the EAC was to increase the contribution of MSMEs to Partner States’ GDPs from the current 20 per cent to 50 per cent. She urged EAC Partner States’ governments to do all in their powers to address challenges faced by MSMEs to enable them create employment and reduce the high poverty levels.

The Minister said that key areas of capacity building for MSMEs would be in areas such as standards, cross border trade regulations, metrology, business licensing and registration, and the elimination of Non-Tariff Barriers to Trade (NTBs).

On the growth of MSMEs in Rwanda, Ms. Hakuziyaremye said the government was committed to strengthening support services for MSMEs in addition to boosting their credit worthiness for purposes of attracting capital from local and international sources.

She said Rwanda had embarked on a ‘Made in Rwanda Policy’ purposely to showcase locally made products to national and international markets.

Ms. Hakuziyaremye was officially opening the 20th EAC MSMEs Trade Fair, previously known as the EAC Jua Kali/Nguvu Kazi Exhibition, at the Gikondo Expo Grounds in Kigali, Rwanda. The 20th EAC MSMEs Trade Fair has drawn more than 1,000 exhibitors from five EAC Partner States, namely Kenya, Rwanda, South Sudan, Tanzania and Uganda.

Speaking at the event, the EAC Deputy Secretary General in charge of Planning and Infrastructure, Engineer Steven Mlote, said that the annual trade fairs have over the two decades, brought together exhibitors from the East African region for purposes of opening up new markets for their products while bridging the existing knowledge and technological gaps between them.

“The exhibitions have proved to be strategic avenues for promoting the Small and Micro Enterprises sector’s products, transfer of technologies, and enhancing regional integration,” said Eng. Mlote who represented EAC Secretary General Amb. Liberat Mfumukeko.

The DSG said that the EAC views MSMEs as engines to spur rapid economic growth as envisaged in the Treaty in addition to creating employment for EAC citizens.

“Managed well and with a supportive policy and regulatory environment, MSMEs can promote value addition to our natural and agricultural resources thereby increasing the region’s share in continental and global trade,” said Eng. Mlote.

“We must also not forget that most of today’s multinationals were at one point in time small enterprises that grew into the giants they are now mainly due to a conducive business environment in their home countries,” added the DSG.

In his remarks, Mr. Charles Waithaka, the Chief Executive Officer of the Micro and Small Enterprises Authority in Kenya, revealed that 14.4 million per cent of Kenyans draw their livelihoods from directly from MSMEs which constitute 89 per cent of businesses in Kenya.

Mr. Waithaka said that MSMEs also contribute approximately 33.3 per cent gross added value to Kenya’s Gross Domestic Product.

Mr. Waithaka urged the exhibitors to go beyond selling their wares at the trade fair and endeavour to establish links or networks to promote the free movement of locally manufactured goods in the region.

On his part, the EAC Director General for Customs and Trade, Mr. Kenneth Bagamuhunda, said the EAC was building digital platforms that would promote e-commerce in East Africa.

“We want to digitalize MSMEs in the region so that we can have a virtual exhibition that goes beyond the once a year trade fair,” said Mr. Bagamuhunda.

Also present at the function were Kenyan Governors Jackson Mandago (Uasin Gishu County) and Alex Tolgos (Elgeyo-Marakwet County). Uasin Gishu County hosted the 19th EAC Jua Kali/Nguvu Kazi Exhibition at the Eldoret Sports Club, Eldoret in December 2018.

Also Read:East African SMES ready to tap into the wider African market

Yvonne Kawira is an award winning journalist with an interest in matters, regional trade, tourism, entrepreneurship and aviation. She has been practicing for six years and has a degree in mass communication from St Paul’s University.

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