eBusiness Weekly
Sikhulekelani Moyo
SMALL to medium enterprises (SMEs) should actively participate in both local and regional value chains in a bid to enhance their capacity to trade within the African Continental Free Trade Area (AfCFTA) and the world at large.
Micro, small to medium enterprises (MSMEs) are the bedrock of the global economy as they account for over two thirds of all formal jobs in developing nations, official data reveals.
The World Bank estimates that 600 million jobs will be needed by 2030 to absorb the labour force, which makes the development of SMEs critical for Governments around the world.
In Zimbabwe, MSMEs significantly contribute to economic growth and sustainable development.
Recent statistics as highlighted in the 2021 MSME Survey and 2022 Finscope Survey show phenomenal growth of the sector with contribution of more than US$8,6 billion to the gross domestic product (GDP).
The survey further reveals that approximately 4,1 million individuals were operating 3,4 million enterprises, which employ 4,8 million people on a full-time basis.
In her keynote address at the SMEs Business Workshop held in Bulawayo on Wednesday on the sidelines of the ongoing Zimbabwe International Trade Fair (ZITF), Minister of Women Affairs, Community, Small and Medium Enterprises Development, Monica Mutsvangwa, said despite the huge contributions made by MSMEs, the sector is still faced with a number of challenges resulting in low productivity and competitiveness.
These challenges include limited access and high cost of finance, limited access to markets, weak managerial and technical skills, limited access to appropriate workspace, high costs of utilities and interrupted supplies and multiplicity of regulatory requirements among others.
“AfCFTA presents opportunities from which SMEs can benefit from a huge single continental market with a population of 1,3 billion people and a combined GDP of approximately US$3,4 trillion,” she said.
“This free trade area offers potential for diversification of products and service offerings to meet a diversified market, cost reduction through elimination of tariff and non-tariff barriers and collaboration and networking opportunities for SMEs from different countries,” said the minister.
“However, for SMEs to fully benefit from these opportunities, their active participation in local and regional value chains is important.”
The workshop, which was organised by the ministry in partnership with the United Nation Development Programme (UNDP) brought in presenters from ZimTrade, Marketers Association of Zimbabwe (MAZ), Registrar of Companies and the Standards Association of Zimbabwe.
Sen Mutsvangwa said the workshop signifies a deepening drive to revitalise the sector and capacitate MSMEs on contemporary matters affecting their competitiveness and growth to enable them to participate in local, regional and continental markets.
In his presentation, ZimTrade chief executive officer Allan Majuru said the national trade development and promotion body facilitates export of value-added products, where he said Zimbabwe has been for the past years exporting minerals and commodities, which resulted in exportation of jobs.
He called upon SMEs to collaborate saying that the export market is huge and for SMEs to be able to meet the demand they should work together to improve their product quality, branding and packaging.
“Statistics shows that Zimbabwe’s exports have been growing since 2013 even though the imports are also growing, the good part is the imports are of machinery and equipment,” he said.
Majuru said SMEs need to capitalise on what Zimbabwe is good at where he said the country has an opportunity to export organic products, which are on demand globally.
Another presenter for MAZ Felix Mambondiyani said SMEs should embrace digitisation and digitalise their operations saying this can improve efficiency, increase brand visibility and reduce cost of doing business.
