Gaborone, BW, Dec 18, 2019, 04:47 /Comserve / -- News feature article on Botswana's bid to boost economic development through SME development. SMEs are another job creation for the country.
Gaborone, Botswana: The Botswana Ministry of Investment, Trade and Industry looking at basing some of the concentration on the Small and medium-sized enterprises or small and medium-sized businesses (SMEs) and export development.
The Botswana Minister of Investment, Trade and Industry, Bogolo Kenewendo said her ministry refocuses its implementation approach and initiatives through a Purposive Apex Model with a view to ensure a more coordinated approach towards SME Development, Investment Promotion and Export Development.
“We have been mandated as the Ministry of Investment, Trade and Industry to create a conducive environment for the promotion of Investment and development of Sustainable Industries and Trade, with a view to diversifying and growing the economy, creating wealth and employment, so that there is prosperity for all,” said Botswana Ministry of Investment, Trade and Industry, Bogolo Kenewendo.
She said under the SME Apex, the Ministry prioritised entrepreneurship and advancement of Small, and Medium-Sized Enterprises (SMEs) as the catalyst to achieving economic growth and development as well as economic diversification. Prioritising SME’s as an engine of growth will therefore propel the economy forward as envisaged in the national vision 2036 as it is providing SMEs with the platform to flourish.
“With a view to develop SMEs, the Ministry developed a Suppliers’ Directory to provide seamless information dissemination to SMEs by sector by region. The initiative is intended to improve networking amongst businesses, reduce transportation costs as services can be sourced close by and most importantly improve SMEs competitiveness,” said Bogolo Kenewendo.
The Ministry also developed a Business Development Kit /Starter Pack which contains information on services offered by various institutions that play a critical role in the development of entrepreneurship and SMEs in Botswana.
The Ministry also developed the standards catalogue which entails all the standards of locally produced goods and services with a view to promoting certification on the global market.
Bogolo Kenewendo said Botswana Bureau of Standards (BOBS) continues to ensure services provided by local enterprises meet international standards.
She says four new companies attained Quality Management System (QMS) Certification and two new Standards Mark (SM) Licenses were issued during 2018/2019. The total number of companies on the QMS Register is 27 whilst the total number of standard mark licenses issued to date is 25.
The standards are alleged to continue to be developed for different sectors and 193 standards for different sectors were approved during 2018/2019.
“The Ministry further put in place a Project Facilitation Fund (PFF) meant to assist business start-ups with funding for EIA, Soil Test, and Certification etc and promote survival of existing business enterprises. In this respect, US$500 000 has been set aside for the PFF and this will be part grant and loan. The PFF was launched on the 21st May 2019 and 22 applications have been received since the launch,” said Minister Bogolo Kenewendo.
She said out of the 22 applications, two applications amounting to US$20 000 have been approved and (CEDA) is currently considering two more applications to the tune of P238 000 for approval. The remaining 18 are being processed by the Botswana Local Enterprise Authority (LEA).
The Ministry resolved to refurbish all LEA factory shells across the country to operate as incubators and Centers of Excellence and these will be centered on sectoral and regional comparative advantage.
“With a view to support Local Manufacturers the Ministry is providing market access for their products through Market Streets. The purpose is to showcase locally produced products to enhance their visibility. The first market street was in July 2018 and the second one was held on the 2nd March 2019 in Gaborone attracting 111 participants out of the 183 invited. The next market street is scheduled for 21st September 2019 in Gaborone,” said Minister Bogolo Kenewendo.
She said as a way of promoting citizen economic empowerment, the Ministry signed commitments with ten clothing retailers. Approximately US$260milion worth of goods has been secure from local producers. Currently the Ministry is engaging other industries such as furniture to find better ways of supporting to local furniture manufacturers.
“In our continuous efforts to develop SMEs, the Ministry through the assistance of UNDP is implementing the Supplier Development Programme. The main aim of the Programme is to build production capacity for SMEs as well as link them with Procuring Entities. This is done through assigning trained local Consultants to selected SMMEs who will then build their capacity and link them with the selected buyers,” said Minister Bogolo Kenewendo.
In an effort to develop productive capacity of SMMEs, the Ministry of Investment, Trade and Industry is continuing with implementation of the Tokafala Enterprise Development Programme. This is a collaborative Programme between the Government of Botswana and three Development Partners being De Beers, Debswana and Anglo American (UK) Services. Like the Supplier Development Programme (SDP), the Programme is aimed at building SME business management skills. This is done through providing mentoring and advisory support services to selected SMEs and it is intended to ensure that these businesses realize their capability to become sustainable.
It is alleged that in 2018, 141 enterprises enrolled in the Programme, out of which 132 graduated and 41 percent of these were women-owned businesses. One hundred and two were enrolled in the advisory programme while 39 were enrolled in the direct mentorship support. Enrolment was in the Manufacturing, Services, Supply and Distribution and Retail which accounted for over 90 percent of the businesses.
The Economic Diversification Drive (EDD) Initiative was conceptualised in 2010, mainly as a result of the high import bill, low industrial base and high unemployment levels. This culminated into the development of an EDD Strategy which was aimed at diversifying the economy.
The objective of the Short-term Strategy was to leverage on the huge Government purchasing power to promote production, procurement and consumption of locally made products and services, and agricultural produce.
“Despite this initiative, the necessary impact has not been felt in the economy due to slow uptake of locally produced goods and services. In this regard, my Ministry through its different Parastatals has developed some initiatives including, incubation programme, Centres of Excellence and the Project Facilitation Fund to support industry development,” said Bogolo Kenewendo.
She said that in recognition of the lack of sustainability of Short-term Strategy, Government approved the Medium to Long Term Strategy whose objective was to develop Sector Strategies. To this end, three Sector Strategies have been developed and are under implementation. These are the Textile and Clothing, Leather and the Dairy Sector strategies, while development of the National Creative Industries Sub-Sector Strategy is on-going.
In view of the challenges that have been experienced in the implementation of EDD Strategy, the evaluation of the Strategy commenced in 2018. The evaluation revealed that not much has been achieved due to challenges related mainly to compliance. The Revised Strategy will re-focus and close gaps from the previous one.
Investment level has also increased to more than US$8 million from less than US$4 million prior to implementation of the regulations. Some local producers have since diversified their product by producing flavoured water increasing their investment by US$700 000.
“For the month of July and August 2019, Parliament passed the Revised Trade Policy (2019) and the National Entrepreneurship Policy (2019). The Revised Trade Policy aims at opening market opportunities for Botswana Exporters in strategic markets like the EU, AGOA, SACU and SADC as well as access to the African Continental FTA. The Trade Policy will also open opportunities for Batswana to access varieties of imports from across the globe,” said Botswana Minister of Investment, Trade and Industry.
The Entrepreneurship Policy aims at developing both opportunity-driven and SMME entrepreneurs. This will be achieved through the creation of a conducive business environment for entrepreneurs; promoting entrepreneurship and skills development across all levels of the education system; facilitating entrepreneurs access to start-up capital; as well as development of regional ecosystems, business clusters and value chains. Overall, this Policy will make Entrepreneurship a culture for Botswana.
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