The government is finding ways to address the problem of high interest rates facing Small and Medium Enterprises (SMEs) in the country, a cabinet minister revealed yesterday.
Industry and Trade minister Dr Abdallah Kigoda made the revelation in Dar es Salaam when opening the 13th International Conference on African Entrepreneurship and Small Business.
The conference, hosted by the University of Dar es Salaam Business School (UDBS), primarily focused on addressing challenges entrepreneurs faced in their endeavours locally and internationally.
According to the minister, SMEs had failed to deliver to people’s expectations due to myriads of difficulties they faced in accessing funds from financial institutions.
He said lack of information amongst SMEs was a big impediment to their active participation in the economy.
The government, through the Business Environment Strengthening for Tanzania programme, implements a number of reforms such as business regulations, land law, and improving institutional support.
“The government recognises SMEs’ support in poverty reduction and sustainable economic development, but I can assure you now that the government, in collaboration with other stakeholders, is working hard to set the business environment right for small businesses to enable SMEs become significant players in the private sector,” he said.
Dr Kigoda said more efforts on credit accessibility were needed to facilitate an enabling environment for upcoming entrepreneurs to bring about intended results in sustaining and developing different categories of entrepreneurs.
Meanwhile, the minister urged SMEs and other private sectors attending the conference to increase efforts to forge alliances with stronger enterprises in the private sector in complimenting the government’s efforts towards economic development and poverty reduction.
Mzumbe University lecturer Honest Ngowi expressed his appreciation to the government for enacting the SMEs Business Policy, saying it was good for creating good business environment.
Ngowi, who is also an economist, said the national budget tabled in the Parliament last week by Finance Minister Dr William Mgimwa won’t help much in creating good business environment to SMEs.
“SMEs are extremely very important to our country development, the current increased taxes especially for the mobile phones companies will affect the private sector and SMEs as well,” he said.
For his part, University of Dar es Salaam acting vice-chancellor Prof Yunus Mgaya said the country’s social and economic development considerably depended on SMEs, which have been principal contributors to the Growth Domestic Product.