|
Govt sets up fund for SMEs empowerment
2008-01-25 08:36:14
By Felister Peter
The government has launched a Mwananchi Empowerment Fund to support small and medium entrepreneurs (SMEs) throughout the country.
Speaking at the fund`s launch in Dar es Salaam yesterday, Planning, Economy and Empowerment minister Juma Ngasongwa said that so far a total of 400m/- for providing small loans of between 50,000/- to 5m/ had been set aside.
The fund, which is managed by the newly formed National Council for Economic Empowerment, will help budding Tanzanian entrepreneurs to own the economy by providing them collateral for banks and other financial institutions.
Ngasongwa also called on mining and other big companies to support the fund so that more Tanzanians could benefit from it and hence reduce poverty.
The government expects to boost the fund in its 2008/2009 financial year.
He said the fund was established with the aim of helping Tanzanians out of poverty by enabling them to participate in economic activities.
The fund was also part of the nation`s Development Vision of 2025, noted the minister.
``We expect the country’s economy to be owned by Tanzanians themselves by 2025,`` he stressed.
Ngasongwa said that the loans provided would attract very low interest to enable many people obtain credit facilities, which are to be in a three-tier arrangement.
He said from 50,000/- to 5m/- would be for small enterprises, 5m/- to 500m/- for medium ventures and more than 500m/- for big businesses.
Meanwhile, the fund`s secretary general, Eliseta Kwayu, described the current economic situation of the common Tanzanian as terrible, whereby more than 31.5 million people, equivalent to 89.9 per cent, were earning less than 2,000/- per day.
He said that Tanzanians who are in formal employment account for only 9.2 per cent while those in the informal sector are 11.7 per cent.
Among them 79 per cent are employed in the agricultural sector.
Kwayu said the launched fund would therefore help SMEs to provide more employment opportunities by empowering them to increase production.
Through loans offered by the fund most SMEs would be able to compete within the East African market, he said.
He said that more than 700,000 join the labour market each year while the government`s ability is to employ only 40,000 people annually.
|
