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Vice President Mnangagwa

The growth of small to medium enterprises got a major boost last Friday following the launch of a $90 million funding package by Vice President Emmerson Mnangagwa. Cde Mnangagwa said the funding was meant to capacitate upcoming businesses across the sectors and help formalise their operations.

The funding package dovetails with the Government’s efforts to stimulate economic growth through small to medium enterprises. The funding which was facilitated by the Reserve Bank of Zimbabwe, will be administered by the Ministry of Small to Medium Enterprises and Co-operative Development in collaboration with different financial institutions.

Of the $90 million facility, $10 million will fund horticulture projects, $15 million will go to cross border traders, $40 million will capacitate the gold mining sector, $15 million will be for women empowerment while $10 million has been earmarked for business linkages.

The launch was held under the theme “Promoting Financial Inclusion for Micro, Small and Medium Enterprises and Co-operative Development”.

Cde Mnangagwa said the funding package will complement several policy interventions meant to stimulate economic growth.

He said Government recognises the critical role played by SMEs and cooperatives in addressing the issue of poverty reduction, job creation and income generation. He said the SMEs sector had grown to become the bedrock of economic growth as most retrenchees and graduates have been absorbed by this sector.

Vice President Mnangagwa said Government wanted to assist SMEs with the necessary tools to enable them to grow into big entities that can create jobs and contribute to poverty alleviation. He said Government had realised that despite their huge potential for growth, SMEs continue to struggle to get funding and knowledge of financial inclusion.

He said what has worsened the situation for SMEs was that the little funding available was too expensive hence the Government’s decision to come up with funding packages that provided cheap money. We want at this juncture to urge the thousands of workers retrenched across all sectors of the economy to take advantage of such packages to start their own businesses.

Instead of moaning, the retrenchees should organise themselves into groups and start businesses taking advantage of this cheaper money being provided by Government. Many of the retrenchees were dumped onto the streets by companies taking advantage of the High Court ruling that allowed companies to retrench workers without paying severance packages.

These workers who had spent many years of loyal service with their respective companies found themselves on the streets with no means to fend for their families. It is these retrenchees that should be prioritised when it comes to funding of upcoming businesses.

The Ministry of SMEs on its part should embark on a skills training programme in order to equip these retrenchees with the necessary skills to run their businesses. Government has repeatedly urged Zimbabweans to create jobs instead of seeking employment so funding packages like that which was launched  last Friday provide the required  start-up capital.

Those that benefit from the funding should work hard and pay back the loans to enable Government to continue assisting other upcoming businesses. We believe mechanisms have been put in place to safeguard the fund from abuse and that only deserving individuals or groups benefit.

Those applying for funding should obviously demonstrate their capacity to repay the loans and there should be a monitoring mechanism to ensure that the money advanced is used for its intended purpose.

We want to once again urge retrenchees to ensure they constitute the bulk of the beneficiaries.