Small and Medium Enterprises Association (Smea) has urged Malawi Government to sufficiently provide for the construction of industrial shells in this year’s budget to improve the quality of goods produced by the sector.
Speaking in an interview after the pre-budget consultation meeting held in Blantyre on Thursday, Smea president James Chiutsi said if similar SMEs operated in the same vicinity they would benefit from massive economies of scale.
He also pointed out that the SMEs would pay lower apportioned rentals.
“A society that wants to develop must be willing to make sacrifices and tough decisions in the short term otherwise blinding ourselves with cosmetic opulence now will see us stagnating in economic development,” said Chiutsi.
He proposed for the setting up of a development fund whose responsibilities would include capacity building, encourage innovation and provide incentives for ideas that prove beneficial to society.
Commenting on the development fund, Gondwe noted that financiers of the proposed institution have emphasised that they would be happy with a development fund in contrast to a development bank as suggested by some analysts.
Gondwe, however, noted that the financiers do not want any government involvement in the fund.
Government has been running fund and initiatives that have not achieved their intended their goals.
For some time One Village One Product (Ovop), a government financed project has been supporting SMEs by providing them with equipment and training.
However, earlier the Ovop national coordinator Kamia Kaluma-Sulumba was quoted in The Nation having said that although they are currently experiencing problems in developing SMEs and reducing poverty they hope they are still at the learning stage.
Apart from the two proposals that have been made by Smea, the association has urged government to provide for the reduction of duties of imported machinery and equipment in this year’s budget which will encourage entrepreneurs to buy manufacturing equipment to increase productivity.
The association has also asked the government to subsidise fees for services offered to SMEs by some government departments including the Malawi Bureau of Standards (MBS), and the Malawi Industrial Research and Technology Development Centre (MIRTDC).