Minister courts SMEs in job creation drive

Minister of Labour Ken Kandodo says small and medium enterprises (SMEs) remain key to the country’s economic development and job creation.

Speaking in Blantyre on Wednesday when he met about 100 SMEs on the ministry’s one million jobs creation drive, the minister said they are working on modalities to improve the country’s business environment to ensure that businesses thrive.

He said SMEs have potential to grow the economy and create jobs; hence, their focus in ensuring that the challenges they face are addressed.

Said Kandodo: “SMEs are a critical aspect in creating jobs in our country. We, however, realise that they are facing a number of challenges , but we are committed to creating vibrant and productive SMEs who will help in job creation and skills development.”

SMEs continue to face challenges that undermine their growth potential such as lack of access to finance, access to land, high business operating costs and low production capacities.

The SMEs sector remains an integral part of the country’s economy, consisting of 1.1 million business owners, according to a 2019 Small and Medium Enterprises (SMEs) Survey by Finscope. 

In an interview on Wednesday, Chamber for Small-scale Business Association secretary general James Chiutsi admitted that there are several challenges SMEs  face that need to be addressed if creation of jobs is to materialise.

He said: “SMEs are facing challenges ranging from skills development, access to markets and finance.

“We have members from various sectors who are lacking skills to execute their jobs efficiently.”

During the meeting, SMEs raised various concerns affecting the sector, calling for prompt action from the government to address the issues.

One of the SMEs, Charles Phiko, who sells agriculture produce, singled out underutilisation of local products, accusing foreign companies of importing products that are locally produced.

He said: “We do have the resources to grow some products on a large-scale but we are limited to small-scale production because of markets.

“You find that companies that can buy these products from us import the same from various countries such as South Africa. This is a serious issue that undermines our growth potential.”  

Ministry of Labour estimates that SMEs sector contribute about 24 percent to the jobs market.

The figures also show that about 21 percent of Malawian adult population derives their livelihoods from the SMEs sector.

The sector contributes about 16 percent to the gross domestic product.