The gazetted Small and Medium Enterprise (SMEs) Order is expected to address challenges facing SMEs in conducting business with government.
The new order will enable SME’s to find adequate space to do business with government by way of procurement.
The order, which was gazetted on Tuesday, was in exercise of powers by Section 36 (2) of the Public Procurement and Disposal of Public Assets (PPDA) Act which was passed in 2017.
Minister of Trade Sosten Gwengwe said on Tuesday in Lilongwe during a press briefing SMEs have been experiencing a lot of challenges when conducting business with the government.
He said: “As such, only a few SMEs, if any, were able to do business with government due to stiff competition from big players that monopolised almost all sectors of the economy.”
Gwengwe described government procurement as one of the best ways of sharing the national cake, saying it has potential to spur equitable income distribution which could reach all corners of the country.
The minister said time for creating an enabling environment has come, to encourage Malawian SMEs participate more actively in the procurement process.
PPDA director general, Ellias Hausi, said the gazetting of the order is operationalising Section 36(2) of the PPDA Act.
Hausi appealed to all SMEs to follow the set procedures in the order by first having their businesses registered with the Registrar of Companies for them to participate in the procurement process.
“There is also need for them to register with PPDA to have a certificate that would allow them participate in government procurement.
“They also have to register with Malawi Revenue Authority [MRA] that they will be paying tax. These are some of the requirements needed,” Hausi explained.
He emphasised on the need for SMEs to adhere to regulations, saying those who will not follow government procurement rules and regulations will have to pay penalties and also face a ban from doing business with government agencies.
Chamber for SMEs Executive Secretary, James Chiutsi, described the development as a win for SMEs who have been failing to supplying goods and services to the government.
He agreed with Gwengwe that SMEs face stiff competition from the big businesses and that with the order if there is competition, it will be among businesses of the same category.
He said the order makes it easier for SMEs to supply goods and services to government.
“As SMEs, we are ready and have taken the challenge. We believe that our quality on goods and services will improve as PPDA will do capacity building for our members.
“We need the support from different government organisations,” he said.
The aim of the order is to capacitate SMEs to participate and contribute to the growth processes that recognise their contribution to the country’s economic growth.
The Ministry of Trade will, in consultation with other stakeholders, start screening and registration process for SMEs where coloured certificates will be issued depending on their categories.