SMEs cardinal to national development



Dear Editor,

Small and medium enterprises (SMEs) play a cardinal role in fostering national development of any country in the world. Countries that have put so much emphasis on SMEs as small and medium enterprises are commonly referred to, have made strides in economic development. Examples are America, China, Japan to mention but a few. The advantage of SMEs is that they spur production and ultimately economic growth in the country. When this is done, it will enhance foreign trade, that is the export and import of goods and services between and among countries. When export is more than import, this will result in favourable balance of trade and foreign exchange will be derived from such a scenario. On the other hand, when import outstrips export, the end result is unfavourable balance of trade or trade deficit. For the SMEs to contribute significantly towards the economic well-being of the country, there is need to put in place certain mechanisms which will boost trade in all sectors of the economy. These include lowering interest rate by the financial institutions such as banks to potential entrepreneurs, making accessibility of loans as simply as possible by not demanding too much collateral security from those wishing to obtain loans, by offering professional advice to upcoming and existing entrepreneurs among others. In tandem with government policy on promoting SMEs, thereby empowering them economically, there is need to providing equal access to loans to all potential entrepreneurs. If fully supported, the SMEs have the potential to creating employment opportunities, hence supplementing Government efforts in job creation for its citizenry. All things being equal, SMEs should be promoted by the Government in its quest to develop the country so that people can benefit through buying goods and services at reasonable or cheap price.   This is very much tenable as it has worked in developed countries provided there is political will from national leadership. For such an objective to be achieved, there is need to put in place some mechanisms which will boost economic growth in the country as alluded to earlier. ELEMIYA PHIRI Lusaka