IMPORTANCE OF MICRO AND SMALL ENTERPRISE SECTOR HIGHLIGHTED

Minister of State in the Ministry of Industry, Investment and Commerce, Michael Stern has said the Government recognizes the micro and small enterprise sector as a focal area for job creation and economic growth.

Delivering the opening address at the 7th annual Mandeville Money Expo, held at the Golf View Hotel on April 10, the State Minister argued that over the past decade the sector has helped to reduce poverty, increase employment and contribute to growth.

“The role of the sector in achieving these objectives has been more pronounced in recent years, as some of the traditional sectors experienced contraction. Due to the recent demand for and relative success of micro-credit, many in the traditional banking industry have begun to realize that these micro-credit borrowers should be categorized as pre-bankable; thus micro-credit is increasingly gaining credibility in the mainstream finance industry and many traditional large organizations are contemplating micro-credit projects as a source of future growth,” he noted.

“Here in Jamaica our credit unions and at least two of our largest commercial banks have dedicated micro enterprise financing portfolios,” Mr. Stern pointed out.

Stressing the importance of the sector, the State Minster said over the past 10 years, the Government, donors and the private sector have channeled technical resources and preferential loans to finance small and medium enterprises.

“During fiscal year 2005/06, over $2.2 billion in loan funds was made available to the sector. For fiscal year 2008/09, just over $3.8 billion will be available. Micro and small enterprises stand out as major sources of income for women and young entrepreneurs. It is estimated that the sector contributes up to 40 per cent of the country’s total income, and the challenge that we must overcome in national development, is to ensure that all enterprising men and women are brought into the economic mainstream,” he said.

Mr. Stern pointed out that the Government would assist the small business sector through a number of services offered by the Jamaica Business Development Centre (JBDC), which include designing, product development, engineering, business development and research.

“The Government is committed to programmes and policies which encourage and nurture entrepreneurship and empower our people through self employment. We have now embraced the establishment of business incubators intended to enhance activities within the sector. The incubators will operate as a centre for production, training and technical assistance to the participants and other players in the general community. The JBDC is mandated to lead this initiative; they will provide general business development for micro and small enterprises, foster best practices and modern know-how,” he said.

“Through programmed interventions, participating small enterprises will have an opportunity to correct their organizational weaknesses, avoid costly mistakes and minimize business failure,” the State Minister noted.