The Ministry of Trade and Industry (Minicom) has announced plans to employ a new approach to support Small and Medium Enterprises (SMEs) through clusters to address lack of relevant skills affecting their competitiveness on the labour market.
Trade minister François Kanimba disclosed this yesterday at a two-day SME development forum in Kigali.
The forum discussed the role SMEs play in economic development, the challenges they face and how to build synergy in SME interventions.
A survey conducted in 2011 showed there were 123,000 companies operating within the country of which 90 per cent were SMEs, which reflects the sector’s large portion of the economic component, especially through employing most of the youths, according to the minister.
He said in the past two years, 7,000 jobs have been created under the Hanga Umurimo (create own job) programme.
“SMEs meet many challenges, including lack of managerial skills, production skills and technology for the production of standard products able to compete on the market,” the minister said.
He said Minicom, the National Employment Programme (Nep), the private sector and other government partners are mulling over approaches to ensure SMEs meet required standards through SME clustering.
This would involve identifying SMEs running similar businesses and putting them in the same category.
“As of now, the SMEs mapping and cluster strategies have been done in all districts and this will help in skills development and organisation of SMEs operations. The clustering will also facilitate good SME mentorship and development,” Kanimba said.
The Manager of Nep, François Ngoboka, said the Community Processing Centres in SMEs clusters will help promote SMEs.
He said the country’s target to create 200,000 off-farm jobs annually was about to be achieved. Every year, about 145,000 youths join the labour market, he said.
Ngoboka added that they have reached a training agreement between investors, training institutions and Nep implementers to work on the skills gap once identified.
He noted that SMEs have constraints related to skills and Nep is committed to offering the youth technical and hands-on skills to ensure that SMEs are competitive.
Short-term vocational training graduates will be helped get 50 per cent of the investment needed for equipment and start-up to start SMEs, he said.
Nep has at least two business development advisors at each district to help in SMEs coaching and mentorship.
The last Integrated Household Living Conditions Survey (EICV), conducted in 2011, showed that many SMEs require efforts to ensure their sustainability and productivity through proper planning, mentorship, monitoring and evaluation.
Robert Ford, the second Vice President at ICT Chamber in Private Sector Federation (PSF), said there are gaps in skills, which affect SME development.
“For instance, in the ICT industry, we have a lot of data that needs to be developed, processed and accessed for the betterment of society, but there are skills still lacking,” he said.
The SME Forum 2014 was organised under the theme: “SME Development: An engine for achieving National Economic Growth Targets.”