Poor funding hampers youth jobs drive

Umurengi Saving and Credit Cooperatives (SACCOs) are reluctant to offer loans to budding entrepreneurs whose projects are worth funding.
Job seekers look for job opportunities on a notice at Kigali Employment Fair at Petit Stade in Remera earlier this year. / File.
Job seekers look for job opportunities on a notice at Kigali Employment Fair at Petit Stade in Remera earlier this year. / File.

Umurengi Saving and Credit Cooperatives (SACCOs) are reluctant to offer loans to budding entrepreneurs whose projects are worth funding.

And, this is one of the challenges affecting the National Employment Programme (NEP), the Minister for Trade, Industry and East African Community affairs, Francois Kanimba said during a meeting with various stakeholders in Kigali on Monday.

 

The meeting brought together central government officials, district vice mayors in charge of economic affairs, officials from the Business Development Fund (BDF), business development advisors, SACCOs managers among others.

 

The meeting discussed the implementation of the National Employment Programme.

 

Kanimba said, while the government, through BDF has committed to supporting TVET graduates, through SACCOs, the programme is affected by blame game between SACCOs, BDF and beneficiaries.

The government committed to buying tool kits for TVET graduates for them to create own jobs, by offering 50 per cent in loan, while the rest is paid by beneficiaries after signing agreement with SACCOs.

But SACCOs claim government forces them to offer loans to non esteemed clients while the beneficiaries also argue they have little role in the process of getting loans.

“We have identified this as a serious issue and established a committee to find a lasting solution,” said Kanimba.

Also, business development advisors who were trained to support entrepreneurs in preparing projects leave after a short period for further studies or for other activities.

The government targets is to create 200,000 off farm jobs every year, according to Kanimba.

Particularly, NEP is supposed to create 22,000 jobs every year and this target was achieved last year.

There are at least 60 SACCOs which signed contracts with BDF to offer loans to entrepreneurs with good projects.

But officials said those are very few.

In line with the current development blueprint, the second Economic Development and Poverty Reduction Strategy (EDPRS II), NEP was created to enhance impact of employment interventions, avoid duplication in planning, and equip the workforce with employability skills while seeking to increase output.

It is built on four pillars which guide the implementation of the program: Skills development, Entrepreneurship and Business Development, Labour Market Interventions, and Coordination, Monitoring and Evaluation of national employment interventions.

The drive, according to officials, will ensure the annual government employment projection is achieved.

Under NEP, the government and its partners plan to have Integrated Craft Production Centres (ICPCs) (udukiriro) in all districts, and according to official figures, there are 21 standardised centres in 21 districts; six districts have substandard centres, while three have none.

Kanimba challenged district officials and partners to ensure more standardised ICPCs are constructed, equipped with modern materials, while ensuring that they are well managed and maintenance is regularly done to avoid losses in the future.

Innocent Bulindi, the BDF chief executive, maintained that the fund is committed to ensuring that more beneficiaries are supported and channels money through Saccos at a low interest, of 2 per cent.

He encouraged more people to submit their project proposals for funding.

Innocent Nyamwasa, a SACCO manager, said that it is always hard for banks to offer loans to entrepreneurs for tool kits when collateral is the same kits.

He suggested that BDF should be offering 50 per cent in loan and 75 per cent in collateral.

“That way, we can offer more money,” he said.

Officials at the Work Development Authority say that thousands of entrepreneurs have graduated from various training institutions and need startup kits to create own jobs.

Over 10,000 graduated last year alone according to officials.

editorial@newtimes.co.rw

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