UNISAME SUBMITS AGENDA FOR CAPACITY BUILDING OF SMEs

The Union of Small and Medium Enterprises (UNISAME) prior to the Work Group for Capacity Building meeting to be held on 23rd May 2016 at State Bank of Pakistan (SBP) under the National Finance Inclusion Strategy (NFIS) held an open forum at UNISAME office to discuss the requirements of the SMEs and submit recommendations for strategic approach.

President UNISAME Zulfikar Thaver said the government aims at facilitating the small to medium sized sector by financing them at affordable mark up from commercial and financial institutions according to their needs.

Some of the SMEs need finance to modernize their units, some need bridge finance others need leasing facilities and the new entrants who are educated and have innovative ideas need venture capitalist as partners.The SMEs also need mortgage financing under conventional or Islamic banking systems. There is also an increasing requirement for finance under warehouse receipt financing.

Thaver said the SME sector is the vibrant sector, backbone of the economy, the engine of growth and the vehicle for poverty alleviation and best for creating employment.

The stakeholders need to know the size of the sector and for this a survey is required. According to old estimates there are 3.2 million SMEs in Pakistan and in addition to this there are equal number of SME farmers and although this sector is referred to as the SME it is the majority sector capable of growth and stimulating the economy.

The SMEs contribute to 30% of the exports and most of them are involved in value addition and they contribute 35% to GDP and offer employment to about 40% of the labour force.

The impediments to SME growth are lack of education, finance, proper environment, infrastructure, logistics and these days the energy crisis is a real issue.

UNISAME has given a 12 points agenda to promote, encourage, facilitate, motivate and upgrade the SME sector and urged the union chief to highlight the requirements at the meeting of the Work Group of Capacity Building of SMEs at State Bank of Pakistan (SBP) on the 23rd May 2016 under the National Finance Inclusion Strategy to be chaired by the union chief.

The 12 point agenda stresses on the following measures for fast track uplift.

1. To educate the SMEs about the new technologies in production, management, marketing, accounting & inventory control
2. Encourage the SMEs to modernize and make plans for balancing and replacement of their units and arrange transfer of technology.
3. Facilitate the SMEs through banking, leasing,insurance as these are the pillars for growth.
4. The SMEs in order to progress need law and order and protection and need to feel safe.
5. The infrastructure needs to be improved.
6. The SME sector is dependent on logistics which encompasses transportation, warehousing and collateral management.
7. The need for alternate energy is being felt due to the energy crisis.
8. There is an urgent need of industrial estates in all the provinces.
9. The government should adopt a policy of fair taxation and also give tax benefit to innovative industries and new units.
10. The SMEs need their own chamber of commerce and also their own export promotion bureau for marketing support under modern systems of online marketing through SME galleries.
11. The NPO, EDB, SMEDA, PCSIR and TDAP are all dedicated institutions and working hard for the promotion and development of the SMEs together with the commercial banks but they all need to co-ordinate with one another for integrated efforts

12. The government should strengthen and equip the Small and Medium Enterprises Development Authority (SMEDA) and broaden its scope to enable it to reach the SMEs involved in manufacturing, trading and services.

Posted in: Press Releases