Effect policy interventions that will boost the performance of SMEs, Govt told |WestMac Media

The Kitwe District Chamber of Commerce and Trade has called on government to put policy interventions that will boost the performance of small and medium scale entrepreneurs (SMEs) for them to fully contribute to the country’s economic growth. 

Kitwe Chamber of Commerce and Trade vice president Emmanuel Mbambiko said SMEs had potential to push the country to the 2018 projected economic growth of five per cent if well nurtured. 

Speaking yesterday on YAR FM radio station programme dubbed ‘Social Chatter’ Mr. Mbambiko said the SMEs have proved to be an effective economic driver in most countries where they have been given favourable incentives for their operations.

He noted that in Zambia, SMEs were failing to attain their full potential due to several challenges that include high tax rates, cost of electricity, and bank interest rates. 

He said government should find means of helping SMEs with these challenges. 

Mr. Mbambiko added that SMEs were currently faced with a challenge of Value Added Tax (VAT) being paid at source, meaning that their money will be trapped twice. 

He said when SMEs are importing goods, they are charged VAT at the border point and also their money will be trapped at the point of sale which he said was a set back to their growth. 

Mr. Mbambiko has therefore suggested that government should consider waving VAT at source for SMEs with a turnover of K20 million and below so that they are helped to grow. 

He said government should take a leaf from the United States of America President Donald Trump who has provided incentives to promote the growth of local investors by reducing taxes. 

He has meanwhile complained that government does not adhere to suggestions made by the Chamber of Commerce and Trade. 

He said if government could heed to some of the suggestions the chamber makes, the SMEs and other productive sectors could have grown significantly. 

SMEs have for some time complained of failing to grow due to set backs that include high bank lending rates, electricity cost and unfair competition from cheaply produced foreign products among others. 

And government has on several occasions recognised SMEs as potential drivers of economic growth.