European Union (EU) and its partners - United Nations Development Programme (UNDP) and Lilongwe University of Agriculture and Natural Resources (LUANAR) - have launched the Business Incubation Program, which aims to foster an entrepreneurial culture and facilitate sustainable enterprise among the youth.
The programme is part of the Zantchito Entrepreneurship and Access to Finance initiative.
Speaking at the launch, which took place at Agribiz Hub at LUANAR's Bunda Campus on Friday, Head of Cooperation at the EU Delegation to Malawi, Ivo Hoefkens, said Zantchito was crafted to overcome significant challenges within Malawi's job market where the majority of jobs exist in the informal sector, constituting approximately 90.
Hoefkens therefore disclosed that their goal is to enhance the employability and self-employment prospects, primarily for young Technical Entrepreneurial and Vocational Education and Training (TEVET) graduates and other graduates with ideas and entrepreneurs, particularly focusing on empowering women.
"Formal job openings in the economy are severely limited, ranging from 30 to 40 thousand annually. With over half of Malawi's population being 18 years or younger, around 300 to 500 thousand young individuals enter the active labour force annually, facing scarce opportunities for securing decent formal employment," he said.
According to Hoefkens, micro, small, and medium enterprises (MSMEs) account for around 1.7 million people, roughly 38 percent of the working-age population.
He observed that despite this, Malawi's private sector is largely informal, with over four million jobs in the informal economy compared to 500,000 formal jobs.
But Hoefkens lamented that 'these idea stage entrepreneurs and MSMEs lack essential technical, financial, and regulatory support required to elevate their businesses to play more substantial roles in aligning with the government's vision 2063 to reach a higher middle-income economy'.
"The prevailing issue is the absence of a conducive ecosystem for entrepreneurial growth. There is a lack of comprehensive business support services, nascent business incubation services, and notably limited access to finance, especially for smaller entrepreneurs.
"The Zantchito Skills for Jobs program aims to redress these constraints by fostering an entrepreneurial culture, facilitating sustainable enterprise by bringing together business incubators and BDS providers to deliver high quality services to entrepreneurs, ultimately leading to the creation of decent formal jobs," he explained.
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He recommended that as Malawi moves forward, it was it's imperative to encourage and nurture the entrepreneurial spirit within the youth while investing in education that promotes innovation, while also instilling an entrepreneurial mindset is vital in shaping a future generation of Malawian entrepreneurs who are ready to tackle emerging challenges and driving sustainable development by building robust enterprises that create more new jobs.
UNDP Deputy Resident Representative Challa Getachew said his organization expects that the incubates will receive all the support that they need to test their ideas to develop their ideas and to go to the market.
"And in the coming few years. I hope that most of them, if not all of them, we know the survival rate of incubate usually is not the level that's expected that this can't be 100 percent.
"But we hope that with the support that they receive from through the project or service provider, they will take their products to the market and contribute to the Malawi's development, because private sector is going to be the engine of Malawi's development. Experience from countries that are protests. The project is focused on job creation," said Getachew.
In his remarks, Zantchito Entrepreneurship Team Leader, Navin Kumar, said the interventions will be implemented through three major workstreams, which include strengthening business incubators, strengthening BDS provision and providing business incubation services to studies from universities, TEVET-accredited institutions, among others.
