Nairobi — The State Department of Micro, Small and Medium Enterprise (MSME) Development says it is alarmed by the increased number of small businesses closing shop and is rolling out more intervention measures to correct the situation.
Director of the central planning and monitoring unit in the State Department of MSME Development Festas Wangwe says the department is working on a raft of intervention measures including that of addressing taxation and also supporting small businesses to access training.
"We are so concerned at the rate at which some MSMES are closing. It is really alarming and it is now forcing us to step up our efforts in terms of nurturing these MSMES so that they cannot wind up," said Wangwe.
Speaking in Mombasa during a Kenya Institute of Business Training (KIBT and Japan International Cooperation Agency (JICA) seminar themed 'Enhancing Enterprise Competitiveness Through Application of Japanese Management Excellence', Wangwe lauded the two entities for the efforts in supporting small businesses' sustainability through trainings.
"There are certain policies that we have to address that are really affecting the MSMEs ranging from multiple taxes especially from both from national and county governments. We have efforts we are putting in place to harmonize this so that MSMEs can be supported," he said.
"Another important thing, which JICA is addressing, is capacity-building and we want to thank JICA for these efforts which are already completing what we are planning to do."
The JICA project, which it signed with the government in 2019, targets enterprises within Nairobi and its environs, Mombasa, Uasin Gishu and Nakuru counties.
The term of cooperation runs from January 25, 2021 to February 28, 2025 with room for extension.
Hajime Iwama, chief representative of JICA Kenya office said while the project primarily targets MSMEs in the manufacturing sector, JICA has been able to support the value chain in other sectors through various collaborative initiatives.
"We are privileged to have undertaken trainings and pilot consultations in Mombasa County this year and we are grateful for the support provided by the county government," said Mr Iwama.
The project, among other deliverables, enhances the ability of small enterprises to access financing by equipping them with knowledge such as that of preparing financial documents for loan screening.
SMEs are also put in an ecosystem for interacting and collaborating with trade and financial institutions to improve their business processes and receive support from financial institutions and investors.
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A survey by the Kenya National Bureau of Statistics (KNBS) showed 2.2 million micro small businesses shut down in the five years ending 2016.
The figure is an equivalent of approximately 440,000 MSMEs closing yearly, a statistic that the JICA training wants to overcome by equipping small firms with new skills set to run sustainably.
JICA, through the Japan Productivity Centre in collaboration with KIBT, has so far trained over 20 firms and targets to hit over 48 by the end of the project.
According to JICA, it has so far trained 30 master trainers and 68 trainers by, enabling them to roll out consultancy services for other enterprises looking to enhance business competitiveness.
Kenya government's vision 2030 identified the promotion of Small and Medium-sized Enterprises (SMEs) and human resources development as key in achieving the desired 10 percent annual GDP growth.
