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The government is increasing its assistance to the micro and small business sector, with more than $3.8 billion in loan funds to be channeled into the sector this fiscal year.
The sum is up from $2.2 billion, which was made available in 2005/2006.
Minister of Industry, Technology, Energy and Commerce, Phillip Paulwell, speaking at the opening of the 6th annual Caribbean Microfinance Network (CMN) roundtable conference at the Holiday Inn resort in Montego Bay yesterday (May 15), informed that the government had also undertaken the establishment of business incubators, which are geared toward nurturing existing micro enterprises and potential start-ups and to encourage community-based production centres, which would receive a range of government support through its various agencies.
“The incubators would operate as a centre of production, training and technical assistance to the participants and other micro and small enterprises in the general community. They will play an important role in providing general business development services for small and micro enterprises and would foster best practices and modern know-how,” he informed.
The Minister noted that the increased assistance to micro and small enterprises is in recognition of the sector’s important role in the Jamaican economy over the past decade.
“The sector has been recognized as one of the means of achieving poverty reduction, increased employment and growth. The role of the sector in achieving these objectives has been more pronounced over the past few years, as some of the traditional sectors experienced contraction,” he noted.
“For our part, the government has identified the micro and small enterprise sector as a focal area for job creation and economic empowerment of our people. We believe that micro and small enterprises are crucial to the Jamaican economy, because of their role in the production and distribution of goods and services and in the enhancement of innovation, productivity and economic competitiveness”, Minister Paulwell stated.
The Jamaica Business Development Centre (JBDC) is the institution mandated to lead the government’s initiative to facilitate the sustainable development of the sector.
Mr. Paulwell noted that while the full contributions of informal businesses are not fully accounted for in the economic statistics, estimates are that the sector contributes up to 40 per cent of the country’s total income.
“One of the challenges to national development is ensuring that these enterprising men, women and young people are brought into the economic mainstream. When small businesses become formalized, the owners can benefit from training, technical support, soft loans, marketing and promotional programmes and the various government and non-governmental assistance that can grow the business and increase its profit,” Minister Paulwell indicated.
He noted that recently, the government took the bold step in changing the regulations governing the registration of companies and the new rules allow for the registration of one-man companies with simplified requirements. In addition, preferential loans to the sector have grown progressively especially during the past 10 years, he informed.
In the meantime, the Technology Minister commended the Caribbean Microfinance Network for “maintaining and sharpening this focus in the region as is evidenced in the staging of this roundtable conference.”
The three-day conference is being held under the theme: ‘Managing for sustainability, viability and growth to serve the majority’ and will focus on issues impacting on microfinance lending in the Caribbean.