The Micro, Small and Medium Enterprise (MSME) sector is set to benefit from loans and technical assistance totalling upwards of $3 billion from the Development Bank of Jamaica (DBJ) during the 2012/13 fiscal year, Finance and Planning Minister, Hon. Dr. Peter Phillips, has announced.
Making the opening presentation in the 2012/13 Budget Debate in the House of Representatives, on May 24, under the theme: ‘A New and Binding Covenant for Stability, Equitable Growth and Prosperity’, Dr. Phillips said this sum included $1.5 billion in direct loans to stakeholders, and another $250 million to be set aside as a loan guarantee fund to be lent to “potentially good business borrowers who just do not meet the banking sector’s collateral requirement."
The Minister said the $250 million provision “will enable $1billion in credit for business activities to reach those who would not, otherwise, be able to access the formal banking system."
Dr. Phillips also told the House that the DBJ would be facilitating $2 billion in investments, of which 25 per cent will be lent to MSMEs through microfinance institutions.
The Minister said the DBJ is currently pursuing discussions with consultants regarding development of the Jamaica Venture Capital Programme. He pointed out that ways are being explored to provide an arrangement conducive to facilitating the legal and structural needs of the MSME sector. The overall aim, he added, is to target the channeling of $1 billion into the fund as soon as the arrangements have been finalised.
The Finance Minister said the DBJ is also committed to investing $100 million in programmes geared towards providing technical assistance to MSMEs, in the hope that it will attract counterpart funding from the private sector and multilateral institutions.
“Our mission is to have new companies formed and to have the micro become small, the small become medium, and the medium become large. We want to expand the playing field. What we want to do is open a particular window or expand the window that is now available that will enable this technical assistance to be provided, so the small can become successful and eventually become the big in this economy,” Dr. Phillips said.
By Douglas McIntosh, JIS Reporter