"What does the future hold for small businesses in Jamaica?"

Small, medium and micro businesses in Jamaica face an array of challenges, not least the high cost of energy, bureaucracy and regulations, writes Nakeeta Nembhard, 25, a Commonwealth Correspondent.

The micro, small and medium enterprise (MSME) sector plays a number of roles within the social and economic space of many countries. Within the Jamaican context, the MSME sector is no less important.

While there is some difficulty in quantifying the exact contribution of the MSME sector to the Jamaican economy due to the lack of formal data, according to statistics presented by the Jamaica Business Development Corporation it has been estimated that MSMEs represent 34% of the total employed labour force with 68% of this amount relying totally on the business for their survival.

However in spite of the importance of the sector to such a large segment of the population, it is increasingly faced with a number of challenges which have come to characterize the business environment within Jamaica. Among these are the high cost of energy, difficulties in negotiating state bureaucracy, numerous regulations and the high cost of security.

According to Sean Ffrench, lecturer within the Department of Sociology, Psychology & Social Work at the University of the West Indies who specializes in microenterprises and poverty, the MSME sector does require a significant amount of support given the numerous challenges which it faces estimating that these challenges contribute the failure of 8 out of every 10 first-time entrepreneurs. He notes that an updated policy framework for the sector is needed and would allow for the facilitation of a more enabling business environment particularly insofar as MSMEs are able to address those aspects of their operations which require the most attention.

A major component therefore which should form a part of this framework is the provision of business development services (e.g. marketing training and facilitation of linkages), an area in which Ffrench notes the sector is under-supported. The provision of such services and by extension the development of the larger policy framework needs to be undertaken through public-private sector partnerships which employ extensive consultation with major stakeholders as a part of the larger effort to ensure that the development of this segment of the economy is facilitated.

However, the creation of this framework is incumbent on a shift in the perception of the MSME sector particularly by policy-makers as he suggests that “we need to stop thinking that MSME is this little man hustling on the side and need to recognize its true potential. We need to have a policy that reflects that”.

What is the future for the MSME sector therefore? Ffrench posits that with “proper policy support and the proper mix of public and private funds that the MSME will be a significant driver of development in Jamaica as it does have the potential to revolutionize employment creation and improve life for the poor and vulnerable”.

Though similar realizations have been made by a number of public sector stakeholders it has become even more imperative within the context of the need for a catalyst for growth that the MSME sector be given adequate attention due to the opportunity which it presents to allow for the empowerment of disenfranchised groups while contributing to the improvement of the economy.

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About me:

“I am a development practitioner whose particular area of interest is the relationship between people and their physical environment. My formal training has allowed me to gain an appreciation of the development process and the factors involved in achieving national development objectives.

“I hold a Masters of Science Degree with distinction in Sociology and am a recipient of the Prime Minister’s National Youth Award for Academics. Currently I am employed to the national trade and investment promotion agency, JAMPRO, as a consulting officer in planning and policy development.”

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Opinions expressed in this article are those of the author and do not necessarily represent the views of the Commonwealth Youth Programme. Articles are published in a spirit of dialogue, respect and understanding. If you disagree, why not submit a response?

To learn more about becoming a Commonwealth Correspondent please visit: http://www.yourcommonwealth.org/submit-articles/commonwealthcorrespondents/

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