August 31, 2007

Strengthening SBE’s development

by Cerlian “Maff” Russell 31.AUG.07

Small Business Enterprises (SBE’s) in SVG continue to make a major contribution to the social and economic development, and are arguably responsible for the majority of jobs created locally. The Government has created an environment for SBE’s, comprising institutional, educational, organizational and regulatory frameworks to encourage the blossoming of legitimate business activities.{{more}} This they have recognized as being important in developing an enterprise culture necessary in creating a democratic society. Government’s actions are fundamental to this enterprise culture, but to engender this enterprise culture requires not only the efforts of Government but also the efforts of all stakeholders. The aim must be to empower “bottom up” approaches to development within a national framework, in a way that rewards and enhances enterprise culture. Therefore, this framework must include, among other things, a “National Enterprise Award” to recognize and celebrate the best micro, small and medium-size entrepreneurs on an annual basis. Ask Ken Boyea and Erica Mc Intosh the impact their regional award/recognition has on them and their business?

The development of the SBE’s sector does not take place in a vacuum, it depends on the supportive and sympathetic environment created by all stakeholders, including government, regulatory authorities, financial institutions and educational institutions. These stakeholders must be entrepreneurial in their thinking and operations to facilitate and support entrepreneurship, which are key elements in creating a “level playing field” and a solid base for enterprise culture to develop. While the Government is installing capacity in areas such as CED, NIPI, Bureau of Standards etc to assist with research and the development of business plans, Banks, Credit Unions and Insurance companies must see the need to fashion special polices/plans that will support the thrust by Government. The end result will be the eventual minimization of risks to all stakeholders.

Fingers are often pointed at the financial institutions for not being sympathetic to SBE’s in making access to financing much easier. Being a practitioner myself within the financial sector, I must agree with this claim, but will equally say that financial institutions are limited in terms of credit information on customers and industry statistics, especially in these challenging times of operating in one economic space and the need for us to be creative in seeking niche opportunities. Businesses are reluctant to provide information on their performance, and credit information on borrowers is only shared through informal data-sharing by financial institutions. There are no credit information nor industry standard agencies locally or in the OECS. With the move towards CSME, and with the growing trans national movement of individuals and companies, there is the need to create a unified OECS/ CARICOM wide Credit and Industry standards Bureau that will facilitate the sharing of credit and industry standards information. Also, there is a need for the introduction of an electronic collateral registry that will facilitate faster registration and more credit control, which will allow creditors to check for existing liens on security etc. By working together and sharing the same dreams, we all could contribute significantly towards the strengthening of the framework that will allow for the creation of the right culture and a viable SBE sector.