All stakeholders involved in helping Small and Medium Enterprises (SMEs) must help them stay afloat to boost economic recovery.
Currently, several SMEs in Uganda have either collapsed or urgently need financial bail-out to remain in business due to the devastating effects of the Covid-19 pandemic.
The Uganda Bureau of Statistics 2019 to 2020 economic projection indicates that the economy was expected to grow at a rate of three percent but slowed down to three percent during this period.
Mr Tony Glencross, the managing director of Nation Media Group Uganda (NMG-U), made the recovery call for SMEs while launching the Top 100 mid-sized companies 2021 survey in Kampala yesterday.
The initiative of NMG-U and KPMG in partnership with Uganda Investment Authority and dfcu Bank will assess the performance of SMEs. SMEs businesses facilitate innovation, wealth and create jobs. At least more than 2.5m Ugandans are employed by SMEs business, accounting for approximately 90 percent of the private sector.
The Top 100 survey seeks to identify Uganda’s fastest-growing medium-sized companies in order to showcase business excellence. "It should be in the interest of all stakeholders to see that SMEs are up and running given the fact that they play a very crucial role in the economy in terms of GDP, employment and tax revenue," he said.
The business environment has been characterised by exits of foreign firms such as Africell, Shoprite, and Game, among others over shrinking sales, low returns and slowed economic growth. This was attributed to the negative effects of the pandemic.
Much as the Ministry of Finance highlighted that the trend started around 2012 with exits such as Vodafone, British Airways, the pandemic has worsened it for those that had endured.
"As SMEs, we need to understand why this is happening and how to avoid more exits in the future," Mr Glencross said.
Dr Paul Kyalimpa, the deputy director general of Uganda Investment Authority, said SMEs require reduced taxes, a return to profitability and to remain key drivers of employment. He encouraged the SMEs to keep clean records & undertake audits to take advantage of the associated benefits. Mr Mathias Katamba, the CEO of dfcu Bank, said the past two years have had significant impact on SMEs, which are responsible for creating more than 70 percent of jobs.
He said SMEs should embrace digital technology to survive in this ever-changing world. "We must employ clarity, foresight and experience from the past two years," Mr Katamba said.Mr John Walugembe, […]