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Oliver Kazunga Senior Business Reporter—
SMALL and Medium Enterprises and Co-operative Development Minister Sithembiso Nyoni has challenged the informal sector in Bulawayo to engage Old Mutual over the vacant premises at Nkulumane Complex as government steps up efforts to formalise their operations.
She said the government was going ahead with the programme to formalise Small and Medium Enterprises (SMEs) and her ministry would ensure only registered entrepreneurs secured premises to operate from.
Minister Nyoni said before the government chips in, associations such as the Bulawayo Chamber of SMEs should engage Old Mutual over the vacant premises.
Due to economic challenges the country went through over the years, premises at Nkulumane owned by Old Mutual, have been lying idle.
“The formalisation of the informal sector and SMEs is meant to promote growth and development of your business. Government is thus encouraging you (SMEs) to register and formalise your operations. As we formalise your operations, the premises to operate from will only be secured by those that are registered.
“We are encouraging your respective associations to approach Old Mutual over the vacant premises and as government we will also come in once you start the negotiations,” she said.
Minister Nyoni said formalisation of the informal sector was critical as it entailed that the business operates legally and without raids by law enforcement agents.
“Formalisation also avails opportunities for your businesses to secure working capital from financiers such as the Small Enterprises Development Co-operative (Sedco).
“Registering your entities as companies also protects you from falling victim to corrupt local authorities officials when it comes to allocation of premises and again you will not be evicted by corrupt politicians,” said Minister Nyoni.
In Harare, she said, 118 SMEs recently formalised their operations and were operating from Highglen Shopping Centre.
Registration and formalisation of SMEs involves all entrepreneurs in different sub-sectors that include vending and self help projects such as peanut butter, sewing and soap-making.
Of late, there has not been keen interest by entrepreneurs in the informal sector to register their operations as many want to evade remitting taxes such as Presumptive tax to the Zimbabwe Revenue Authority.
An estimated $7 billion is reportedly circulating in the informal sector and government has taken a deliberate move to formalise operations in that market in fulfillment of the Zimbabwe Agenda for Sustainable Socio-Economic Transformation provisions.
It is hoped that tapping into the informal sector through formalising SMEs’ operations would make a significant impact to the fiscus which at present is losing substantial amount of money from the untapped SMEs market.
Online Reporter