Financiers still reluctant to fund startups � LEA
Pauline Dikuelo | Tuesday October 24, 2017 15:27
According to the authority’s annual report for 2016/17 financial year, over the last decade, LEA has developed about 2,749 business plans worth P1.3 billion but only about 658 of them worth P277 million have been approved.
“This was mainly due to the limited financial environment faced by SMMEs, caused by low risk appetite for SMME start-ups and restrictive business loans requirements of the financial sector. “Entrepreneurs drive business success and their level of knowledge and experience is critical to the growth and survival of the business,” reads the report.
As part of its aim of nurturing entrepreneurship and SMME development, LEA has capacitated about 17,040 entrepreneurs through business mentoring, coaching and technical and business training since inception.
According to the report, the organisation has demonstrated how entrepreneurship promotion and SMME development can play a critical role in the country’s development goals of industrialisation, employment creation and poverty eradication.
During the 2016/2017 financial year, the authority offered about 2,503 various interventions to SMEs across all sectors against 1,894 targeted. The interventions included enterprise diagnostic, enterprise monitoring, business counselling and coaching amongst others. On the other hand, about 20,793 interventions were offered to the micro enterprises against a target of 25,000.
The interventions included services such as business counselling, screening, needs and gap analysis. The assistance rendered to the SMMEs resulted in a total of 727 sustainable jobs created. However, the authority attributed all their success to their three-year strategy, which is in its final year.
According to LEA’s board chairperson, Batlhatswi Tsayang the board has even resolved to continue with the strategy for the next three more years from 2017 to 2020.
Tsayang said the 2014-2017 strategy opened up their assistance to all sectors of the economy while offering differentiated service interventions to the Micro Enterprises and the SMEs as different distinct groups.
“The board has resolved that this strategy currently offers us the best route to successfully achieve our objective hence a decision was made to continue with this strategy for another three years,” he said. He added that they believe that the strategy is aligned to the National Development Plan (NDP) 11 as well as Vision 2036 as it would accelerate their ability to effectively contribute to the attainment of their goals.
In the last five years, LEA in partnership with Commonwealth Secretariat and Ministry of Investment, Trade and Industry (MITI) developed the National Entrepreneurship Policy and Strategy, which aims to improve effectiveness and efficiency of business development and financial assistance programmes and institutions.
The policy whose objective is to place “Botswana in the comity of front ranking entrepreneurial and innovative nations by 2036” will be presented to Cabinet and subsequently taken to the National Assembly for consideration.