Export Opportunities for SMEs in Developing Countries Articals Flip

Export Opportunities for SMEs in Developing Countries: Global Experiences
Distribution of MSMEs by geographic sectors urban, rural and estate
Distribution of MSMEs by geographic sectors urban, rural and estate
Figure : Distribution of MSMEs by geographic sectors urban, rural and estate
Figure : Distribution of MSMEs by geographic sectors urban, rural and estate
(Source: Non-Agricultural Economic Activities in Sri Lanka, Department of Census and
(Source: Non-Agricultural Economic Activities in Sri Lanka, Department of Census and
Statistics, 2013/14)
Statistics, 2013/14)
Chart indicates that nearly 75 % of MSMEs dispersed in rural areas of Sri Lanka. Even by the overview of this chart it clearly indicates the importance of MSMEs in the uplifting
Chart indicates that nearly 75 % of MSMEs dispersed in rural areas of Sri Lanka. Even by the
economy in the rural areas. As the initial step of finding the challenges and to provide
overview of this chart it clearly indicates the importance of MSMEs in the uplifting economy
solutions to MSMEs, the government should design and employ a proper monitoring
in the rural areas. As the initial step of finding the challenges and to provide solutions to
system. On the course, registering enterprises is very important to manage the output of
MSMEs, the government should design and employ a proper monitoring system. On the course,
MSMEs at the national level.
registering enterprises isvery important to manage the output of MSMEs at the national level.
Analysis of registered enterprises
Analysis of registered enterprises
(Source: Non-Agricultural Economic Activities in Sri Lanka, Department of Census and
(Source: Non-Agricultural Economic Activities in Sri Lanka, Department of Census and
Statistics, 2013/14)
Statistics, 2013/14)
With the above data it is crystal clear that even during the pre-crisis period MSME sector
With the above data it is crystal clear that even during the pre-crisis period MSME sector has
has performed immensely to uplift the economy of the nation by keeping its silence.
performed immensely to uplift the economy of the nation by keeping its silence. Therefore the
Therefore the importance of MSMEs in the post crisis period will be higher than the importapnrceeviofuMs ySeMarsE.s in the post crisis period will be higher than the previous years.
To identify the specific challenges faced by MSMEs in Sri Lanka during the post crisis period
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With the economic crisis, the cost of electricity, transportation and material went skyrocketing.

Export Opportunities for SMEs in Developing Countries: Global Experiences
To identify the specific challenges faced by MSMEs in Sri Lanka during the post crisis period
With the economic crisis, the cost of electricity, transportation and material went skyrocketing. Specially enterprises who engaged in importing raw material and doing a value addition for domestic sales had to close down their business or to hold their operation with the depreciation of rupee against the US Dollar. Further the Central bank had to introduce a hike in bank interest rates and it was the final nail on coffin for potential large scale investments.
With cost of production skyrocketing, political instability and economic crisis it is unrealistic to expect there will be an inflow of large scale investments. Below chart shows there is a significant loss of FDIs received by Sri Lanka during the last few years. (Source: Board of Investment of Sri Lanka)
Year
FDIs USD Billions
2017
1.7
2018
1.61
2019
0.74
2020
0.43
2021
0.6
2022
0.86
2023
0.5
Therefore the gap can be only bridged by promoting MSMEs of the country.
Therefore the gap can be only bridged by promoting MSMEs of the country.
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Figure - Increase in unemployment 5
Year Unemployment Rate

Year Unemployment Rate
2018 4.4
Export Opportunities for SMEs in Developing Countries: Global Experiences
2019 4.67
Figure - Increase in unemployment 5
2020 5.2 20
20
Year
Unemployment Rate
21
2018
4.4
5.24
2019
22
4.67
6.71
2020
5.2
2021
5.24
2022
6.71
Firstly, Hundred thousands of people lost their jobs triggered by the closure of large scale
Firstly, Hundred thousands of people lost their jobs triggered by the closure of large scale
manufacturing plants. Due to the crisis foreign aid and debts offered for construction projects
manufacturing plants. Due to the crisis foreign aid and debts offered for construction were held bpyrojtehcetsirwrersepehceltdivbeyatuhtehirorietsipeesc.tiNvearultyho1ri.t5iesm. Nilleiaornly w1.o5rkmeirllsionwewroerkemrspwloeyred in
employed in construction field and as at June 2023, more than a million of workers were
lost their jobs6.
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Secondly, the most affected area is the apparel industry. Until March 2013 more than 50 000 of apparel workers lost their jobs due to order losses from global markets and closure of factories due to cost concerns.
Also, a higher number of MSMEs have been closed due to the challenging business environment. But the figures have not yet been issued as there was not any appropriate research or statistics on the subject matter.
During last year interest rates skyrocketed and hence financing for MSMEs became a major concern for the investors. According to the industrial norm bank interest rates should be limited to single digit and Sri Lanka’s interest rates were placed just below 30%. Further lack of government assistance and lack of knowledge on the global market hinders the development of MSMEs. Currently thinking about an investor friendly environment is far beyond reality. Though it is difficult, the Government should try their level best to create an investor friendly environment.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Suggestions
It is needless to say that the resilience of the SMEs is greatly dependent on the concerted efforts of the government, SMEs operators and other policymakers. Therefore the below suggestions can be given to uplift MSMEs in reviving the Sri Lankan Economy in the post crisis period
 Proper financing system should be established with the help of government banks
Basically the most common problem with MSMEs are with financing. During a crisis the financing problems may get worse. But relating to large scale investments SMSEs need drastically less capital. Therefore MSMEs are not capital intensive and under a crisis their ability to thrive in the market is higher compared to large scale enterprises.
Though the government is in hot water with the crisis, lending some finance from government banks or motivating private commercial banks to lend to MSMEs will be a very good investment option in the short run even. Apart from commercial banks, trade credit, leasing, venture capitalists, and seeking aid of non-bank financial institutions will be other options that they will have
Crowd funding is another appropriate way of raising finance for people with creative projects to embark on their business ventures. Here they are asking and collecting relatively small amounts of money from a large number of people. Belleflamme, Lambert, and Schwienbacher (2011) 7crowdfunding is defined as collecting money for investments through social networks on the Internet.
According to the experience of the researcher, Vanilla Lanka Vanilla Grower Association Sri Lanka is a classic example of crowdfunding. There were more than 2500 vanilla grovers in the area and they wanted to establish a vanilla drying and processing plant. But not a single vanilla grover could bear such an amount of expenditure. Here what they have done is collect bearable funds from each grower and invest it in a processing plant. As the Government is not in a position to fund after a crisis they should motivate citizens to launch such innovative business practices and increase the exports of the country.
In the same manner NGOs who are interest in poverty reduction, women’s empowerment, rural development may fund on such ventures and the government or Ministry of Industry, Export Development Board, Industrial Development Board and Agriculture Department etc. should synchronize and synergize to get the optimum out of such resource persons with better coordination among all stakeholders.
There is vacuum in knowledge of MSMEs regarding the global market
As already mentioned Sri Lanka is a country where there exists a huge import - export gap. As a result of the crisis many large scale enterprises were closed
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Export Opportunities for SMEs in Developing Countries: Global Experiences
and hence the export income lowered by maximizing the trade deficit. Therefore the government bodies should intervene and shape up MSMEs to face the export market. Government agencies, Academics and experienced professionals should coordinate and arrange knowledge transferring programs or training programmes to enable them to compete in the global market.
There are few initiatives that have been taken by several agencies and they are not enough to bridge the knowledge gap and much more work to be done in this area. On the field, any government agency does not have to work on rocket science. Those bodies just have to study what our neighboring giant India is doing to become global leading exporters. Actually India has separated government bodies and qualified staff to train and assist potential business workers in every sense.
In order to bridge the gap between MSMEs with the global market, the Ceylon Chamber of commerce had taken a great initiative this year. Supporting the capacity development and growth of the small and medium enterprise (SME) sector, the Ceylon Chamber of Commerce recently held a series of workshops to facilitate the SMEs’ entry into international markets.
 The Enterprise Transformation and Market Access (ET&MA) programme developed and conducted by the Ceylon Chamber’s Centre for SMEs, offers mentorship, guidance and training to SMEs seeking to enter the global market, encouraging SMEs to develop innovative products, increase competition and generate employment8.
With the objective of strengthening MSME dynamics for resilient economic growth in Sri Lanka, the Asian Development Bank has launched a special Program called Serendipity. This is a knowledge program in ADB platform dedicated to identifying knowledge solutions for trends and challenges in MSME development and access to finance in Sri Lanka. Serendib is one of Sri Lanka’s ancient names and serendipity refers to a fortunate finding, which is a common occurrence throughout the history of product invention and scientific discovery9.
 Uplifting the ease of starting and operating a business
Though the Sri Lankan Government Authorities are much concerned on digitalizing specially after the Covid-19 pandemic, there are still some areas to be addressed. Lot of paperworks is there and for some processes entrepreneurs from rural areas have to come to the capital city as their physical presence is mandatory to sort out day to day matters.
Therefore immediate reforms should be done on such processes and must reduce person to person meets while promoting online operational models. Facilitation for potential investors in MSMEs.
According to the experience of the researcher as the committee member of the Industry Committee responsible for Central Province, Sri Lanka most of the
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Export Opportunities for SMEs in Developing Countries: Global Experiences
businessmen complained that there are many approvals to be obtained before launching a business. Further on the course of obtaining them they become helpless as government agents act in a highly bureaucratic manner. By maintaining this level of bureaucracy investors will be demotivated and business ideas would be subjected to abortions even before their birth.
Further in order to uplift the exports, an exporter friendly customs scheme should be placed. Therefore reforms in traditional custom laws are mandatory to uplift exports from MSMEs. What our neighboring India is doing is, for registered MSMEs they charge a highly reduced charge compared to large scale exporters.
Along with the crisis the government had to introduce hikes in the cost of electricity, fuel and transportation to cover up the loss of government agencies like Ceylon Electricity Board and Ceylon Petroleum Corporation. Therefore potential MSME investors were usually demotivated. Further due to import restrictions some raw materials would not be available in the country. Even if they are available, due to higher import duties prices will be unbearable for MSME sector investors. Therefore the government should intervene here and increase ease of starting and doing business.
 Should motivate people to become entrepreneurs especially targeting the youths
Sri lankans are traditionally considered as risk avoiders and their behavior supports that they are always willing to live in a comfort zone. But without gambling, responsible government agencies should motivate people to take a calculated risk and to start at least a small business venture. That may be your dream, a part time business or may be even like your hobby of creating handicrafts, cooking or sewing.
Youths are the best target group for this kind of training programs as they naturally tend to try out new things and they do have the ability to think out of the box. Sri Lanka has a population of 22 million and if the government is able to promote half a million ventures during next year, though 75% of ventures failed there will be drastic change in GDP by the remaining 25%.
 Focus much on developing household and micro level businesses
In Sri Lanka there are still hundreds of thousands of ladies who are not doing a job or resigned from their job because they do not have any other option of taking care of their children. This is the place where there is a potential to create household or micro level businesses. If a proper guide and finance aid will be provided they will surely be up to the task as they are receiving an opportunity to earn from staying at their home. Distributing basic or low cost machines among Household, Micro and Small scale businesses with an easy pay system is a popular way of battling against unemployment in many developing countries.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
There are somewhat cheap machines with basic technology needed by some manufacturing industries like pottery or food processing. Under the crisis period the Government may be able to get such machines as donations from other countries in the scheme of donations or even import as they cost few amounts. By doing this and monitoring them you can engage unemployed people while they are engaging in the GDP. But monitoring the performance of such ventures is essential and the machines provided should be retaken from failed ventures. Otherwise potential investors will not be pressured to work harder and to expand their profits.
 Amendments should be introduced to obsolete laws
In Sri Lanka, there are many obsolete laws majorly relating to Labour laws (Trade Union Act, Workers Compensation Act). They should be amended progressively. Through that process entrepreneurs should be motivated to start business ventures during this post economic crisis period. At the moment the Ministry is working towards attaining that goal.
References
1. https://www.sundayobserver.lk/2022/10/16/news-features/reviving-sme-sector
2. https://www.advocata.org/commentary-archives/2019/10/31/is-sri-lanka- keeping-its-small-businesses-small
3. https://www.macrotrends.net/countries/LKA/sri-lanka/unemployment-rate
4. Financial Innovations for SMEs in Sri Lanka, S. A. U. Niranjala, Department of Economics, Rajarata University of Sri Lanka
5. PIME Asianews web
6. Learning to Live with Covid-19, MSMEs Perception and Strategies on Business Promotions, Uva region-Sri Lanka, Imali Fernando & Nilmini Kumari, 2021
7. The Impact of COVID19 on the MSME Sector in Sri Lanka May, 2020
8. Factors Affecting Growth of Small and Medium Enterprises in Sri Lanka Asini Udani Amaradiwakara M. M. Gunatilake University of Kelaniya Sri Lanka
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Export Opportunities for SMEs in Developing Countries: Global Experiences
THE IMPACT OF EXPORT PROMOTION STRATEGIES FOR MICRO, SMALL AND MEDIUM ENTERPRISES:
A CASE OF ZIMBABWE
Ms. Letwin Nyamupinga
Business Analyst:
Small and Medium Enterprises Development Corporation,Zimbabwe [email protected]
or [email protected]
Abstract
This study analysed on the export promotion strategies currently available for MSMEs in Zimbabwe. The major essence to carry out this study is the low levels of exports in the country, especially for MSMEs. Objectives of the study were to analyse the impact of the existing MSMEs promotion strategies in Zimbabwe, assess the current levels of exports and come up with strategies on how best the export figures can be improved to in order to attain a favourable balance of trade. It was ascertained that there are various strategies and policies that have been put in place over the years with the need to boost exports in the country. Some of the initiatives include formulation of ECGC, attendance to various exhibitions across the globe, being a member to different groups that facilitate trade such as COMMESA, SADC, AU, the African Continental Free Trade Area (AfCFTA), ACP-EU and the World Trade Organisation (WTO). Various trade policies have also been enacted such as the Zimbabwe national trade policy. It is also worth to note the various Public Private Partnerships (PPPs) that have been promoted over the years. Despite these initiative exports among MSMEs are still low due to lack of information, technological barriers and high costs of start-ups. Suggestions from the study include financial assistance, training and awareness programs for MSMEs to know the exporting process and continuous promotion of PPPs.
Introduction
Micro Small and Medium-sized Enterprises (MSMEs) represent a vital segment of the economy across the world, Zimbabwe included, in contributing towards job creation, innovation, and overall economic growth. According to the World Bank MSMEs represent approximately 90% of businesses and more than 50% of employment worldwide. Formal MSMEs contribute up to 40% of national income (GDP) in emerging economies (World Bank, 2022). These numbers are significantly higher when informal SMEs are included (World Bank, 2023). According to the Zimbabwe National Statistics Agency (ZIMSTAT),
6
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Export Opportunities for SMEs in Developing Countries: Global Experiences
SMEs comprise over 90% of registered businesses in the country, employing a substantial portion of the workforce. However, despite their numerical dominance, SMEs face numerous challenges in scaling their operations and accessing international markets. Export promotion strategies emerge as a critical avenue for these enterprises to overcome domestic constraints and unlock new growth opportunities on a global scale.
Classification of MSMEs
According to OECD (2017), there is no standard international definition of Small and Medium Enterprises (SMEs) and they are defined differently in the legislation across countries, in particular because the dimension “small” and “medium” of a firm are relative to the size of the domestic economy. However their standard for SMEs is firms employing 249 people. 1 to 9 employees are considered micro, 10 to 49 people are considered small whereas 50 to 249 SMEs are considered medium. The Indian government defines an SME as a firm that employs up to 499 employees and earning not more than Rs100 million (Pachouri & Sharma, 2016). In Zimbabwe, an SME is defined as micro if the firm employs up to 5 permanent employees and earns a maximum of US$30,000, and small if employment is 40 people and annual earnings of US$500,000. They are considered medium if they employ 75 people with a turnover of US$1,000,000 (Sanhokwe, 2022). Table 1.1 below shows SMEs classification in Zimbabwe
Table 1. 1 MSMEs classification in Zimbabwe
Source: Researcher’s construct
SMEs have more flexible production opportunities compared to large enterprises; they adapt to the changes in demand in a short time and reach full competition conditions quickly (Thrassou et.al, 2020). Thus they contribute to national income, employment, productivity and entrepreneur training and exports (Makanyeza et al., 2023). In Zimbabwe, SMEs provided full-time living to approximately 4.8 million people. SMEs are contributing towards poverty alleviation, improve standard of living, and contribute towards economic stability (Saah, 2021).
Export promotion strategies: SMEs tend to be under-represented in international trade (OECD, 2017). Closer global integration increases competition for SMEs in local markets, in some cases with disruptive effects, demanding enhanced market knowledge and increased competitiveness also for small businesses that do not operate internationally (Odhiambo, 2022). According to Zimbabwe’s trade potential has not been fully tapped to enable the country to meaningfully gain from trade. Zimbabwe’s export performance has largely remained subdued over the years falling short of its potential to spur economic growth and development. A small number of SMEs export directly and for those that
Number of employees
Annual turnover (US$)
Micro
5
30,000.00
Small
40
500,000.00
Medium
75
1,000,000.00
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Export Opportunities for SMEs in Developing Countries: Global Experiences
do, exports typically represent a lower share of trade turnover (relative to larger firms) and generally target neighbouring countries. Export promotion strategies offer SMEs the opportunity to expand beyond domestic markets and contribute to sustainable development. Export promotion strategies comprise of policy interventions including exchange rate policies (Bhagwati, 1988) to any other measures that generally amount to the government bearing a portion of the private cost of production of export.
Zimbabwe has vast potential for export revenue generation, an advantage emanating from its diversified export basket. Exports have continued to sustain the economy over the years contributing more than 60% of the country’s foreign currency earnings ahead of other sources such as foreign direct investment and other remittances. Major exports from the country include gold, tobacco, metal alloys, cotton, and sugar. As of 2022, Zimbabwe’s main exports were tobacco (23 percent of total exports) and nickel (20 percent). Others include: diamonds, platinum, ferrochrome, and gold. Zimbabwe main
platinum, ferrochrome, and gold. Zimbabwe main export partners are: South Africa, China,
export partners are: South Africa, China, Congo and Botswana. The percentage exports Congo iasngdivBenotbsewloawna. . The percentage exports is given below.
2022 total exports
57%
23% 20%
Source: Researcher’s construct
Tobacco Nickel Others
Source: Researcher’s construct
Figure 1.1: Zimbabwe’s 2022 total exports
Figure 1.1: Zimbabwe’s 2022 total exports
Zimbabwe’s economy has undergone dynamic changes over the past decades, marked
Zimbabwe's economy has undergone dynamic changes over the past decades, marked by shifts in
by shifts in policies, inflationary pressures, and geopolitical factors. These fluctuations
policies, inflationary pressures, and geopolitical factors. These fluctuations have underscored the
have underscored the need for SMEs to diversify their revenue streams and reduce their
need for SMEs to diversify their revenue streams and reduce their dependency on the domestic
dependency on the domestic market. While the export potential of Zimbabwean SMEs is market.evWidheinlte,theirexacptouratlpoartteincitpialtiofnZiniminbtearbnwateioanalStMraEdesriesmeaviindsernetl,atihveilryalcimtuiateldp.aArtsicoifpationin
2022, only around 20% of Zimbabwe’s total exports were attributed to SMEs, according
international trade remains relatively limited. As of 2022, only around 20% of Zimbabwe's total
to the Ministry of Industry and Commerce. This figure highlights the untapped potential
exports were attributed to SMEs, according to the Ministry of Industry and Commerce. This figure
that export promotion strategies could harness to propel MSMEs into international
highlights the untapped potential that export promotion strategies could harness to propel MSMEs
into international markets.
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The purpose of this research paper is to delve into the impact of export promotion strategies on Zimbabwean MSMEs. By analysing the effects of various policies, incentives, and initiatives

Export Opportunities for SMEs in Developing Countries: Global Experiences
markets.
The purpose of this research paper is to delve into the impact of export promotion strategies on Zimbabwean MSMEs. By analysing the effects of various policies, incentives, and initiatives designed to facilitate MSMEs’ entry into global markets, this study aims to provide valuable insights into the challenges faced and the opportunities presented by export-oriented growth strategies. This paper aims to contribute to the existing body of knowledge concerning MSMEs’ role in national development and the potential of export promotion strategies to drive economic transformation.
Objectives
1. To evaluate the impact of the export situation in Zimbabwe.
2. To evaluate the current state of export participation by Zimbabwean MSMEs
3. To find solutions to enhance export opportunities for MSMEs in Zimbabwe
Literature Review
This section reviews existing literature on SMEs, export promotion strategies, and their impact. The review discusses theories of internationalization, the role of government policies, and market entry strategies for SMEs.
The theory of internationalisation
This theory suggests that risk exposure is attenuated and firms do escalate their resource commitments from low to high investment intensive foreign entry modes. It is concerned with entry mode choices in single markets based on transaction cost analysis. In this theory lacking foreign market knowledge is a central construct. Lacking foreign market knowledge increases risk exposure to the internationally expanding firms, to which it responds through either limited resource commitment (stage models of internationalization) or high control modes (internalization theory). If there is lacking knowledge about foreign markets, firms limit their risk exposure through limiting resource commitment. The theory is relevant as it emphasises on market knowledge before investing in a foreign market.
Government policies and strategies
There are various export promotion policies and strategies which were implemented by the government of Zimbabwe towards boosting the economy in terms of improving balance of trade towards a positive Balance of Payment. .The Zimbabwe National Trade Policy Vision and Export Promotion Strategy towards Vision 2030 Agenda seeks to propel Zimbabwe’s industrialisation towards a transformed and internationally competitive economy driven by robust free and fair domestic and international trade. The National Investment Policy, Zimbabwe Industrial Development Policy (2019-2023) and the Zimbabwe National Trade Policy (2019-2023) are key policies in export promotion. Zimbabwe has trade agreements under SADC, COMESA, the African Continental Free Trade Area (AfCFTA), ACP-EU and the World Trade Organisation (WTO) and
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Export Opportunities for SMEs in Developing Countries: Global Experiences
African Union (AU). The government has also been promoting public- private sector collaborations towards export promotion.
Market entry strategies for MSMEs
Zimbabwe does trade fairs across the 10 provinces of the country with the main being (Zimbabwe International Trade Fair) ZITF held in April and the Zimbabwe Agricultural Show (ZAS) held in August every year (Shereni et al, 2021). These are meant to improve trade, increase market linkages and product development.
The contribution of SMEs to innovation dynamics has increased in recent decades, as income growth, market demand and changing technologies have enabled SMEs to strengthen their comparative advantages and reduced the structural disadvantages stemming from resource constraints and limited ability to reap economies of scale. Globalisation has increased the necessity of cross-border collaboration in obtaining inputs for innovation (ideas, finance, skills, technologies) from abroad and in exploiting its outputs (products and services, patents, licenses, etc.) in foreign markets. However, a key challenge for many SMEs is to identify and connect to appropriate knowledge partners and networks at the local, national and global levels, as well as to develop appropriate skills and management practices for co-ordinating and integrating knowledge created by external partners with in-house practices and innovation processes. The landlocked and fragile countries’ ability to create a sustainable path to economic growth and poverty reduction is inextricably linked to their export diversification potential, itself related to their connectivity within themselves, in the region, and other external markets (Pitigala et al, 2021).
Stronger participation by SMEs in global markets can help to strengthen their contributions to economic development and social well-being, by creating opportunities to scale up, accelerating innovation, facilitating spill-overs of technology and managerial know- how, broadening and deepening the skill-set, and enhancing productivity (Madison et al, 2022). In addition, greater flexibility and capacity to customise and differentiate products can give SMEs a competitive advantage in global markets relative to larger firms, as they are able to respond rapidly to changing market conditions and increasingly shorter product life cycles.
Export- related barriers to MSMEs in Zimbabwe:
1. Financial resources
2. Lack of information
3. Insufficient readiness for export
4. Customs and tax problems and insufficient export subsidies.
5. Poor communication network.
Effectiveness of Export Promotion Policies for SMEs
The effectiveness of export promotion policies has been extensively studied across various countries. Al-Mansour et al. (2017) examined the impact of the Saudi Arabian
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Export Opportunities for SMEs in Developing Countries: Global Experiences
government’s export promotion initiatives and found that financial support and export- oriented training positively influenced SMEs’ export performance. In a different context, Hernandez and Du (2017) investigated China’s export promotion policies and highlighted the role of trade fairs and exhibitions in facilitating SMEs’ market entry. These studies underscore the importance of proactive government interventions in supporting SMEs’ internationalization.
Methodology
This study employed a secondary data analysis approach to examine the impact of export promotion strategies on SMEs in Zimbabwe. Secondary data analysis is effective in inveDstaitgaaAtninalgystirseandsP,repsoenlitcatyionoutcomes, and challenges without the need for primary data colleAcntion nde(pBthadzaetaleanya,ly2s0is1p8re)s.entation and interpretation in line with existing source was done.
Data was presented graphs. Data analysis will be applied systematically and logical technique
Data Analysis and Presentation
used in order to establish the resultant impact of Government export promotion initiatives on
An in depth data analysis presentation and interpretation in line with existing source was
MSMEs export promotion in Zimbabwe.
done. Data was presented graphs. Data analysis will be applied systematically and logical
technique used in order to establish the resultant impact of Government export promotion
The government of Zimbabwe through its agencies have embarked on so many initiatives to
initiatives on MSMEs export promotion in Zimbabwe.
promote exports and they have slowly improved over the years although there is still a lot that
The government of Zimbabwe through its agencies have embarked on so many initiatives
needs to be done to improve the economy which is currently a net importer. An analysis of the
to promote exports and they have slowly improved over the years although there is still
country’s exports for the past ten years is given below;
a lot that needs to be done to improve the economy which is currently a net importer. An analysis of the country’s exports for the past ten years is given below;
Figure 2.1. Zimbabwe exports from 2012-2022
Figure 2.1. Zimbabwe exports from 2012-2022
Source: statistica
Source: statistica
AspAesrpethrtehefifgigureabaobvoe,viet,caintbceanotebdethnaotetexpdorthsavotluemxephoarstsbevenoilnucmreaesinhgaosvebretehenyienarcsreasingover theyalethaorusghalththeofiguugrehsatrheemfiovginugreatsaaslroewmpaocev,irenfglecatitngathselonewedpfoarceexp,orretflpreomctoitniognstthraetengieesdforexport
promotion strategies among MSMEs so as to improve on the trade balance.
among MSMEs so as to improve on the trade balance.
Effectiveness of Export Promotion Policies
The effectiveness of existing export promotion policies and initiatives in Zimbabwe was assessed. 55 The analysis covers the role of government agencies, trade agreements, and incentives in
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Effectiveness of Export Promotion Policies
The effectiveness of existing export promotion policies and initiatives in Zimbabwe was assessed. The analysis covers the role of government agencies, trade agreements, and incentives in supporting SMEs’ internationalization efforts. Collaborative efforts between government agencies, industry associations, and development partners are pivotal in creating a conducive environment for MSMEs, fostering knowledge sharing, and providing necessary support for navigating the complexities of international trade regulations.
Findings
The study findings include the following:
1. There has been emphasis on the importance of effective export promotion strategies for the growth and sustainability of Zimbabwean SMEs.
2. Analysing export growth trends over the past five years reveals a notable uptick in MSMEs’ engagement in international trade. The value of MSME exports has increased by an average of 12% annually, highlighting the positive impact of export promotion initiatives. Notably, sectors such as agribusiness, textiles, and handicrafts have shown significant export diversification, indicating successful targeting of these segments through EPS.
3. From the research it has been noted that there are various export promotion strategies available for MSMEs such as ECGC and various trade zones and policies which they can utilise and drive export volumes.
4. Challenges being faced by MSMEs include lack of information and financial resources to tap into the export market.
Financial Incentives:
Financial incentives, such as export grants and subsidies, have demonstrated tangible outcomes for MSMEs. A detailed examination of data indicates that MSMEs that utilized these incentives reported an average export revenue increase of 20% within the first year of participation. However, a critical observation reveals that long-term sustainability remains a challenge, as some MSMEs struggled to maintain growth beyond the initial boost provided by the incentives.
Capacity-Building Impact:
Capacity-building programs have been pivotal in improving MSMEs’ export readiness and competitiveness. An analysis of skills development workshops and quality improvement initiatives showcased a noticeable enhancement in product standards and compliance with international regulations. This translated into a 15% increase in export volume for MSMEs that actively participated in these programs.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Digitalization and E-commerce:
The integration of digital platforms and e-commerce channels has been a transformative force in MSMEs’ export journeys. Over the last three years, MSMEs adopting e-commerce reported a staggering 40% growth in international sales. This highlights the importance of digital readiness in accessing global markets, reducing trade barriers, and enhancing overall efficiency in cross-border transactions.
Collaborative Efforts:
Government collaborations with industry associations and development partners have yielded substantial outcomes. Analysis of partnerships revealed that MSMEs operating within established clusters experienced a 25% increase in export value compared to those operating in isolation. This underscores the significance of collective efforts in knowledge sharing, resource pooling, and navigating complex trade regulations.
Suggestions
Despite the positive trends, challenges such as inconsistent policy frameworks and limited access to financing continue to impede MSMEs’ export potential. To address these issues, policy recommendations include the establishment of a dedicated export financing mechanism tailored to MSMEs and the creation of a more predictable regulatory environment to encourage long-term planning and investments. Based on the findings, this section provides recommendations for improving the effectiveness of export promotion strategies for Zimbabwean SMEs:
1. Recommendations include enhancing financial support mechanisms,
2. Providing targeted training and capacity-building programs, streamlining regulatory processes, and leveraging digital technologies for market access.
3. ZIM Trade, through the Ministry of Foreign Affairs and International Trade, should continue to propel programs that integrate previously marginalized groups in export business.
4. A focus on the development of provincial clusters assists in leveraging Zimbabwe’s natural endowments for export, and also creates opportunity for smallholder farmers across the country to contribute to national exports and also improve their standard living, leading to economic growth and development.
5. It is recommended that policy makers keep on coming with innovative strategies so as to promote exports in Zimbabwe, It underscores the need for continuous evaluation and adaptation of policies to address evolving challenges.
6. Other recommendations include investing in technological advancements, e-commerce, and changing consumer preferences on export promotion strategies to fully benefit from the export market.
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References
1. Madison, K., Moore, C. B., Daspit, J. J., & Nabisaalu, J. K. (2022). The influence of women on SME innovation in emerging markets. Strategic Entrepreneurship Journal, 16(2), 281-313.
2. Makanyeza, C., Mabenge, B. K., & Ngorora-Madzimure, G. P. K. (2023). Factors influencing small and medium enterprises’ innovativeness: Evidence from manufacturing companies in Harare, Zimbabwe. Global Business and Organizational Excellence, 42(3), 10-23.
3. Odhiambo, N. M. (2022). Is export-led growth hypothesis still valid for sub- Saharan African countries? New evidence from panel data analysis. European Journal of Management and Business Economics, 31(1), 77-93.
4. OECD, P. (2017). Enhancing the contributions of SMEs in a global and digitalised economy. Paris. Retrieved August, 14, 2023.
5. UN Academy. (2023, 08 14). Role and Contribution Of SMEs. Retrieved from UN Academy: https://unacademy.com
6. World Bank. (2023, 8 14). Small and Medium Enterprises (SMEs) Finance. Improving SMEs’ access to finance and finding innovative solutions to unlock sources of capital. Retrieved from World Bank: https://www.worldbank.org/en/ topic/smefinance
7. Statistica (2023, 8 14). https://www.statista.com/statistics. Retrieved from Statistica: https://www.statista.com/statistics
8. World Bank. (2023, 8 14). Small and Medium Enterprises (SMEs) Finance. Improving SMEs’ access to finance and finding innovative solutions to unlock sources of capital. Retrieved from World Bank: https://www.worldbank.org/en/ topic/smefinance
9. Sanhokwe, H. (2022). Reimagining the SME failure phenomenon: incorporating regenerative effects and predicting enterprise regenerative capacity. Journal of Entrepreneurship in Emerging Economies.
10. Thrassou, A., Uzunboylu, N., Vrontis, D., & Christofi, M. (2020). Digitalization of SMEs: A review of opportunities and challenges. The Changing Role of SMEs in Global Business: Volume II: Contextual Evolution Across Markets, Disciplines and Sectors, 179-200.
11. World Bank. (2023, 8 14). Small and Medium Enterprises (SMEs) Finance. Improving SMEs’ access to finance and finding innovative solutions to unlock sources of capital. Retrieved from World Bank: https://www.worldbank.org/en/ topic/smefinance
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Export Opportunities for SMEs in Developing Countries: Global Experiences
7
EFFECT OF TRADE BARRIERS ON SME EXPORTS IN KIRIBATI
Ms. Bwereia Ienimango
Peer Educator, Kiribati Family Health Association, Kiribati [email protected]
Abstract
Ms Eriteti Mikaere
AS, MTCIC, Kiribati [email protected]
The present study investigated the trade barriers facing small and medium enterprises in Kiribati to derive feasible strategies to boost trade domestically and internationally. Kiribati is a low-lying atoll country with limited resources and opportunities; however, it is fortunate to assess and learn feasible strategies from other perspectives especially India that would be beneficial to the trade industry in Kiribati. The Kiribati vision known as the 20-year development blueprint (KV20) where it seeks effective strategies to foster inclusive trade and private sector development is another driving factor to this study. The domestic and international Trade in Kiribati are very crucial and important however trade barriers identified in the study were discussed and analyzed for effective strategies to progress trade in Kiribati and this is the main objective of this study. The Kiribati Trade Policy Framework (TPF) was another effective strategy along with others identified in the study. Also, the study found interesting initiatives in India which are boosting trade such as districts as Export Hub; one district one product, it was an interesting initiative and another effective strategy for Trade in Kiribati.
Introduction
The study will discuss trade barriers in Kiribati facing SMEs in Kiribati, and to identify effective and feasible strategies that would help the country to address existing trade barriers in looking at the perspectives of India and Kiribati.
Domestic Trade is the buying and selling of goods and services within the confines of the international boundaries of a nation. International trade is referred to as the exchange or trade of goods and services between different nations. This kind of trade contributes and increases the world economy. The biggest hurdle for most SMEs is understanding market dynamics and who they are selling to. Definitions of SMEs are different country by country. In some countries the criterion for the categorization is capital, in some countries it is based on the number of employees, and other countries use a mixed criteria like Japan, and it varies in each business.
Kiribati is one of the developing countries with scarce resources in the world; its population is just over 120,000 , more than half of whom live in the capital city called
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Tarawa. Nonetheless, economic activity is constrained by isolation, sparse resources, and a fragile environment. The government of Kiribati found it that most of business activities are carried out in the capital city Tarawa, where most business opportunities are to be happening. Kiribati is now a member to few trade agreements, as to boost trade or export to overseas market.
Trade is all over the world and its crucial role in the economy is very big. Trade barriers can be challenging, but not insurmountable when exporting to a new and successful market, but how to find that right market?
The barriers facing Kiribati SMEs are listed below:
i. Freight Levy Refund
ii. Conflicting Policies
iii. Micro - Finance
iv. Limited land and water supply for commercial use
v. Isolation from major markets and poor connections
vi. Small population and lack of scale
vii. Geographical disbursement of population
viii. Inadequate basic infrastructure
ix. Insufficient skills
x. Lack of investment and a poor business environment
xi. Vulnerable to climate change
There are initiatives developed by the government of Kiribati to address this, however the barriers cannot be addressed in the blink of an eye, but the work should be progressing. The government of Kiribati developed a policy called a Trade framework policy. The policy is a 10-year policy where the government clearly states important matters related to Trade such as issues facing trade and potential measures to address or eliminate the trade barriers. The TPF is the first integrated trade policy document on trade related matters in Kiribati. The policy fills an important gap in the country’s overall policy framework for economic transformation, which has so far relied on a horizontal treatment of trade issues coupled with some selected trade-specific measures. It sets out the importance of trade for Kiribati as well as the overall mechanisms through which Kiribati can use trade as a tool for inclusive and sustainable development in line with national development strategies.
Government of India has introduced many effective initiatives for SMEs Export. The study found two interesting and effective initiatives taught at the Ni-MSME classes and they are:
a) District as export hub, known as One District and one Product.
b) The ECGC Limited.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
There are 766 districts in India, and they all have this one unique product for export. The initiative is where one district is responsible for working on that one product to export. Having one product for export from 766 districts eased the load and cut costs on the government where instead of producing many kinds of products from a district, it only concentrated on one product. The product was accessed/examined from different angles, where the end-product would perfect and meet the standards.
The Export Credit Guarantee Corporation of India Limited (ECGC) is another interesting government initiative to support export. This is a government enterprise, and it is very interesting that India has this support by their government. Business in India only focuses on their export while ECGC covers the risk. In this manner, the export will boost up in India where the most common challenge in the Trade industry is the accessibility to world market. A particular business cannot be certain whether it is communicated with the right partner or targeting the right market; all these doubts are always in the mind of an exporter when first starting up. But having this enterprise, it would be easy for businesses in India to approach them and ask for help prior starting their export. This is very helpful, and it would lead to an increase in Trade activities in future.
Objectives
The focus of this report is to study trade barriers facing SMEs in Kiribati, to determine the most effective and feasible strategies that could be adopted in Kiribati from many studies, from Kiribati itself and lessons undertaken at Ni-MSME(India) to help to eliminate trade barriers. There are successful initiatives produced and practiced in India which Kiribati could learn from for trade sustainability in Kiribati.
To achieve the objective mentioned above, the following actions were examined:
a) To study the status of domestic and international trade in Kiribati – Where are we now with Trade, locally and internationally,
b) To find out trade barriers facing SMEs in Kiribati
c) To analyze other studies including India perspective related to trade barriers,
d) To identify effective and feasible strategies to eliminate trade barriers from Kiribati, India government initiatives for trade and literature reviews from other scholars,
e) To note strategies works in Kiribati for way forwards.
Literature Review
According to Yoshino and Taghizadeh-Hesary , ‘many small and medium-sized businesses find that their geographical isolation puts them at a competitive disadvantage’. It is true, Kiribati is facing the same challenge where it was in the Pacific Ocean where the opportunity to trade is so little. Not only that but these authors emphasized that difficulties in accessing finance is also what the Asia countries faced, where Kiribati as well faced. They also mentioned that ‘many banks prefer to allocate their resources to large enterprises rather than to SMEs. The reason is that large enterprises have a lower
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Export Opportunities for SMEs in Developing Countries: Global Experiences
risk of default, and their financial statements are clear. However, SMEs are riskier mainly from the point of view of lenders and they do not have clear accounting information. This is experienced with SMEs in Kiribati as well where small businesses have difficulties in accessing finance from banking institutions.
Yoshino and Taghizadeh-Hesary came up with three strategies in easing SME financing by developing (i) credit guarantee schemes by governments, (ii) private SME lenders, and (iii) hometown investment trust funds for financing risky SMEs and start-up businesses. Kiribati learns a lot from these strategies and could adopt the first which is the credit guarantee schemes by government as currently there is a package or scheme introduced by one of the government bank institutions where SMEs could access finance/loans for their startups. The scheme has been carried out and a success so far for others, where a few Kiribati SMEs had access and managed to build their businesses and now make income. But still other SMEs couldn’t access the scheme unlike before where the majority cannot access the scheme. So, this is progressing and good to learn that in the Asian regions is also adopting the strategy.
Methodology
The methodology used in the study is collection of data through the trainings here at Ni- MSME, research made through studies or books related to Trade barriers and interviewing concerned bodies over the emails and extracted relevant information from the Kiribati government’s Trade policy, called Trade Policy Framework.
There are challenges or limitations to data collection as this report was only made and prepared for a short period of time, therefore the data or results derived out of this report was limited to a specific scope.
Findings
Kiribati is a trading nation, receiving significant levels of income from a variety of sources and purchasing significant levels of goods and services in return. A feature of Kiribati’s overseas trade is that while Kiribati generates revenue from abroad, the small size of the economy means that it relies heavily on imported goods to meet its essential needs.
There are challenges facing domestic trade in Kiribati such as: 1) Freight levy refund, 2) limited inter-island connectivity, 3) poor marketing infrastructure where producers can store and sell their goods, 4) inadequate skills amongst private sector groups on supply chain management, 5) a general lack of awareness amongst producers on the opportunities available within the domestic market for programmes, 6) a lack of awareness on how to make use of new technologies such as ICTs to facilitate domestic trade by improving buyers and sellers’ connectivity along the supply chain.
Looking at the international trade, a few of trade barriers are: 1) freight Levy Refund, 2) Conflicting policies, 3) Micro-Finance issue, 4) Isolation from major markets and poor connections, 5) Geographical disbursement of population, 6) inadequate basic infrastructure, 7) insufficient skills, 8) lack of investment and a poor business environment and many more.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
The three major trade barriers are, the freight Levy Refund - it is affecting both domestic and international trade in Kiribati. The Freight refund initiative is a government initiative to compensate for freight charges sent to outer islands and likewise for goods imported from overseas market. The Ministry of Finance is responsible for releasing such payment. There are 5 documents needed to access this scheme. Failure to submit one of these will lead to funds not being released. Businesses on South Tarawa islands (wholesalers) received orders from outer islands. Then they (wholesalers) paid the freight of these cargoes to shipping agencies with the understanding that compensation for such freight will be paid back asap. However, this could take months. Thus, their cash flow is affected as we are talking of thousands (10+) each company may spend on about 3 shipments within a week. Then it was agreed that 50% of the business claim will be released first once cargoes are sent to outer islands and the other 50% is to be released once all documents are submitted. This is not effective and wholesalers still suffer and threatens to stop sending cargoes to outer islands. The second meeting convened again, and this time the Ministry of Finance agreed to pay the consignees from the outer islands. This payment is to be made through the island councils. This is more chaotic as consignees (mostly retailers) do not understand procedures. Since they are the ones to meet their shipping cost, they complain as this affects their order tremendously. Wholesalers who have their branches on the outer islands suffer also as they are not allowed to claim as ‘consignee’ definition is for retailer only.
The second one is the conflicting policies between Kiribati Port Authority and Shipping Agencies. This is an example of some polices that are conflicting. According to the shipping agencies, 14 days are allowed for importers free of charges for containers once ships arrive. After that, $140 per day is to be paid which means that exporters are to return their containers to KPA after 14 days to avoid being penalized. KPA’s policy on the other hand, only allows containers to be returned 10 days before the arrival of ships to avoid congestion.
And the third one is the micro-finance issue, there are only two existing bank institutions in Kiribati known as ANZ/Bank of Kiribati and Development Bank of Kiribati. The policies attached to loan systems are very stringent and thus negatively affect business operators (to expand) and even whoever who wishes to venture into small business (starters). Applying for a loan is very complicated especially in Kiritimati Island (remoteness) and time consuming. Stringent policies were developed based on experience with business defaults and failed to repay loan. The Government through my Ministry is making proposal on how to assist business operators and public through a loan scheme for small businesses. The problem is still facing some SME where some other required documentation and all are preventing SMEs from accessing the scheme, but fortunately accessible to others.
In figure 1 below, it shows that the balance of trade got larger and larger as years go on. There is a need to settle the gap difference as by looking into other studies carried out in different countries especially in India. There are initiatives introduced in Kiribati
63

fortunately accessible to others.
n t l
e
e c
2
In figure 1 below, it shows that the balance of trade got larger and larger as years go o
Export Opportunities for SMEs in Developing Countries: Global Experiences
a need to settle the gap difference as by looking into other studies carried out in differen
especially in India. There are initiatives introduced in Kiribati government, but it is a
government, but it is also crucial to learn feasible strategies to eliminate trade barriers by
other countries and studies.
to learn feasible strategies to eliminate trade barriers by other countries and studies.
Figure 1. Import and Exports, 1974 to 2016
Trade is happening in Kiribati as shown in figure 1, Kiribati is importing more than
Figure 1. Import and Exports, 1974 to 2016
exporting. Each country has their unique products which could be exported in massive
quantities if the marketing of that product is widely addressed but how? In India, there
Trade is happening in Kiribati as shown in figure 1, Kiribati is importing more than
is an initiative from the government where one district has one product to export. It is
Each country has their unique products which could be exported in massive quanti
clearly shown that each district must concentrate on that only product and nothing else targeting the locals or internationally. It is wise to concentrate on one product by each
marketing of that product is widely addressed but how? In India, there is an initiativ
district as India worked on, however in Kiribati the businesses could adopt this but not by
government where one district has one product to export. It is clearly shown that ea
district but an island. We have 32 islands therefore each island could determine what are the unique products their island could produce for export. Instead of wasting resources and power in abundance products they only work on one unique product for marketing or exporting.
While trade barriers hinder trade, free trade agreements (FTAs) eliminate most barriers and create new opportunities. While tariff elimination may be the main goal, agreements can extend into other areas and cover non-tariff barriers including quotas, product standards, labour, and intellectual property. Kiribati has joined few trade agreements to eliminate barriers, such as Pacer plus to mention one. These agreements are helpful to the government of Kiribati and plays an important role in the trade sector. Kiribati is participating in these agreements and hope to join more with other countries in future. Also, the government has produced a policy where the trade portfolios are all listed for guidance, known as Trade Policy Framework.
Suggestions
From the trade barriers mentioned above, the three important and current ones now are 1) freight Levy Refund, 2) Conflicting policies, 3) Micro-Finance issues. These are some of the suggestions for the government of Kiribati to consider for eliminating trade barriers:
6
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Export Opportunities for SMEs in Developing Countries: Global Experiences
For the freight Levy Refund, there have been bilateral discussions took place between Ministry of Finance and Kiribati Chamber of Commerce and Industry several times to solve this. Recently, discussions convened again, and this time Ministry of Finance agrees to include wholesalers who have branches on outer islands which is more stress free for SMEs in the capital. Moreover, the Ministry of Finance seeks approval from the Cabinet to ease the refund process by submitting only 1 document (Bill of lading) and not 5 documents. This awaits cabinet approval but the looks of it and this will be supported. The conflicting policies between ministries bodies is also serious in Kiribati. There are reviews needed by the government since most of the laws/acts were created many years back. It is commonly seen that the accessibility to finance is very hard and complicated by SMEs in Kiribati. The government works with bank institutions to address the problem and the great news was there is a scheme provided by this loan institution for startups or improving businesses, they can access finance through this scheme. Yoshino and Taghizadeh-Hesary also emphasized the credit guarantee schemes by governments is a very good initiative. Also, the initiative from India Government for SMEs where it focuses on one district one product. It is very interesting to learn this initiative and believes that this could work in Kiribati for boosting up trade where trading from one island to another island is much necessary and not district.
The ECGC Limited is also effective where Kiribati could adopt when the time is right (financial problems ease). This initiative gives confidence to those who are in trading business where there is support from the government in securing that their businesspeople are safe and secure.
The trade policy framework produced by Ministry of Tourism, Commerce, Industry and Cooperatives is so effective and should be supported by government officials and businessmen where in the end, a win-win situation is achieved.
References
1. Naoyuki Yoshino and Farhad Taghizadeh-Hesary, ‘Major Challenges Facing Small and Medium-sized Enterprises in Asia and Solutions for Mitigating them,’ ADBI Working Paper Series, April 2016.
2. Kiribati National Statistic Office, Census, 2020, Ministry of Finance, Economic Development
3. Kiribati Trade Policy Framework 2017 – 2027, Ministry of Industry, Commerce, Tourism and COOPERATIVES.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
8
Abstract
CHALLENGES FACED BY MICRO, SMALL AND MEDIUM ENTERPRISES IN CASAVA’S EXPORT PROMOTION IN CAMEROON
Mrs. Veronique Bekono
Chef DE Service, MIPMEESA, Cameroon [email protected]/ [email protected]
SMEs as an important lever for achieving objectives in terms of wealth creation, reduction of unemployment and underemployment, but also a major asset for the competitiveness of our economy with regard to the diversity of activities it promotes.The agriculture sector in Cameroon is a vital part of the country’s economy, employing millions of people and contributing significantly to GDP. However, the sector faces a number of challenges, including climate change, poor infrastructure and limited access to markets. A number of tasks can be undertaken to strengthen casava’s export promotion sector policies and operations in Cameroon.
Introduction
In December 2020, the Cameroonian Government adopted the new reference framework for the implementation of the second phase of Cameroon’s vision for 2035: the National Development Strategy 2020-2030 (SND30). This Strategy aims at the structural transformation of the national economy by emphasizing the development of the industry and services sector. Thus, for the period 2020-2030, Cameroon’s ambition is to increase the quantity and quality of the production of agricultural products in order to ensure its food self-sufficiency, to supply the growing demand of national agro-industries for raw materials agriculture and to conquer international markets. Achieving this objective necessarily induces the compliance of agro-industrial production.
As a result, the State of Cameroon has retained Small and Medium Enterprises as important levers for the growth of its economy. Representing more than 94% of all national businesses, SMEs contribute around 36% of GDP and are today more than in the past at the heart of Cameroon’s development strategy.
Objectives General objectives:
1. Increase the availability and quality of cassava flour on local markets in Cameroon to export.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
2. To identify the key issue impeding MSMEs’ expansion in Cameroon export promotion.
3. To identify the obstacles that the casava value chain has faced as it has grown and to give recommendations for how to make each link in the chain more competitive in Cameroon.
Specific objectives:
1. Support stakeholders in the standardization and compliance of their products;
2. Facilitate access to packaging;
3. Promote the consumption of local products made from cassava flour;
4. Develop regional incubation centers in the cassava sector;
5. Promote the creation of small manufacturing units of bread-making cassava flour intended for industrial or artisanal bakers;
6. Stimulate productive interactions between actors in the cassava sector;
Review of Literature
The agro-industry sector appears to be an important lever on which the Government must act in order to contribute substantially to the achievement of the objectives of the import-substitution mix policy and promotion of exports under the prism of development and competitiveness. agricultural products. In Cameroon, agro-industrial products mainly from agriculture (raw materials) remain insufficient to meet national demand (in terms of household consumption and the needs of local processing units) due, among other things, to low mechanization of farms, land constraints limiting the extension of industrial plantations, energy deficit for industrial production, high cost of inputs needed for production/processing (improved seeds, machinery and equipment),
the lack of improved seeds; hence the imports of food products which form a significant part of the trade balance deficit. By way of illustration, a study by the Business Upgrading Office (BMN) revealed that for the year 2020 alone, Cameroon imported nearly 830,000 tonnes of wheat worth 180,000 billion FCFA, it means that a 30% increase in value and 12% in quantity compared to the previous year.
However, in view of the soaring wheat prices due to the Russo-Ukrainian crisis, the price of which per ton on the world market rose from 200,000 FCFA at the end of 2021 to 280,000 FCFA in March 2022, the inflation of The price of products made from wheat flour, in particular bread and pasta, is an economic, financial and social issue. Thus, to counter the import curve in favor of local flours made from cassava, sweet potato, plantain, coco yam, yam, maize, sorghum, etc., the Government wants to strengthen agricultural production and processing through the implementation of implementation of the import-substitution policy, and hence, economic patriotism and national preference. However, the prospect of substitution of wheat flour by that of local starches is worrying due to the availability in sufficient quantity and the uncompetitive price of local flours
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Export Opportunities for SMEs in Developing Countries: Global Experiences
likely to break the supply chain.
Thus, to overcome this problem, it will be a question of investing in a project to increase the agricultural production of cassava in order to satisfy not only the food needs of the populations, but also of the agro-industries with a view to transformation. in large scale.
The achievement of such an objective could not be achieved without targeted support measures in favor of SMEs in the cassava sector for an improvement of the local supply in terms of quality and quantity of cassava flour.
The synoptic table below presents the opportunities, challenges and issues of the agro- food sector in general and the cassava sector in particular;
Cassava is one of the most important food crops due to its level of consumption (intermediate and final in Cameroon). Indeed, in 2018 its national production was estimated at 2,882,734 tons, with an average yield of 14.4 tons/hectare. In addition, during the period 2014-2018, the national production of cassava increased from 4,812,240 tons to 5,582,387 tons with a forecast estimate of 6,000,000 tons in 2020. Despite the strong local demand for this crop qualified as “White Gold”, it struggles to deploy its full economic potential, due to weak processing; because it should be noted that throughout the national territory, there are only three main centers for processing cassava into flour and other by-products, apart from artisanal production. These include the South, South West and North regions.
Methodoly
WHAT: Improve the quantity and quality of local flour supply in Cameroon: case of
cassava flour.
WHO: Government (sectoral administrations, agricultural desk, APME, Agrifood Processing Center, IRAD, ENSAI, ANOR, BMN, LANACOME, CAPEF, PNPE, Private sector (Approved incubation centres, GIE, PROFALCAM, agricultural cooperatives: including those women and young people, professional associations of SMEs) and Decentralized Territorial Communities (CTD).
How:
- Disseminate processing, conservation, marketing and storage techniques;
- Strengthen the capacities of cassava flour stakeholders;
- Promote the development of value chains in the cassava sector;
- Technically and financially support players in the cassava sector;
- Equip actors in the cassava sector;
- Support players in the standardization and compliance of their products;
- Facilitate access to packaging;
- Promote the consumption of local products made from cassava flour;
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- -
-
Export Opportunities for SMEs in Developing Countries: Global Experiences
Develop regional incubation centers in the cassava sector;
Promote the creation of small manufacturing units of cassava flour for breadmaking intended for industrial or artisanal bakers;
Stimulate productive interactions between actors in the cassava sector;
Advocate with ANOR for the development of the Cameroonian standard for cassava flour.
When: 2024-2025
Data Analysis
Focus on quality: Cameroonian consumers are increasingly demanding high quality food products. Companies that can produce high-quality products that meet consumer needs will be well positioned to succeed. This includes using high quality ingredients, adhering to strict food safety procedures and ensuring that products are always produced to high standards;
Entering new markets: As the Cameroonian market is relatively small, companies have the opportunity to expand into new markets. This may involve exporting products to other countries or selling products to new segments of the Cameroonian market. For example, companies could target urban consumers who are increasingly demanding convenience foods;
Partner with other businesses: Businesses in the food industry can partner with other businesses. For example, they can partner with farmers to source high-quality ingredients, or with distributors to reach a wider audience. Partnerships can help companies share resources, reduce costs and grow faster.
Inadequate infrastructure. Cameroon’s infrastructure is not well developed, which can make it difficult for businesses to transport goods and access markets. This problem is particularly acute for businesses located in rural areas;
Limited access to credit. Cameroonian companies often have limited access to credit, which can prevent them from investing in their activities. This is a particular challenge for small businesses.
Despite these challenges, businesses in the food industry in Cameroon have a number of opportunities for success. By seizing opportunities and overcoming challenges, businesses in Cameroon’s agribusiness can grow.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
FINDINGS
Results (Short term)
Results (Long term)
Technical effects
Technology transfer
Promote the creation of new cassava production units, particularly in specialized economic zones
Master production techniques
Strengthen the technical production, processing, storage and marketing capacities of MSMEs involved in the cassava sector;
Economic effects
GDP increase
Contribute to reducing the trade balance deficit
Limit imports of flour (wheat in this case) and encourage the production of local flour to export
Increase the number of Specialized Economic Zones (particularly that of Edéa) in the cassava sector
Promote export and enhance the consumption of cassava flour
Social and environmental effects
Job creation
Promote and enhance the consumption of cassava flour
Empowerment of women and young people
Reduce the unemployment rate through job creation in the cassava sector
Structuring MSMEs in the cassava sector
Suggestions
Cameroonian farmers often face difficulties in marketing their products. This is due to the lack of infrastructure, as well as the fact that many farmers are not organized into cooperatives or other marketing groups. The government must take steps to improve the marketing of agricultural products, to ensure that farmers receive a fair price for their crops;
The agri-food industry has the potential to create jobs and generate foreign exchange earnings. The government should promote the development of this industry by providing tax breaks and other incentives to investors.
These are just some of the tasks to be undertaken to strengthen the policies and operations of the export promotion casava in Cameroon. By taking these steps, the government can help improve the country’s export and the prosperity of its farmers.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
In another’s cases the government have to:
➢ strengthening of economic cohesion;
➢ rise in the level of exports and falls in imports;
➢ Promoting entrepreneurship;
➢ The modernization of processing of production units.
Import needs will also have to be reframed around products that are strictly essential for processing and the local economy. With this option, the gains are multiple: employment, growth, the living conditions of the populations improve.
References
1. MINPMEESA 2021 statistical yearbook;
2. Agristat 2022;
3. Rural sector development strategy/National Agricultural Investment Plan SDSR/ PNIA;
4. National Development Strategy 2020-2030 (SND30);
5. Cameroon Radio Television (CRTV) news;
6. Google.com;
7. Data from the national statistics institute.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
PROBLEMS &PROSPECTS OF MSMES IN TOMATOES PRODUCTION FOR EXPORT PROMOTION IN NIGERIA
Anthonia Okangbe Abonye
Senior Planning Officer
Federal Ministry of Finance Budget and National Planning Abuja NIGERIA [email protected]
Abstract
Numerous scholars have shown a keen interest in the study of micro, small, and medium- sized businesses. According to statistics, finance is a key factor in fostering the MSME Sector’s expansion. The review seeks to understand the importance of MSMEs in development, the main barriers to MSME growth, and the factors that affect these barriers. MSMEs have revolutionized economic growth, particularly in emerging nations. The survey also identified financial limitations as a significant barrier to MSME expansion. MSMEs struggle to get credit from the formal sector, while banks struggle to provide credit to the industry.
However, the development of MSME’s requires formal financial sources. For the tiny sector, reliance on the informal sector is not a wise decision. Competitiveness, legal framework, credit regulations, and a lack of knowledge about SME borrowers, firm characteristics, and firm size are the key variables that affect lending to MSMEs. Over time, a number of MSME development-focused programs have been developed, and while them have improved the sector overall, they are still largely ineffective. Studies on unregistered and informal MSMEs as well as government-funded organizations that deal with MSME finance are also extremely rare.
Introduction
Micro, small, and medium-sized businesses (MSMEs) are essential to a nation’s economic development. They not only create much-needed blue collar jobs, but they also maintain dynamic competition by preventing corporate concentration and act as a catalyst for market renewal. MSME also acts as a foundation for sustainable growth and innovation. The expansion of agri-food value chains in recent decades has been propelled by the combined investment of numerous micro, small, and medium-sized enterprises (MSMEs) in their upstream and downstream segments, which include the wholesale, logistics, processing, and retail sector.
9
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Together, these MSMEs play a crucial role in regulating the accessibility, price, and security of nutrient-dense commodities like fish and vegetables in Nigeria. At the same time, they are confronted with formidable obstacles that could hinder their operations, expansion, and production. Furthermore, MSMEs in the midstream and downstream parts of value chains have received less attention from research and policy. The effectiveness of these value chains will ultimately help MSMEs supply affordable, secure, and nourishing food. Many researchers have shown a strong interest in the domain of micro, small, and medium-sized businesses. This is due to the sector’s growing significance in terms of providing a means of subsistence for the populace.
Increased demand for work has not been met by the government or organizations in the private sector. Since there are so many unemployed people, entrepreneurship is a relief. But not all of these businesses have been profitable for a variety of reasons.
A popular vegetable all around the world is the tomato. It has a high yield and is economically appealing because it is a crop with a short growing season.Given that they are a nutrient-dense food that is high in dietary fiber, vitamin B and C, iron, and phosphorus, tomatoes provide a healthy, well-balanced diet. Ketchup, puree, powder, and juice are just a few of the goods that may be made from it. Nigeria is the world’s 16th- largest producer of tomatoes, and it has the comparative advantage and potential to be the global leader in tomato production and exports.
Tomato Production Trend in Nigeria although it grows in most of Nigeria, the Savannah agro-ecological zone is the ideal location because there are fewer pests and diseases that harm tomatoes there. Major producing regions are located in the 25oC–34oC temperature range, between latitudes 7.5oN and 13oN.
These regions include certain southern states like Delta, Kwara, and Oyo as well as some northern states like Bauchi, Benue, Borno, Kano, Kaduna, Plateau, and Jigawa. As a warm-season crop, tomatoes are delicate to excessive humidity and rain. Soil types that are sandy loam, well drained, and humus-rich enjoy increases in production. The time for planting is from August through September. The optimum time to plant, nevertheless, is during the dry season where irrigated farming is used. The year 2010 saw the highest yield, while the year 2006 saw the lowest. 2010 saw a total production of 1,860,600 metric tonnes worth $687,610,000. Although they are in short supply during the off- season, the majority of tomatoes produced are for the domestic market.
The annual demand for fresh tomatoes in the country is between 2 and 3 million metric tonnes, leaving a demand gap of roughly 500,000 metric tonnes. To close the deficit between 2009 and 2010, a total of 105,000 metric tonnes of tomato paste worth more than N16 billion was imported.
About 1.8 million metric tonnes of tomatoes were produced in Nigeria in 2010, accounting for roughly 68.4% of West Africa’s output, 10.8% of all production in Africa, and 1.28% of global production. Sadly, Nigeria continues to face problems with a shortage of essential inputs, outdated technology, low yield and productivity, significant post-harvest
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Export Opportunities for SMEs in Developing Countries: Global Experiences
losses, and a lack of infrastructure for processing and marketing. Tomatoes and their byproducts are in extremely high demand, compared to their availability. Nigeria has a sizable market for processed tomato products with a population of more than 223.8 million, an estimated national population growth rate of 6.7% annually, and an average economic growth rate of 4.5% annually over the past five years. The benefit of the West African market’s trade liberalization might be exploited to increase the sale of processed tomato products in this region in addition to the Nigerian market.
To enhance tomato production and processing, it is consequently vital to research the complete value chain. Both development practitioners and researchers have used the value chain approach to capture the interactions of ever-evolving markets and to look at the relationships between various actors participating at every stage of the marketing channel. Analyzing value chains enables evaluation of the connections between productive activities. As a result, the strategy offers a framework for analyzing the nature and factors that influence competitiveness in value chains where small farmers can operate.
Additionally, it offers the fundamental knowledge required for creating and putting into practice suitable development plans and regulations to support their market involvement. In fact, a lot of current development initiatives use the value chain concept as a crucial starting point for involving small farmers, either individually or collectively, in high-value export markets. A value chain approach to agriculture focuses on enhancing the quality of agricultural products, increasing the efficiency of agricultural systems, or developing differentiated agricultural products in order to achieve a more advantageous position in the market (competitive advantage) through the joint efforts of industry partners.
Tomato is now investing in product handling and processing along with a number of State governments and private businesses. To ensure the success of these endeavors, the tomato value chain must be critically examined in order to remove obstacles to the product’s production, processing, marketing, and distribution. Abba and Musa, Adegbola et al. published on related studies on tomato in Nigeria.
MSMEs make a substantial contribution to the economy and employment in Nigeria because they encourage economic growth, establish backward and forward connections, develop human resources, and nurture entrepreneurial abilities in the community.
Approximately 3,294,200 MT of tomatoes were produced (NAERLS & FMARD, 2020). The amount of tomatoes produced in Ebonyi State in 2020 was 55,360 MT, or 1.7% of the total amount produced nationwide. From 2016 to 2020, Ebonyi State had a rise in tomato production. However, it appears that 3 adjustments to the farmed area rather than increased production (yield) led to this increase. The gap between tomato supply and demand has widened, with 2020’s deficit decreasing from 2016’s 59.31% to 2020’s deficit of 21.9%.
Objectives
To identify the key issue impeding MSMEs’ expansion in Nigerian export promotion.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
1. To identify variables in Nigeria that affect these obstacles
2. To recognize the obstacles that the tomato value chain has faced as it has grown and to give recommendations for how to make each link in the chain more competitive in Nigeria.
Challenges Faced by MSME Export Promotion in Nigeria is as follows:
➢ Although MSMEs have made a substantial contribution to the Nigerian economy, obstacles still stand in the way of the sector’s expansion and advancement.
➢ The majority of the state’s regions hardly ever practice tomato production, particularly in commercial numbers. Specific soil, precipitation, and temperature requirements must be met for the tomato plant to flourish. Tomato growing is not sufficiently supported by the state’s agroclimatic conditions. The majority of the state’s regions hardly ever practice tomato production, particularly in commercial numbers.
➢ Specific soil, precipitation, and temperature requirements must be met for the tomato plant to flourish. Tomato growing is not sufficiently supported by the state’s agroclimatic conditions. MSMEs are engines for the growth of the Nigerian economy due to their capacity to fast-track industrialization with constrained resources. Nigeria’s failure to develop manufacturing MSMEs is primarily to blame for its lack of industrialization. MSMEs require significant attention in order to obtain suitable financing MSMEs in Nigeria borrow money at a 25% interest rate.
➢ The growth of the MSME sector would remain a pipe dream if the cost of financing was not reduced. The significant lack of skills is harming MSMEs in Nigeria. MSMEs struggle to innovate and market their goods in the absence of a skilled and motivated workforce. Another significant problem is inadequate infrastructure.
➢ Industrial clusters should be developed where MSMEs can benefit from economies of scale and the benefits of good technology spillover in order to address these restrictions and enhance interlinkage of business activities. Another significant barrier is the variety of rules.
➢ The primary production barriers were erratic rainfall, pest and disease occurrence, price swings, low productivity, poor weed management practices, non-staking of tomato plants, careless fertilizer usage, and a lack of personnel. The production of tomatoes supports a variety of objectives, including the creation of jobs, the security of food and nutrition, local economic development.
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Government Initiatives
➢ There is only one way to raise the production of food grains because there isn’t much room to expand the amount of land that can be used for farming. This is to increase agricultural output or productivity.
➢ The Nigeria-Africa Trade and Investment Promotion Programme, the Presidential Economic Diversification Initiative, the Economic and Export Promotion Incentives, the Zero Reject Initiative, and Reducing Its Mission from Deforestation and Forest Degradation (REDD+) are just a few of the initiatives and programs the government has put in place to address the situation.
➢ To ensure food security and nutrition for the growing population—which is expected to exceed 400 million by 2050—it is vital to increase agricultural production through the adoption of new technology and innovations. The key to accomplishing this objective is having support from all partners for the efforts made by the federal and state government.
➢ The government has taken several initiatives from time to time to ensure an increase in agricultural production. The initiatives taken by the Government are;
• Land Consolidation Scheme;
• Land Ceiling Act (Limit of land holding);
• Green revolution;
• Operation Flood (White Revolution);
• Strengthening agriculture infrastructures like irrigation, fertilizer industry, and cold storage;
• Government schemes like Minimum Support Price (MSP) and fertilizer subsidies;
• Establishment of various institutions like rural banks and co-operative societies;
• Weather bulletins and agricultural programs on radio and television.
• Crop Insurance; and
• Personal insurance cover
Methodology
The range of literature reviewed have been retrieved from journal portals, organizational reports, government reports, University reports, Conference and Seminar publications and other websites.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Year
Projected Population (persons)
Per Capita Tomato Consumption (kg/year)
Estimated Tomato Demand (tons)
Tomato Production in Ebonyi State (tons)
Tomato Supply Deficit (tons)
2016
2,880
383
22 63
25,780
37,588
2017
2,962
173
22 65
32,910
32,258
2018
3,046
2862267
01839
22027
798
2019
132
788 22 68
921 54
090 14
831
2020
3,221
745 22 70
878 55
360 15
518
Sources: Authors’ compilation
Demographic Statistic Bulletin (NBS, 2018) Demand for tomato in Nigeria (PWC, 2018)
Note that this estimate of demand in Ebonyi State assumes that residents of the state consume the average value for all of Nigeria. Agricultural Performance Survey of Annual Wet Season in Nigeria (NAERLS & FMARD, 2017, 2018, 2019, 2020)
Agricultural Development Projects (ADPs), the Food and Agriculture Organization Corporate Statistical Database (FAOSTAT), EUROSTAT, the National Horticultural Research Institute (NIHORT), the Federal Institute of Industrial Research Oshodi (FIIRO), the National Research Institute for Chemical Technology (NARICT), Zaria; the International Institute of Tropical Agriculture (IITA), Raw Materials Research and Development Council
Analyzed data included production figures, agronomy technology, products, and findings from prior studies, traditional and contemporary handling techniques, processing methods, and machinery for turning tomatoes into various products. Nigerian tomato varieties around 7500 different tomato varietals exist worldwide. Because they yield more unique and flavorful harvests and are disease resistant, one of the varieties of tomatoes known as heirloom tomatoes is growing in popularity, especially among home gardeners and organic farmers. Most commercial tomato cultivars yield fruit that is red, but other cultivars, particularly heirlooms, produce fruit that is green, yellow, orange, pink, black, brown, ivory, white, and purple. The superior tomato cultivars that Ahmadu Bello University’s Institute for Agricultural Research (IAR) created for use in Nigeria’s industries in the 1970s are still in use today. New varieties from Taiwan are also available, but due to hybrid seeds’ superior yield, growers increasingly choose to plant them rather than the native elite kinds. The various types of tomatoes sold in Nigeria. The International Institute for Tropical Agriculture (IITA) has, however, only selected a small number of types as recommendations.
Loss of tomatoes According to estimates, over 45% (750,000 metric tonnes) of the tomatoes produced in Nigeria are lost each year as a result of subpar food supply chain management, unstable prices brought on by seasonal production variations, and farmers
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Export Opportunities for SMEs in Developing Countries: Global Experiences
and middlemen’s preference for selling their produce to urban markets over processors because of the latter’s low farm gate price. Tomato wastage primarily happens at the processing, packaging, and distribution stages. This is a result of inadequate distribution systems for fresh tomatoes and subpar storage and transportation technologies. Processing systems should therefore be improved in order to guarantee a consistent supply of tomatoes. Value Chain for Tomatoes the value chain is the network connecting the different steps a product goes through, starting with its manufacture and ending with its handling, processing, and delivery to the consumer. In the value chain system, the FAO claims that farmers are linked to consumers’ needs, working closely with suppliers and processors to produce specific goods to meet consumers’ demand. Similarly, through flows of information and products, consumers are linked to the needs of farmers. Under this approach and through continuous innovation, the returns to farmers can be increased and livelihoods enhanced.
Findings
This literature review discusses the government’s strategy in increasing agricultural yields so as to improve farmer welfare. The government spending in the agriculture sector and the expansion of the economy in Nigeria were shown to be significantly correlated. Additionally, it was found that the industry is still plagued with issues including weak infrastructure and insufficient financing. The report therefore advises that in order to set up the nation’s economic growth, it is crucial that the agricultural sector be developed through adequate government spending. It highlights the need to educate farmers, enhance and provide infrastructure, give the sector priority when allocating money, enthrone proper and competent extension services, among other steps spelled out by the government.
The government has pursued marketing of agricultural products in a variety of ways, including controlling product quality, establishing marketing networks, and creating technology-based agribusiness marketing systems to facilitate the selling of agricultural products.
Suggestions
E-commerce is frequently regarded as a means of lowering the expenses associated with exporters’ entry into and viability in global marketplaces. MSMEs in Nigeria will gain from the increased visibility offered by e-commerce platforms. Online sales are encouraged by improved infrastructure, competitive pricing, and lower marketing and outreach expenses for products on a digital platform.
The Nigerian government has implemented a number of initiatives to increase MSMEs’ exports. The Nigeria Programme to Promote the Ease of Doing Business, through Support Services, Agricultural Extension, Technology Development and Transfer, is among those initiatives. The government’s agricultural extension and technology transfer policies are primarily intended to teach rural residents how to improve their level of life on their own with the least amount of help. In order to improve farmers’ welfare, government will be
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Export Opportunities for SMEs in Developing Countries: Global Experiences
concerned with the spread of practical and valuable information about agriculture, the practical application of such knowledge, and the mobilization of farmers’ resources.
The government is dedicated to resolving these issues in an effort to support small-scale farmers, despite the fact that the country’s agricultural extension system is currently beset by administrative, staffing, and financial issues. The following public policy measures will support the state government in its effort to mobilize the farmers:
➢ ➢
➢ ➢
➢
Infrastructure and training facilities that are appropriate for effective extension service;
The creation of a productive channel of contact between researchers, extension personnel, and farmers;
The efficient use of extension services as facilitators of technology transfer;
The creation of demonstration farms and centers for rural processing for forestry, livestock, fisheries, and crops; and
Encouragement of private sector investment in the distribution of agricultural information.
The goal of agricultural credit policy is to provide the agricultural industry with sufficient investment financing at the appropriate times and at rates that will increase the allure of agricultural returns. We’ll use a two-ranged policy method.In the first, fiscal and monetary policies that have an impact on the agriculture sector must be structurally adjusted. The second entails alterations to the way that existing institutions that offer agricultural loans now operate. a) Changes to fiscal and monetary policies will include increasing the sectorial distribution of loans and advances to agriculture from 15% to about 25%, adjusting grace periods, and implementing a moratorium on agricultural loans in accordance with the gestation periods of the projects. Low interest rates, which make it possible for the Nigerian Agricultural and Cooperative Bank (NACB) to obtain funds from sources other than the Central Bank, government regulation requiring banks to provide loans of up to 50% of the deposits generated in areas under the rural banking scheme to borrowers in the rural areas, and a government monitoring system to make sure that credit guidelines are met.
Changes in the way lending institutions operate will lead to an increase in the number of branches and share capital of the Nigerian Agricultural and Cooperative Banks in order to reach rural areas and mobilize rural savings, the demand for tangible securities like the Certificate of Occupancy and survey plan, and the replacement of Customary Occupancy Rights as collaterals for agricultural loan procurement. State governments hold a minority stake in (State Agricultural and Cooperative Banks), with the Nigerian Agricultural and Cooperative Bank (NACB), cooperatives, and farmers’ organizations holding the bulk of equity shares. These banks will run a lending operation that will provide loans to farmers from the NACB and other banks.
A Long-Term Irrigation Fund and a Micro Irrigation Fund were established by the government as well as other measures to promote investment in the agricultural
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Export Opportunities for SMEs in Developing Countries: Global Experiences
industry. Setting up qualifying infrastructure projects benefits organizations including farmers, start-ups, governmental agencies, and municipal bodies under the Agriculture Infrastructure Fund. It won’t be long before continuous government investments and initiatives change the way the farm sector looks.
Conclusion
The unregistered and informal sector, which is relatively considerably larger in prevalence but also unaccounted for, was the research gap that was found. These sectors are mostly understudied. On the government’s contribution to the growth of MSME, more research may be done.
The study on the growth of the tomato value chain in Nigeria was conducted to fill knowledge gaps and to advance the tomato value chain. The study found that although while tomatoes are grown in great amounts in the northern region of Nigeria, a lot of it is wasted since it is perishable and there aren’t any processing businesses to turn the raw tomatoes into paste and other products.
In addition, only a small number of Nigerian tomato types are suited for industrial processing. Through an enhanced process technology and the utilization of the value chain approach, it may be possible to increase tomato output while lowering the losses brought on by the perishability of the harvested product. To support the growth of Nigeria’s tomato production and processing business, a research was conducted to evaluate the tomato value chain.
References
1. FAO. (2020). Fruit and vegetables – your dietary essentials. The International Year of Fruits and Vegetable, 2021, background paper. In Fruit and Vegetables – Your Dietary Essentials. https://doi.org/10.4060/cb2395en
2. FAOSTAT, (2022) https://www.fao.org/faostat/en/#data/QCL. Mason-D’Croz, D., Bogard, J.R., Sulser, T.B., Cenacchi, N., Dunston, S.,Herrero, M. & Wiebe, K. (2019). Gaps between fruit and vegetable production, demand, and recommended consumption at global and national levels: An integrated modelling study. The Lancet Planetary Health 3(7): e318–e329. www.sciencedirect.com/science/ article/pii/S2542519619300956.
3. NAERLS & FMARD. (2017). Agricultural Performance Survey of 2017 Wet Season in Nigeria: National Report. National Agricultural Extension and Research Liaison Services.
4. NAERLS & FMARD. (2018). Agricultural Performance Survey of 2018 Wet Season in Nigeria: National Report. National Agricultural Extension and Research Liaison Services.
5. NAERLS & FMARD. (2019). Agricultural Performance Survey of 2019 Wet Season in Nigeria: National Report. National Agricultural Extension and Research Liaison Services.
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6. NAERLS & FMARD. (2020). 2020 Wet Season Agricultural Performance in Nigeria. NBS. (2018). 2017 Demographic Statistics Bulletin. National Bureau of Statistics. Onyeneke, R. U., Amadi, M. U., & Njoku, C. L. (2022). Climate Change Adaptation Strategies by Rice Processors in Ebonyi State, Nigeria. Journal of the Institute of Landscape Ecology, Slovak Academy of Sciences 41(3), 283–290. https://doi.org/10.2478/eko-2022-0029
7. Onyeneke, R. U., Amadi, M. U., Njoku, C. L., & Osuji, and E. E. (2021). Climate Change Perception and Uptake of Climate-Smart Agriculture in Rice Production in Ebonyi State, Nigeria. Atmosphere (Vol. 12, Issue 11). https://doi.org/10.3390/ atmos12111503
8. Osuji, E. E., Onyemauwa, C. S., Obasi, I. O., Obike, K. C., Ebe, F. E., Tim-Ashama, A. C., Ibekwe, C. C., Obi, J. N., Inyang, P., Azuamairo, G. C., Chinaka, I. C., Ankrumah, E., Praise, C. N., & Ifejimalu, A. C. T. (2022). Food Sustainability and Security, Aftermath of Vegetable Production in Ebonyi State, Nigeria. Journal of Agriculture and Crops, 8(3), 122–130. https://doi.org/10.32861/jac.83.122.130
9. Pricewater Cooper. 2020. X-raying the Nigerian tomato industry Focus on reducing tomato wastage. https://www.pwc.com/ng/en/assets/pdf/nigeria- tomatoindustry.pdf.
10. Stephen KorutaroNkundabanyanga, Denis Kasozi& Irene Nalukenge (2014). Lending terms, financial literacy and formal credit accessibility International Journal of Social Economics.Vol. 41 (5). PP. 342-361 WHO and FAO. (2003). Diet, nutrition, and the prevention of chronic diseases. Report of a joint WHO/ FAO expert consultation
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10
ENVIRONMENTAL ISSUES OF ERITREA’S TRADE AND INDUSTRY SECTOR
Mr. Michael Yared Kidane
Unit Head of Foreign Trade Ministry of Trade and Industry [email protected]
Abstract
Mr. Osman Seid Hamid
Assistant Unit Head of Foreign Trade Ministry of Trade and Industry [email protected]
MSME is one of the most important activity in every nation, because it increases the capacity utilization of labor force. Eritrea is one of the developing country in the horn of east Africa, it is a strategic country, bordered by Ethiopia in the south, Sudan in the west and Djibouti in the southeast. The northeastern and eastern part of Eritrea have an extensive coastline along the Red sea. The nation has a total area of approximately 117600km2 (45406sqm) with two ports Massawa and Assab, and includes the Dahlak Archipelago and several of the Hanish islands.
The paper MSME provides an overriding on multi-lateral agreements with different nations in every aspects of industrial and trade activities. It also solve the unemployment problems to all private sections equally that enhancing economic growth and development of the country.
Introduction
In Eritrea, the development of the industrial and trade sector is expected to bring economic growth and employment. Hence, immediately after independence, concerted efforts were made to rehabilitate the manufacturing enterprises inherited from the colonial regime. Accordingly, the factories have resumed their normal operation, and many new public and private manufacturing plants have been established. However, the growth momentum of the economy, expansion of manufacturing activities of industrial output and employment were significantly affected by the border conflict with Ethiopia, which started in 1998, and the subsequent unfair and unjust sanctions of the United Nations.
An ever-increasing industrial and trading activity is expected to create environmental pollution and ecosystem deterioration. Therefore, the Ministry of Trade and Industry (MTI) strives to protect the environment and the health and safety of employees. Accordingly the ministry requires in the business project proposal the inclusion of sound environmental procedures and Occupational Safety and Health (OSH) of employees. These procedures are forwarded to department of environment and Ministry of Labor and Social wafer for assessment and approval respectively. In this regard the issuance of licenses operates within the framework and guidance of environmental screening
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Export Opportunities for SMEs in Developing Countries: Global Experiences
and evaluation procedures. Zoning of industries closely follows the procedures of local government.
State of the Manufacturing Sector in Eritrea
According to a study conducted by the MTI in 2018, The number of small and medium establishments (SME) declined from 265 in 2008 to 193 in 2018. Similarly employment were in the range of 12,466 and 8,588, the highest being that of the year 2010 and lowest was that of the year 2018.
Table 1 Number of medium and large establishment and employees
Sr. No
Industrial Sub-Sector
No of Establishment
No of Employees
1.
Food and Beverage
71
2,511
2.
Textile, Leather and Garment
29
2,005
3.
Paper, Printing and Publication
12
518
4.
Chemicals, Paints and Pharmaceuticals
16
627
5.
Plastic and Rubbers
9
183
6.
Construction Materials
19
1,039
7.
Metals
15
259
8.
Furniture
22
1,446
Total
193
8,588
Source: Industrial development road map
The medium establishments are those that employ 10-25 persons . The regional distribution of these manufacturing enterprises is highly skewed. According the study conducted by MTI in 2020, 82.4% of the SME are located in Zoba Maekel, 8.3% are in Zoba Debub and 5.3% in Zoba Semenawi Keih Bahri. The remaining are in Zoba Anseba and Zoba Gash-Barka.
No. of
No. of Establishments, Semenawi Keih Bahri, 10, 5%
No. of Establishments, Gash-Barka, 4, 2%
Geographical Distribution of MLE
No. of Establishments, Maekel, 159, 83%
Gash-Barka
Establishments,
No. of Anseba, 4, 2%
Establishments, Debub, 16, 8%
Maekel
Debub
Semenawi Keih Bahri
Anseba
Figure 1: Geographical distribution of MLE
Figure 1: Geographical distribution of MLE
Source: Industrial development road map of Eritrea (2020)
Source: Industrial development road map of Eritrea (2020)
All Small and Micro manufacturing establishments (SMEs) (establishments with 1 to 2
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employees are considered as micro while those with 3 to 9 employees are considered as small)

Export Opportunities for SMEs in Developing Countries: Global Experiences
All Small and Micro manufacturing establishments (SMEs) (establishments with 1 to 2 employees are considered as micro while those with 3 to 9 employees are considered as small) are privately owned and operated by family members. All SMMEs are engaged in the production of food and beverages, footwear and other leather products, sweaters, furniture, fabricated metal, and construction materials. Approximately 43.3% of SMME businesses are located in Zoba Maekel, 21.1% in Zoba Debub, and the remaining 35.6% in Anseba, Semenawi Keih Bahri, Debubawi Keih Bahri and Gash Barka.
During 1998-2006 capacity utilization in the manufacturing sector has been steadily declining and currently becomes very low. The overall weighted average capacity utilization of the manufacturing sector declined to 39 percent, in 2006 and 2007-2008 it reached as low as 20%. It has further deteriorated since then and were estimated 19.2, 11.4, 9.3 and 8.5 for the years 2013, 2015, 2017 and 2018 respectively.
To increase capacity utilization, at first the war should be come to an end. Meanwhile the factories should be rehabilitated, necessary chemicals and import export activities should be put in place.
Key Environmental Issues of Eritrea’s Trade and Industry Sector
Industrial establishments pollute the environment (air, land and water bodies) of a country. The pollutant differs from industry to industry, according to the raw materials used and the manufacturing processes. It may contain inorganic fractions, organic fractions, biodegradable fractions, non-biodegradable substances.
To identify the key environmental issues, the MTI has formed a task force and a technical working group from its different working units namely food, beverage and related products unit, manufacture of leather, textile and related product unit, manufacture of wood, metal and non-metallic materials based products unit and manufacture of chemical, rubber, plastic and paper based product unit.
The main Objectives
• Reduction of noise and air pollution
• Reduce, recycle and re-use of industrial solid and liquid wastes
• Strengthen the management system of industrial chemicals
Considering the identified priorities, an assessment was conducted through documentary review, factory visits, key informants interview and focused group discussion. Since environment is more affected by industrial activities, the assessment has given more focus to the industrial sector. The study predominantly covers medium and large establishments located in Zoba Maekel. Moreover, major polluting establishments (for example cement factory) located in other Zobas were also considered in this assessment. A total of 25 representative factories were visited. While the micro and small scale establishment is not assessed, because the volume of their wastes is considered to be low and most of the wastes are reusable. Salt works and Medeber are administered under Ministry Marin resources and Municipality Maekel Region respectively, hence they were not considered in this report.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
There were three projects proposed for implementation with NEMP-E 1995 for the industrial sector.
• Initiation of first phase of non-waste and low-waste technology (NLWT) program and the establishment of a data base on NLWT
• Building Eritrea’s capacity to manage chemicals: Legislation and Management procedures for chemical use in Eritrea.
• Recycling of waste water from the Textile Industry
However the proposed projects were not implemented. Even now most of the environmental problems are not solved. Hence the 1995 proposed project is still valid.
Industrial Noise Pollution
Noise pollution is unwanted sound judged to be unpleasant, loud or disruptive to hearing. It is created in the process of production while operating machines and ancillary equipment. In most cases the nature of the industrial process and technologies determines the level of noise pollution. The noise pollution of most industrial establishments is produced due to old, outmoded and depreciated machines. In the 1995 environmental management plan for some factories, the level of noise were measured. while the current level of noise pollution could not be measured. During the industrial visit, considerable noise was recognized in the spinning and weaving section of textile industries, flour mills, cement factor, shoe factory, carpentry and metal workshops. In addition, the stone crashers in the building materials manufacturing sector generates noise that goes beyond the factory premises.
Significance of the Noise Pollution
It is difficult to conduct a comparative analysis as we do not have Eritrean noise standards and measuring instrument. However, according the interview made with factory workers during the industrial visit the level of noise of some establishments were found to be unpleasant, loud or disruptive to hearing, moreover most of the working machines were not rehabilitated since 1995. Hence, the data reflected in the 1995 NEMP-E is still valid, i.e. it is high compared with developed countries (85 to 90 db).
Industrial Air Pollution
Air pollution occurs when excessive quantities of harmful substances are introduced into Earth’s atmosphere. The type of air pollution include gases (such as ammonia, carbon monoxide, carbon dioxide, sulfur dioxide, nitrous oxides, methane and chlorofluorocarbons and different gases from the solvents used) and particulates matter (mix of solids and liquids, carbon, complex organic chemicals, sulphates, nitrates, mineral dusts and water suspended in the air). In Eritrea, most industrial processes in leather, textile, food and beverages, building materials, printing press and chemical industries release gases that create indoor air pollution. The issue of bad odour which is released from the waste water in tanneries can be minimized by establishing full-fledged effluent treatment plants as the developed countries practicing. In our case they are trying to protect using PPEs.
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Significance of the emission of ozone depleting substances and GHG
There is also outdoor air pollution (CO2) generation during cement production and burning of fossil fuel for energy generation in different industries.. However it is not significant as we compared with industrial countries.
One of the main emissions of Green House Gases (GHG) in Eritrea is the CO2 emitted in the process of cement production and burning of fossil fuels for the energy and electricity generation in different factories. The actual quantity of this CO2 releases from different sources is calculated as shown in the table 3 below.
Table 2: Average (2014 to 2018) Annual CO2 Emission
Sr. No.
Source of CO2
Unit/yea
Consumption
CO2 emitted ton/year
CO2 emitted from process
Grand Total
1.
Diesel
liter
3,260,800
8,530
0
2.
Fuel oil
liter
5,684,000
16,880
0
3.
Coal
ton
5,175
13,529
0
4.
Electricity
KWH
28,926,730
18,513.11
0
5.
Cement
ton
31,200
0
17609
Total
43,923.11
17,609
61,532.11
Source: compiled from MTI data, 2022
Significance of the emission of ozone depleting substances
Ozone depleting substances are substances that have a potential of depleting the ozone layer. The Vienna Convention and the Montreal Protocol are the Conventions concerned with the Ozone Depleting Substances (Chemicals) and Eritrea became a party to the convention in 2005. Eritrea does not produce any of these substance, they are all imported from abroad. Although the use of ODS in Eritrea is not much when compared with other neighboring countries that have intensive agricultural practices and industries, it consumes a significant amount of ODS specifically HCFCs, on the refrigeration sector. Based upon the ODS survey made, the ODS consumption in 2010 was 20.31 tons. Awareness raising, custom officers and Refrigeration and Air conditioning technicians’ training and other useful measures have been undertaking to reduce the ODS consumption and enhance the application of the ODS alternatives.
Eritrea also gazette the “Regulations for the Issuance of Permits for the Importation or Exportation of Ozone Depleting Substances (ODSs) and Ozone Depleting Substances Based Equipment or Products”, in 2010. The Regulations controls importation and exportation of ozone depleting substances (ODS) as well as products containing ODS. The regulations also include measures to control the consumption of HCFCs through a licensing and quota system. The Regulations further puts in place a mechanism to
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verify facilities handling HCFCs to ensure that they have adequate human capacity and equipment to manage HCFCs in an environmentally sound manner. In order to control the importation and consumption of HCFCs, licensing and quota system was established and operationalized since 2013. In line with the Montreal Protocol phase out schedule, Eritrea has reduced its HCFC consumption by more than 35% by 2020.
Industrial Solid Wastes
Industrial solid waste refers to any type of solid waste from industrial activities that can be described as materials that are not prime products (that is, products produced for the market) for which the generator has no further use in terms of his/her own purposes of production and transformation, which he/she wants to dispose. The waste may differ from industry to industry according to the raw materials used and the manufacturing processes; they may have inorganic fractions, organic fractions, biodegradable fractions, non-biodegradable substances, etc. It includes hides, skins and leather trimmings, hair, wood, cardboard, paper, metal scraps, plastic, debris and sludge of different industries. The quantitative data of solid waste in most of the industries is not well documented. For some industries the amount of the solid wastes are shown in table 3 below.
In Eritrea, except Asmara brewery and Red Sea Bottlers share company, most of industries do not segregate, reuse, and recycle the solid wastes, they are disposed directly into the municipality damping site. Hence the country should share the good practice of developed countries on reducing, recycling and reusing of solid wastes to reduce the amount of solid wastes disposed.
Leather and Textile Solid wastes
Currently there are five tanneries, namely: Keih Bahri, Asmara Pickling, Petros & Sons, T-Baatai & Sons, and Semhar Tanneries. They release hazardous and non hazardous solid wastes. Non hazardous solid wastes include fleshs, trimmings of untanned hides and skins with and without hair, trimmings of limed hides and skins. The hazardous wastes are the result of the chemical processing activities and possess toxic metals mainly chromium. The common hazardous wastes are chrome-tanned shaving and split trimmings, shacked salt, and sludge.
Currently developed countries are producing chrome free leather and remove the burden of the chrome pollution. In addition they are minimizing the solid wastes through applying science of reduce, reuse and recycle. Hence our industries should share these best practices to minimize the solid wastes to the minimum level.
Building Materials Solid waste
There is no solid pollution that needs special attention in the building materials subsector. The solid wastes that could be produced are trims of marble and Sludge from manufacturing of cement block and marble manufacturing sector, metal scraps and wood chips and saw dust. These can be re-using for different purposes as described in the table 3.
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2.3.4 Printing Presses and Chemicals Solid Wastes
Dregs of paper are the major waste in the printing presses and paper products industries. This dreg is sold for weddings and other ceremonial activities as a decorating material. The industries under the chemical subsector are soaps and detergents, cosmetics, candles, paints, and foam mattresses and pillows manufacturing plants. In most of these plants the solid wastes are either reused again or reprocessed in to related products.
Table: 3 Summary solid wastes
Data type
Unit
Updated
Potential re-use
Remark
Solid Waste
Qty/Yr
Chips of wood and saw dust
Used for fire
Keih Bahri Tannery- Non Hazardous solid waste
4,914
It can be used
as animal feed, fertilizer, in making office glues, cosmetics,
Currently dispose to municipality land fill
Keih Bahri Tannery- Hazardous solid waste
2,948
useful in the making of carpets , leather boards
Currently dispose to municipality land fill
Asmara Pickling Tannery- Non Hazardous solid waste
1,755
It can be used
as animal feed, fertilizer, in making office glues, cosmetics,
Currently dispose to municipality land fill
Asmara Pickling Tannery- Hazardous solid waste
1,053
useful in the making of carpets , leather boards
Currently dispose to municipality land fill
T-Baatai & sons Tannery- Non Hazardous solid
264.46
It can be used
as animal feed, fertilizer, in making office glues, cosmetics,
Currently dispose to municipality land fill
T-Baatai & sons Tannery- Hazardous solid waste
158.67
useful in the making of carpets , leather boards
Currently dispose to municipality land fill
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Petros Araya Tannery- Non Hazardous solid waste
702
It can be used
as animal feed, fertilizer, in making office glues, cosmetics,
Currently dispose to municipality land fill
Petros Araya Tannery- Hazardous solid waste
421.2
useful in the making of carpets , leather boards
Currently dispose to municipality land fill
Eritrea Textile tons per day
2.35
used for making mattress & pillows, sanitary towel, medical cotton, and as raw material for low quality yarn.
Natsenet Textile tons per day
2.35
Discharge to the municipality drainage system
Total solid waste
12221.03
NB -The estimated tannery waste is calculated from its actual average production capacity using study supported percentages.( A Survey of Leather Waste Generation and Disposal Mode in six selected tanneries in Kenya available online: 3 February 2020. )
Industrial Liquid Wastes
Liquid waste is any waste product that leaves the production facility in liquid form. Industrial liquid waste is one of the main environmental concerns, because it is discharged in a huge amount and with its potential harmful substances. As compared to other industrial establishments, the food, beverage, leather and textile factories are among the industries that demand high amount of water in their production process.
S. No
Liquid Waste
Unit
Updated
Potential reuse
Remark
1.
Waste water Natural Edible Oil Factory
NA
Company not operational since 2000
2.
Keih Bahri Tannery
M3 /day
17.92
Discharge to the municipality drainage system
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Export Opportunities for SMEs in Developing Countries: Global Experiences
3.
Asmara Pickling Tannery-
M3 /day
20. 25
Discharge to the municipality drainage system
4.
T-Baatai & sons Tannery-
M3 /day
1.5
Discharge to the municipality drainage system
5.
Petros Araya Tannery-
M3 /day
1.525
Discharge to the municipality drainage system
6.
Semhar Tannery
M3 /day
1.5
Discharge to the municipality drainage system
7.
Eritrea Textile
M3 /day
25
Discharge to the municipality drainage system
8.
Baroco Textile
M3 /day
25
Discharge to the municipality drainage system
Most industrial establishments have no waste water treatment plants, and dispose their untreated wastewater into the municipality sewerage. The harmful substances generated by these establishments can leach into the soil and water bodies affecting plants, wildlife and humans. Depending on the input of the raw materials, it is expected to have alkalis, acids, and heavy metals, organic and inorganic chemicals. This liquid wastes can be manage by relocating the polluting industrial establishments to the identified industrial area with full fledged waste water treatment plant as the industrial countries practicing.
Table 4: Characteristics of Combined Wastewaters disposed from Tanneries
Characteristics
Results
pH
7 - 10
Suspended Solids
6000-9000 mg/l
BOD
2250 – 2500 mg/l
COD
6000 – 9000 mg/l
TDS
>18000 mg/l
Source: Tannery Industry Waste Water Draft Report (MTI, 2018)
Chemical Management Systems
The main types of chemicals imported are: Petroleum products, various fertilizers, Pesticides (insecticides, fungicides, herbicides etc.), industrial raw materials for the manufacturing/processing industries (e.g. plastics, solvents, acids, pigments and commercial chemicals), pharmaceuticals and chemicals for mineral ore processing.
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The production of chemicals in Eritrea is negligible. Most chemicals used in Eritrea are obtained through imports. Customs Department of the Ministry of Finance (MoF) and other government agencies oversee issues related to imports and exports of goods. However, for certain categories of chemicals, specific authorities have to approve their imports depending on their nature and impact to health and environment. Agrochemicals and veterinary drugs approved by Department of Regulatory Service of the Ministry of Agriculture (MoA), importation of Polyethylene sheets and plastic bags less than 100 micrometer, refrigerants and exportation of hazardous wastes issued by DoE of the MoLWE, industrial chemicals approved by Department of Industrial Development of the Ministry of Trade and Industry (MoTI) while the Department of Regulatory Service of the Ministry of Health (MoH) issue clearance on Pharmaceuticals importation. Moreover, mining chemicals have to be approved by Department of Mines of the Ministry of Energy and Mines (MoEM).
Unless managed and controlled properly, chemicals have an adverse impact on lives and the environment during importation, transportation, storing/handling and disposing processes of the obsolete and expired chemicals. Eritrea should adopt practicable acts from the neighboring countries like Ethiopia for industrial chemicals registration and administration proclamation to establish a national system for registration and administration of industrial chemicals to prevent and control the adverse effects arising from the mismanagement of chemicals.
Major risks associated with the use and management of industrial chemicals
Most of the problems that are associated with the use and management of industrial chemicals in Eritrea are indicated in the table below.
Table 5: problems of unsound management of industrial chemical
Unsound practice/ management
Pollutants
Effect
Uncontrolled release of dusts, toxic gases and hazardous chemicals
Dust particles, heavy metals and volatile poly Aromatic hydrocarbons.
Air pollution
Uncontrolled, spill of chemicals and dumping of expiry and obsolete industrial chemicals
Dyes, heavy metals, Nitrates, metals and inorganic salts.
Pollution of Inland water ways
Disposal of expiry and obsolete industrial chemicals
Dyes, heavy metals, nitrates, metallic and inorganic salts.
Soil contamination
Lack of guidance in appropriate use and safety equipment
Acid, Alkalis, ammonia, chlorine, acetylene
Chemical accidents
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Export Opportunities for SMEs in Developing Countries: Global Experiences
Note: Chemical containers supposed to be properly disposed of are used for various domestic and other purposes consequently affecting the public health.
Chemical management or stringent controls in the lifecycle of industrial chemicals presupposes the promulgation of legislation. The dissemination and subsequent enforcement of these legal instruments by bodies responsible for their implementation is also indispensable.
In Eritrea, Harmonized legal instruments pertaining to industrial chemical management are non-existent. Record keeping of import and use is very poor. Although in custom and MTI have some data/information related to chemicals, they are not systematically organized and cannot be easily accessed.
The accomplishments towards strengthening chemicals management systems are:
Eritrea has undertaken a number of initiatives such as: Primary draft Legislation on Pesticide Management (1998), the draft Environmental Law (2002) contains several provisions relevant to chemicals management and hazardous wastes, Regulation on banning of Poly-plastics less than 100micrometer (2004), a regulation on the importation, handling, use, storage and disposal of pesticides (2006), Basic criteria for a pest control operator’s license in 2007, the preparation of National Implementation Plan (NIP) on Persistent Organic Pollutants (POPs) in 2012 and the other, of course, is the development of this National Chemical Profile (NCP).
As a commitment to ensure safe and clean environment, Eritrea (with international and donor support) has undertaken projects including national pesticide inventory to safeguard and ultimately dispose of the obsolete pesticide, Inventory of Chlorofluorocarbons (CFCs) to phase out CFC and recycle refrigerants, prepared the National Implementation Plan for the Stockholm Convention these are without mentions the efforts undertaken in area of climate change, biodiversity and combating land degradation and the associated targeted training programs on hazardous waste management. In addition the MTI undertook the following activities.
The Department of Trade: deals with the import and export of goods and issues relevant trade permits. To this end
• It has developed a licensing system for importers.
• For detailed analysis importers will not be allowed permit unless they bring supporting letter from the related ministry.
The Department of Industrial development strictly insists investors to incorporate and to follow sound management of the lifecycle of the industrial chemicals and chemical wastes in their feasibility study during the issuance of license.
• The following legislative documents promulgated and enforced:
• Proclamation No 124/2002: Business Information Register Proclamation
• Any person desiring to import commercial goods shall first register and get license
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