Private sector unveils small business survival guide

Private sector lobby group, Kenya Private Sector Alliance (KEPSA), Tuesday launched the Micro, Small and Medium Enterprises (MSME) Policy Index to provide policymakers and market players with a tool to monitor and evaluate progress achieved in implementing policies meant to support MSMEs.

The tool, developed in 2018, is part of the KEPSA SME agenda and builds on the Kenya Rising Star and Scale-Up programme (KRISP) for SME and Entrepreneurship Development in Kenya that was developed and presented to President Uhuru Kenyatta for endorsement during the 6th Presidential Roundtable (PRT) in May 2016and whose main objective was to foster development of a resilient Kenyan economy by supporting SME development, nurturing entrepreneurial culture and expanding opportunities for wealth and employment creation.

KEPSA has previously been involved in efforts to organize the SME sector through formation of Micro and Small Enterprises Federation, and enhancing the regulatory environment through enactment of the MSE Act 2012 – which also set the framework for establishment of the MSE Authority and MSE Fund.

The MSME policy Index is the first of its kind in Africa and borrows from the best practices in ASEAN countries. It was motivated by KEPSA desire to ensure inclusion of SME policy issues in the business environment reform agenda and that the year on year improvement in Kenya’s ranking on the World Bank’s Ease of Doing Business is being felt by businesses of all sizes across the country.

The Index is based on eight-policy dimensions and outlines recommendations that are highly necessary for MSME development across the policy space, legislation, regulations, programs, and MSME support systems and is intended to support the government in setting targets for MSME policy development by identifying strategic priorities for improving the business environment to stimulate the growth of MSMEs and the entire economy.

The index is drawn from a total of 75 indicators that are relied upon in measuring the extent to which each policy dimension is either supportive or not supportive of the MSMEs. The eight policy dimensions key among them enabling governance and business regulatory environment, reliable infrastructure and access to inputs, access to MSMEs financing among others.

KEPSA Chief Executive Officer Ms. Carole Kariuki said the tool had been used for the first time in Kenya and Africa as a whole, to assess, gauge and rank the MSME policy environment and to determine how the MSME policies influence economic growth and development.

“The tool will help in identifying local and international best practices in facilitating MSMEs growth,” Ms. Kariuki said.

Chris Kiptoo, the Principal Secretary, State Department of Trade, Ministry of Industry, Trade and Cooperatives applauded KEPSA for launching the tool. “The Index must be applauded as a purposeful tool for interrogating and monitoring progress in policy implementation,” he said.