SME sector can help resolve unemployment problem: Experts
Amid the growing unemployment problem in the country, experts have said the Small and Medium Enterprise (SME) sector can be an effective tool to resolve the problem if it gets necessary support to flourish.
They said there is no alternative now to putting emphasis on the SME sector and creating skilled manpower through technology-based education.
A large number of educated youths are now unemployed in the country. The current rate of unemployment will rise further in the future and the government should think for more employment generation for youths, they said.
According to the Bangladesh Bureau of Statistics (BBS), country’s unemployment rate increased to 4.37 percent in December 2017 from 4.35 percent in 2016.
Every year, about 2 million young people join the country's workforce. Half of them find jobs at home or abroad. So, it has become a challenge to create more jobs so that the rest can be employed.
Dr Mohammad Mahfuz Kabir, Research Director of Bangladesh Institute of International and Strategic Studies (BIISS), said the country’s SME sector would undoubtedly play an important role in reducing unemployment and attaining double digit GDP growth in the future.
“We’re moving towards technology-based industry. Thousands of factory workers will lose their jobs for the 4th industrial revolution. So, it’s time to think about the SME sector. Or else, where will the unemployed people go? In many developed countries of the world, the SME sector is playing a significant role in the economy. So, we need to carry out extensive research and take necessary plans in this regard,” he said.
Bangladesh Bank (BB) Governor Fazle Kabir said the SME sector can contribute to the country’s journey towards achieving double-digit GDP growth.
Putting emphasis on creating skilled entrepreneurs, he said, “We’re providing policy support to encourage small and medium entrepreneurs. So, various training programmes should be arranged to create skilled entrepreneurs,” he said.
“SMEs will generate jobs and boost the economic growth. Micro industry is developing here. So, there’s a good future for SME entrepreneurs. Banks have been instructed to provide at least 20 percent of the loans to SME industries. Entrepreneurs can get loans with special facilities from Entrepreneurship Support Fund,” the central bank governor said.
Md Mostaqaue Hassan, Chairman of Bangladesh Small and Cottage Industries Corporation (BSCIC), told UNB that they have taken mega initiatives to promote the SME sector.
“Now, our main focus is on the areas having business potential where we can build SME industrial parks. We’ve already visited places by the Padma River, especially Shariatpur-Madaripur and Munshiganj areas, for 500-1000 acres of land to set up two BSCIC industrial parks,” he added.
The BSCIC chairman also said they need more support from the government to develop the sector as there are many challenges and barriers to implementing projects. “We’ll build industrial parks on around 20,000 acres of land in the next 10 years and create one crore employments. Educated youths will get priority. A radical change will take place in economy in future,” he also said.
Industries Minister Nurul Majid Mahmud Humayun told UNB that his ministry is organising many fairs to promote the sector so that foreign investors could be aware that there is a good atmosphere to invest in Bangladesh.
“We’re inspiring entrepreneurs at the district level. Now, we’ll focus on the districts where agro-based products are produced. We’ll train up the entrepreneurs,” he said.
The minister further said the ministry has taken some initiatives to build sustainable and environment-friendly industries. “We hope the SME sector will play a big role in the country’s economy in future.”
According to a report of the Planning Division tiled “Study on Future Direction of SME in Bangladesh”, SMEs now occupy an important position in the national economy. They account for about 45 percent of manufacturing value addition, about 80 percent of industrial employment, about 90 percent of total industrial units and about 25 percent of the labour force. Their total contribution to export earnings varies from 75 percent to 80 percent.
The industrial sector makes up 31 percent of the country's gross domestic product (GDP), most of which is coming from SMEs.
The total number of SMEs in Bangladesh is estimated to be 7,900,000. Of them, 93.6 percent are small and 6.4 percent are medium. The 2003 Private Sector Survey estimated that there are about 6 million micro, small and medium enterprises, with fewer than 100 employees each. About 60-65 percent of all SMEs are located outside the metropolitan areas of Dhaka and Chattogram.
The country's SME sector has created 15 lakh jobs between 2009 and June 2014.
Source: https://unb.com.bd