Global economies are built by Small and Medium Enterprises (SMEs).  They provide the entrepreneurial vibrancy and vitality which drives economic activity across different industries.

The SMEs are the undisputed foundation of economic diversification and expansion, contributing immensely towards a positive socio-economic impact within the country.  Their importance in Kenya is reflected in the Economic Survey 2014 which showed that 80 per cent of the 800,000 jobs created were in the informal sector that is dominated by SMEs.

The importance of SMEs in our daily lives and the economic wheel of the country is immense.  The government needs to provide an environment that allows SMEs to thrive.
In fact, the president’s directive for public bodies to purchase from the youth, women and people with disabilities is a step in the right direction.  The tender specifications should also take into account and give priority to local production with local raw materials and labour.
Malaysia’s rise to the status of a newly industrialized country is credited in part to its success in SMEs that form 90 per cent of its manufacturing sector.  Through tapping the potential of SMEs, Malaysia has transformed its economy from agricultural-based, and now it is shifting to a knowledge-based economy even if it aims to attain the status of a developed country by 2018.
Behind this phenomenal growth is an economy that is driven by home-grown domestic policies that have succeeded addressing the needs of the SME sector.
Following the industrial transformation of Malaysia, the manufacturing sector contributes 40 per cent to its GDP, compared with the stagnated 10 per cent for Kenya.  There are obvious lessons we can learn from Malaysia.
Today, Malaysia economy is ranked the 14th most competitive in the world and fifth for countries with a population of over 20 million, higher than the traditional economic giants like Australia, United Kingdom and Japan.  It is also ranked sixth in the world in the ease of doing products that are readily available in almost every market in the world.
Most significant is its top ranking in access to credit, which measures the ease by which SME sector, enabling the sector to obtain the much needed capital to thrive beyond the local market to the export market.
Kenya has a very hardworking, educated and creative people and the many SMEs across the country, attest to this.
If, for instance, the government buys a significant portion of its goods and services from SMEs as a policy, it would provide the growth momentum to export to the region and beyond.  Perhaps it is time we take the ‘Buy Kenya, build Kenya’ a notch higher and walk the talk.

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