No clear pathway for SMEs

OP/ED

The Small Business Development Corporation (SBDC) was established in 1992 following the enactment by parliament of the SBDC Act in 1990.

It is explicitly mandated by the national government to implement policies and programmes aimed at developing, expanding, promoting and growing the informal sector and the small and medium-scale indigenous businesses under the SME policy of 1998 through the development of entrepreneurial skills, provision of financial assistance programmes and other support or extension services.

Core functions of the SBDC included support and development of village-based cottage industries and informal economic activities through the development and application of appropriate technologies that are affordable with the aim to increase community participation and maximise use of local resources.

Following a small to medium enterprises (SME) policy in 1998, the organisation was tasked to identify constraints in developing indigenous businesses in the country.

The constraints identified included:

*Lack of management and accounting skills;

*Access to credit facilities, access to technology and skills;

*Access to information;

*Lack of access by women into the business/commercial sector; and

*Problems dealing with quality and certification issues under the National Institute of Standard and Technology.

The SBDC was invited to give evidence last November before the bi-partisan parliamentary committee investigating the anti-Asian businesses riots of May last year. The corporation was represented by caretaker managing director Diri Kobla and several other officers.

SBDC is the key organisation charged with developing young PNG entrepreneurs in small to medium scale industries which is the sector complained of as being taken over by foreigners.

Yet, during the inquiry, it became obvious that the government itself was uncertain whether or not to keep the SBDC and, indeed, seemed unaware or unappreciative of its role in the economy. As an example, in 1999, the organisation was abolished altogether before it was re-established two years later.

It was said at the inquiry that, presently, there were applications by PNG businesses for credit amounting to K35 million but the SBDC did not, at the time, had that kind of money.

In addition, it did not have any institutional memory on how many businesses it had assisted and, indeed, how many businesses were out there that might need assistance.

Promotion and advertising of its existence to the public had been slow and weak.

There is a desire to assist the people but the capability and capacity is simply not there.

It is obvious from this evidence why there is so much frustration building up among Papua New Guineans. Many are willing and turn to organisations like the SBDC for help to start out, but their applications are often turned back for lack of money to support their enterprise. That is when they get angry at both the government, which they see as suppressing their enterprising spirit, and at foreigners, who they see easily getting into businesses which they know to be clearly reserved or which Papua New Guineans have the expertise to engage in competently.

In a climate of change and exciting new opportunities, institutions and individuals must compete for recognition and attention from both the employer above them and the clientele below them – to have the wherewithal to sustain such recognition and attention when they are received; and to produce credible and ever-improving results.

To not do so would be to surrender to a brief life of redundancy in obscurity and, any use that it might have had, will be altogether forgotten by time and history.

The SBDC has a duty statement that will be the envy of similar organisations, a good enabling legislation and environment, but appears closeted in a dark corner with little resources and recognition.

Its full potential could never be realised by both the government, which must resource it, and by the people of PNG who are its clientele.

It is necessary to have the organisation reinvigorate itself to become that organisation that will drive the small PNG business and commerce sector forward and establish the real foundation for economic independence and true prosperity.

It is not a new vision. That is its mandate.