Friday, December 05, 2008

Falling copper prices have had an impact on small businesses – Sichula

Falling copper prices have had an impact on small businesses – Sichula
Written by Nchima Nchito
Friday, December 05, 2008 11:41:41 PM

ZAMBIA Chamber of Small and Medium Business Association (ZCSMBA) executive secretary Maxwell Sichula has said falling copper prices have had an impact on small business in the country.

In an interview, Sichula said the SMEs, just like the rest of the economy, had not been spared by the decline in copper prices as some small businesses depended on mines for their survival.

“It has a tremendous effect on the entire economy including our SMEs. We have witnessed a fall in income generation all round,” he said.

Sichula added that some of his members where suppliers of various products and goods to the mining companies and the falling copper prices meant that there were less activities going on among suppliers of products to the mines.

“The problem of falling copper prices is compounded by the depreciation of the kwacha against the US dollar, making it very difficult for those of our members whose businesses comprise of importing products to resell within the country,” he said.

Copper prices have hit the lowest since 2005, with a tonne of the commodity being quoted at below US $4,000.

And Sichula has advised the government to establish structures and institutions that support entrepreneurship.

In an interview, Sichula said the establishment of supportive structures and institutions for entrepreneurs was important for capacity building among Small and Medium-scale Enterprises (SMEs).

“We need to empower as well as to build capacity. That is why we need to identify institutions that are going to organise SMEs together,” he said.

Sichula said while his organisation appreciated the efforts and work of institutions such as the Citizens Economic Empowerment Commission (CEEC), there were major limitations faced by the institution.

“Giving loans to individuals will have less trickledown effects in terms of benefits than if the loans were given to institutions with proper structures to embark on business,” he said. “We are just scratching the surface, there is so much that needs to be done.”

Sichula, however, acknowledged the efforts of the government in supporting SMEs.

“I am delighted that now we are seeing a deliberate government policy directed towards SMEs,” said Sichula.

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