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NWCCI express concern over US$500,000 SME benchmark for Lumwana MFEZ

NWCCI express concern over US$500,000 SME benchmark for Lumwana MFEZ
By David Chongo in Solwezi
Tue 17 Aug. 2010, 04:00 CAT

NORTH Western Chamber of Commerce and Industry (NWCCI) members have indicated that most Small and Medium Enterprises (SMEs) will not reach the US $500,000 benchmark required as minimum investment in the Lumwana Multi Facility Economic Zone (MFEZ).

The members who raised this concern following a presentation by Lumwana Mine representative Christopher Mukala during the chamber’s monthly meeting on Thursday, called on the Zambia Development Agency (ZDA) to lower the threshold for maximum participation of local companies.

Mukala, during the meeting, revealed that capital outlay for potential investors in MFEZ was pegged at not less than US $500,000 (approximately K2.5 billion) for approval.

But NWCCI president Brendah Kunda said US $500, 000 was too huge for most businesses in the area, a situation that could disadvantage them from seizing business opportunities in the economic zone.

However, Mukala assured that government had met Lumwana management on the concern and that there were plans to review the threshold downward in time for issuance of application forms late September.

“On the minimum investment of US $500,000, most SMEs are complaining; but the government plans to review this amount from US $500,000 to US $100,000 to allow SMEs to participate in the MFEZ,” said Mukala.

And Kunda acknowledged government’s intention to downsize the requirement, but said NWCCI would still take the case to the ZDA as an immediate concern for fear that most SMEs would miss out on business.

“I can assure you, people will fly over us and get business in the MFEZ and we shall be the ones left in poverty. That MFEZ will go for five years and we shall not get anything,” said Kunda who is also proprietor of Bresmar, a local contractor.

And Investrust Bank relationship manager for Solwezi and Lumwana Richard Malwa challenged SMEs in North Western Province to consider partnerships when applying for hefty loans from banks in order to access bigger supply contracts to the
mines.

Malwa said in a presentation that SMEs in the region could access massive opportunities for high value contracts with the mines if only they pooled their resources together.

He said the banking community was ready to help businesses whose plans were based on realistic projections that encompassed creative viability and economic growth.

Malwa was responding to NWCCI members’ concerns that banks were in the habit of exciting SMEs with easy-to-get loans and attractive maintenance fees when actual circumstances were different.

Labels: CHRISTOPHER MUKALA, MFEZ, SMEs

posted by MrK @ 7:02 AM