Policymakers and business leaders discuss SME competitiveness

21 September 2014

“[Africa] is the continent with both the most poverty but also the greatest promise,” declared Arancha González, Executive Director of the International Trade Centre (ITC), at the opening ceremony of the World Export Development Forum (WEDF) on September 16 in Kigali, Rwanda. The ITC had organised the WEDF 2014 under the theme of the role of small and medium enterprises (SMEs) as engines for trade-led growth and sustainable development in Africa.

During the three-day forum, 1200 policymakers, business leaders and representatives for trade support institutions discussed SMEs and their integration into global value chains. Moreover, they secured over 100 business generating deals and agreed on an initiative to increase public procurement contracts for women vendors during an event organised on the sidelines of the forum.

SMEs competitiveness

Addressing delegates at the opening of the WEDF, President of Rwanda, Paul Kagame stated that competition was an opportunity rather than a problem.  He then called African countries to build competitive and modern economies through smart investments in human capital, and productive knowledge.

“After all, real wealth is in the head, not in the ground.” he said before referring to the need to develop high-quality skills and broadband connectivity for  innovation and entrepreneurship.

A major challenge is to bring the benefits of trade to LDCs where most businesses are SMEs. The solution lies in finding a competitive edge in developing local productive capacities.

Gonzalez referred to the “unfinished development challenge” that needs to be tackled through “entrepreneurship, trade, SMEs and women economic empowerment.” 

SMEs play a major role in developing countries’ economies and in least developed countries, where, according to the ITC, they account for 80 percent of jobs across all economic groups, including women and youth.

“SME competitiveness is also a key factor in determining a country’s overall competitiveness and its ability to respond to international market demand.” precised Gonzalez.

“Sub-Saharan Africa is the world's second fastest-growing continent in economic terms (…) [and] has become the 2nd most attractive investment destination in the world,” González told the assembled participants. She underscored that “it is now about turning local value addition into more jobs, sustained growth, and a more inclusive development.”

In this context, González pointed to the pivotal role of the over 50 million micro, small and medium-sized enterprises employing nearly 60 percent of African workers.

González emphasised that “while businesses in Africa were until recently focused on the extractive sector, today the biggest opportunities lie in greater local value addition to Africa's assets in agri-food, manufacturing and increasingly in services.”

The subsequent plenary discussions focused on topics such as unlocking SME competitiveness by creating an enabling business environment; boosting SME participation in international trade through trade facilitation and regional integration; capitalising on South-South trade opportunities and attracting investments; tapping trade opportunities for SMEs in tourism; and buying goods and services from women-owned businesses.

Sources: ITC,  Global Travel Industry News, Tourism for development: opportunities for SME trade, September 14, 2014; allAfrica, WEDF 2014 Plenary Sessions to Highlight Job Creation through SME Exports, September 12, 2014 

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