Bankers have apologised to small and medium enterprises (SMEs) over the management of the government COVID-19 relief package and other similar co-funded programs.
These include the Agriculture Credit Facility, which is aimed at helping farmers access cheaper credit and the Small Business Recovery Fund announced mid-last year as a rescue package for micro and small enterprises.
This comes as small and medium enterprises that trade across borders appeal to the governments in the region for measures that will empower them to participate under the African Continental Free Trade Area, AfCFTA.
The AfCFTA was launched in January 2021. However, this has largely been symbolic with no trade activities happening under it, mainly due to reluctance by member states to embrace it. This has led to the maintenance of Non-Tariff Barriers, which the Agreement seeks to remove.
The civil society for the promotion of trade has appealed to the government to put in place financing programs that will enable them to build the required capacity to access the regional and continental markets.
The Executive Director, of the Eastern African Sub-Regional Support Initiative, Sheila Kawamara, says it will be unfortunate for the AfCFTA to take off for example, when such traders, especially cross-border traders are not prepared. She says even the Small Business Rescue Fund has not reached them, especially the women traders.
At the close of the Uganda-South Africa Joint Commission for Cooperation meeting in Kampala, South Africa’s International Relations Minister, Naled Pandor accused the leadership of countries of reluctance to open up to regional initiatives despite signing and ratifying them. She said this will affect the operationalization of the AfCFTA too.
However, for Small and Medium entrepreneurs willing to take up the opportunity, it is more than that.
Jane Nalunga, the Executive Director, SEATINI Uganda, a regional trade promotion NGO, says on her part, that the small traders, especially women lack information on such government projects and end up not benefiting from them.
She, however, calls on the government to make the banking industry more ‘Ugandan’ to be able to focus more on the needs of Ugandans, and also streamline the programs to ensure they are well-focused.
However, the complaints of the women not accessing the funds provided by the government through banks, arise from the fact that commercial banks do not give them a priority, according to reports.
John Walugembe, the Chief Executive, Federation of Small and Medium-Sized Enterprises, says that many bank managers do not tell their customers of the existence of these products, ‘until one comes with evidence’ that that bank is a partner in a program. Instead, the banks prioritize marketing their own products, which are even higher prices, and this in the end affects the uptake of the government rescue funds.
The Executive Director, Uganda Bankers Association, Wibrod Owor said the leadership did not know this but had long noted the slow uptake of the funds. Instead, he says, they had, together with the Bank of Uganda made recommendations to boost the uptake, including reviewing the terms and conditions of benefiting from the fund, thinking that that was where the problem was.
Nalunga also called for more information and sensitization of the people on such government programs because many ignore them out of a lack of enough knowledge.
Kawamara told a media brief on the AfCFTA opportunities for East African Cross-border traders that Women Cross-Border Traders (WCBTs) are among the expected beneficiaries of the AfCFTA, who need to take advantage of the wider trading opportunities and markets, as well as the gender equality ideals entrenched in the agreement.
AfCFTA is anticipated to further boost women’s economic empowerment across the continent. However, she says this will call for not only financing but a review and implementation of policies that will favor them. “In order to ensure that the AfCFTA promotes women’s participation and profitability in regional and continental trade, there is a need to ensure that the trade policies and agreements across the Regional Economic Blocs that comprise the AfCFTA are gender-sensitive,” she says.
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