Jacquelyn Hamer is a retired Guyanese diplomat and a Director of the skills training organization Visions of Excellence.
By Jacquelyn Hamer
If it appeared to readers that my previous comment on the Small Business Act of 2004 sought to repudiate any kind of official role in the building of a strong small business infrastructure then I hasten to say that that was by no means the case. Part of the role of legislation is to create an ordered framework comprising structures and mechanisms that can nurse small businesses to a state of maturity and, certainly, part of government’s role in the building of a small business culture is first, to help with the provision of material and technical resources – whether with state funds or funds secured through grants and loans – and, equally importantly, to serve as an advocate for the private sector, which advocacy can actually help to influence the posture of the commercial banking sector, for example, in its lending policies for small business development.
I repeat, however, that government support for the growth and development of the private sector cannot be equated with government control of the instruments associated with that growth and development since such control leaves those instruments open to “creative” interpretation that can very easily lead to charges of prejudice and perhaps even actual prejudice.
When we examine the Act in detail we discover that much of the seeming intent of the legislation is to assign government some critical responsibilities for the development of the small business sector. The Small Business Council, the highest organ contained in the Act is assigned, among other things, responsibility monitoring “progress made in addressing developmental issues and streamlining administrative procedures relating to small businessmen” and monitoring “initiatives by the government to facilitate access to financing by small businesses.” Implicit in these two responsibilities is an acknowledgement by government of its own responsibility to support the building of structures that facilitate both the administrative and financial resources to support the growth of the small business sector. Those are, to say the leat, critical responsibilities.
Another important function assigned the Council is that of establishing ‘contact and linkages with other organizations, both local and overseas, with similar goals and objectives. This, unquestionably, is one of the Council’s more important responsibilities. Linkages with other organizations, particularly overseas organizations, can open doors to funding and other forms of assistance including various forms of training from sister organizations in countries where small businesses have thrived as well as from the various United Nations agencies, particularly UNIDO and UNCTAD which are active in the building of small businesses in several developing countries.
Then there is the Small Business Bureau, the administrative nerve centre of the entire infrastructure. The real value of the Bureau is that it seeks to serve as a secretariat within which small business issues can be properly administered, hence, for example, its role in promoting development issues” relating to the small business sector and “coordinating programmes for small business development.” In these particular functions the Bureau, presumably, would serve as an advice centre for small businesses and will also concern itself with, among other things, seeking out and administering various training, coaching and other support opportunities for small entrepreneurs.
Two particularly important facets of the work of the reporting function of the Small Business Bureau are those of recording initiatives by the government to facilitate access to financing by the small business sector,” and monitoring the “level of procurement by the government from small businesses.”
These monitoring functions are important particularly for the reason that they provide a verifiable record of the extent to which the government honours what is in effect a legally binding commitment to support the development of the private sector.
Then, of course, there are the financial provisions of the Small Business Act.
The Small Business Development funds many functions including providing both financial and non-financial support “to help small businesses improve their competitiveness and productivity. The importance of funding to the development of the small business sector is, in itself, worthy of mention. What has been sorely missing from the small sector is that “institutional support” to which the act refers which can provide critical support in areas such as packaging, storage, marketing, training, coaching and production techniques, among others.
In sum, what the Small Business Act does is to give expression to the long articulated view that the small business sector is central to the growth of the economy and to job creation. Such small business infrastructure as already exists in the country – and there is evidence of such an infrastructure – can be considerably strengthened through the effective implementation of the legislation. One hoped-for development is that the provisions of the legislation will impact on both traditional and non-traditional small business ventures, bringing several new forms of business into the mainstream economy.
Hopefully too, the full and effective implementation of the Act will open up further opportunities for rural and hinterland business ventures which are so often denied any real support in view of their distance from the capital. Here, for example, there are opportunities for the growth of both the indigenous craft industry as well as the various rural and hinterland agricultural projects many of which never seem to develop beyond the micro-business stage.
Finally, I believe that the full and effective implementation of the Small Business Act could impact positively on the resurgence of co-operatives, providing, of course, that they qualify as small businesses as defined in the Act. Part of the reason for the failure of several small businesses had to do with the fact that some groups, well-intentioned though they may have been, simply lacked the technical and managerial expertise and in many cases only limited access to the kind of coaching which, for example, would have helped them respond to difficulties. Personally, I am a huge supporter of the concept of co-operatives.
I believe that co-operatives, apart from facilitating social cohesion at a community level can actually build a spirit of entrepreneurship in which larger numbers of people can share. What is also noteworthy about co-operatives is that they possess the potential to target and bring out such economic potential as may lay dormant in particular communities but which can be exploited through the example of co-operative initiatives in other communities.
