Vol. 5 Num 1113 Wed. July 18, 2007  

SMEs in rural areas to reduce regional income disparity
Finance adviser tells SME Foundation launch

As regional income disparity is growing across the country, setting up small and medium enterprises (SMEs) in remote rural areas could be the best instrument to help reduce the disparity, said Finance and Commerce Adviser Mirza Azizul Islam.

He said this while formally launching SME Foundation at a function in Dhaka yesterday.

The adviser vented his disgruntlement over the commercial banks' mindset towards women entrepreneurs, saying most of the banks do not duly encourage financing women businesses.

The SME Foundation would help ensure gender equality in industrialisation, credit wholesaling, employment generation and poverty reduction, Mirza Aziz hoped.

He said the government in the current budget has allocated Tk 100 crore for the SMEs as endowment, and the money will be disbursed soon from Bangladesh Bank Small Entrepreneur Fund.

Industries Adviser Geeteara Safiya Choudhury chaired the function where Country Director of Asian Development Bank Hua Du, Bangladesh Bank Governor Dr Salehuddin Ahmed, SME Foundation Chairman Abdul Muyeed Chowdhury, President of the Federation of Bangladesh Chambers of Commerce and Industry Mir Nasir Hossain, Industries Secretary Nurul Amin and Project Director of SME Foundation Aiyub Miah spoke.

The finance adviser hopes if the current industrial growth continues, the country will be able to achieve the millennium development goals (MDGs) in time.

He has expressed optimism as the industries ministry has prepared an action plan for women entrepreneurs and a niche has been carved for them at the SME Foundation.

He called upon the commercial banks to provide fund for women entrepreneurs through evaluating their specific projects, not through traditional collateral system.

If the banks do not give collateral-free loans to women entrepreneurs, they will never get bank financing since most properties such as land and house are generally owned by male.

Geeteara Safiya said SME Foundation can help women entrepreneurs get fund, technical expertise, identify markets for expansion of their enterprises, and find new areas for making investment.

Suggesting that the foundation be developed as a corporate body, Hua Du said the most challenging task before the SME Foundation is to make it effective, productive and sustainable.

The central bank is working out ways on how the commercial banks can provide the SMEs with collateral-free loans, said Dr Salehuddin Ahmed, adding that more collaboration is needed between the commercial banks and financial institutions to help the SMEs best.

Finance Adviser Mirza Azizul Islam speaks at the launching ceremony of SME Foundation in Dhaka yesterday. Country Director of Asian Development Bank Hua Du (L), President of the Federation of Bangladesh Chambers of Commerce and Industry Mir Nasir Hossain (R), and Chairman of SME Foundation Abdul Muyeed Chowdhury, are also seen. PHOTO: STAR