By NATARIO McKENZIE
Tribune Business Reporter
THE proposed agency to facilitate Bahamian small and medium-sized businesses will help to reduce their risk profiles, according to minister of state for finance, Zhivargo Laing, who said this will ultimately allow them greater access to capital.
Speaking at a meeting of the Rotary Club of West Nassau, Mr Laing said the Small and Medium-Sized Enterprise Development Agency (SMEDA) will also have the ability to raise its own funds, and to access funds that exist through the private sector arms of multilateral institutions.
Mr Laing said: "I think we are going to, over the next five years, have to do something new in terms of how we support small and medium-sized businesses.
The reality is that the banks do not want to touch many of their loan requests because their risk profiles are too high. That is so because there is poor business planning and poor support in terms of business operations. What we need is a facility that helps to minimise that risk of small and medium-sized business.
"We need to give small and medium-sized businesses the opportunity to create business plans that can withstand the scrutiny of any institution in the world. We have to give them the ability to get the administrative, management, legal and technical support they need in the course of their operations, and we are seeking to do that by developing what we are calling the Small and Medium-Sized Development Agency (SMEDA).
Mr Laing added: "The job of that agency would be to reduce the risk profile of small and medium-sized businesses so they can access capital. SMEDA is going to be populated and run by business people.
"The state, which now provides funding for a number of means to support small and medium-sized businesses, will divert some of those funds to the efforts of SMEDA. SMEDA will also have the ability to raise its own funds, and to access funds that exist through the private sector arms of the multilateral institutions of the world."