Resilience and Rebuilding: MSMEs for Sustainable Development in Somalia

Published Date :

July 7, 2022

Time to Read :

7 Minutes

Each year on June 27th, Micro, Small, and Medium-sized Enterprises (MSMEs) Day is commemorated to honor small businesses' contributions to accomplishing the Sustainable Development Goals (SDGs), promoting innovation and creativity, and creating employment opportunities around the world.

Every year, the commemoration of MSMEs is based on a dedicated global theme to help businesses to have focus on significant issues. This year, MSME Day is being observed under the theme of "Resilience and Rebuilding: MSMEs for Sustainable Development" at the forefront of building back better and stronger from the impacts of the COVID-19 pandemic, climate crisis, and conflicts. In this blog post, we are going to share how #SIMADiLabians have celebrated the day. 


MSMEs Day 2022 in Somalia

Fortunately, small and medium-sized enterprises are a vital element in today's job markets and an important opportunity for young people. Promoting youth entrepreneurship can be a great strategy to create jobs and advance their lifestyle and economic independence. In Somalia, MSMEs play an instrumental role in the country’s economic development & employment creation and account for about 80 percent of youth employment while most of them are informal. During the COVID-19 pandemic, a significant number of MSMEs went bankrupt due to expensive electricity and a shortage of supply chain. Although some MSMEs have been improving and recovering well, new challenges, including the current foreign conflicts and the long-term droughts, are again testing the resilience of the MSMEs.

To raise awareness and support for MSMEs, SIMAD iLab hosted a fireside chat with a panel discussion entitled "Resilience and Rebuilding: MSMEs for Sustainable Development in Somalia" and invited experts in this field on 30 June 2022. The main guest speaker was Prof. Isse Mohamud Halane, Deputy Director-General of the Somali Chamber of Commerce and Industry with the attendance of over 30 MSMEs in light of the commemoration for “Micro, Small, and Medium Enterprises week 2022.”

Mrs. Bahja Shuriye, Head of Women Enterprises Development at SIMAD iLab officially convened and welcomed the guests to the event. Prof. Halane stepped on the stage and widely explained the current status of the Somali MSMEs. He also highlighted the common challenges and opportunities of MSMEs during this triple critical challenges period: the COVID-19 pandemic, current climate challenge, and foreign conflicts.

In addition, Mr. Ali Farah, the Partnership Builder of SIMAD iLab, moderated a mini panel discussion with Prof. Halane on Resilience and Rebuilding: MSMEs for Sustainable Development in Somalia. The panel narrated that MSMEs as key stakeholders in the country in terms of innovations, job creation, and productivity as well as sustainable and inclusive economic growth. It also highlighted that MSMEs in Somalia face challenges including a lack of access to finance, legal registration, and licenses. As per the discussion, it became evident that Somalia needs a financial, political, and regulatory framework to help MSMEs enhance their effectiveness and support their entrepreneurial pursuits.

Furthermore, the MSMEs have shared their thoughts and asked questions to guest speakers whereby the speaker shared contextual insights. The panel also had supplementary remarks from the participants where they explained more about the discussion agenda.

Finally, Mr. Abdirizak Hassan Yusuf, the Director of Investment, Ministry of Commerce and Industry (MoCI) of FGS made the official closing remarks. He mentioned that the Somali government especially MoCI is ready to help and promote MSMEs in Somalia. MoCI has recently approved the MSMEs Act in Somalia and is currently working on Startups Act in Somalia. As per Mr. Abdirizak, supporting MSMEs will help contribute to a better and stable Somalia.

Recommendations:

In summary, these recommendations are the main takeaways from the MSMEs Day 2022 at SIMAD iLab: 

  • Access to finance: Supporting SMEs to get investment with favorable terms from bank institutions to build their innovative products and services. 
  • Policy level – Startup Act: SIMAD iLab to continue lobbying for a legal framework for Startups in Somalia, and
  • Partnerships: The government, the banks, innovation hubs, startups, and MSMEs should all have regular business engagement meetups to build together a thriving local innovation ecosystem.

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