MSMEs urged to tap into government aid
MICRO, small, and medium-sized enterprises (MSMEs) are being encouraged to leverage government grants and facilities to enhance their business operations.
While speaking at the Young Entrepreneur Association of Jamaica (YEA) summit themed ‘A New DAI: Digital Technology and Artificial Intelligence – Keys to Building Better Businesses’ on Saturday at the Jamaica Conference Centre, Oral Shaw, principal director of MSMEs from the Ministry of Industry, Invesment and Commerce, emphasised the importance of government support for young entrepreneurs, starting with the productive input relief.
“It’s a facility that allows you to bring in duty-free and income tax relief on equipment and raw materials for your businesses,” he explained.
Shaw urged small businesses to capitalise on this opportunity to foster growth. By the end of March 2023, 816 companies had benefited from manufacturing status and fiscal incentives under the productive input relief regime. He revealed that in 2021, the industry ministry provided $80.13 million in import tax relief, increasing to $109 million in 2022 and reaching billions in 2023.
While appealing to businesses requiring equipment or raw materials for productive use to take advantage of the relief, he emphasised the importance of adding value to the productive base.
“Your operations should be value-added; you’re adding value to the productive base. So, you will not get this facility if you go to Brazil and bring in Brazilian hair and sell it. It’s just not a productive enterprise,” he clarified.
Shaw also highlighted a low-interest loan facility at the EXIM Bank tailored for micro and small businesses to access. “We offer a concessionary loan facility at a 4.75 per cent interest rate at EXIM Bank, in collaboration with JN Small Business, for micro-entrepreneurs generating sales less than $15 million.” He advised microbusinesses to approach JN Small Business for loans, while SMEs could access loans through EXIM. The maximum loan amount is $5 million.
Businesses must, however, be registered, formal, and tax-paying to benefit from government incentives. Shaw advises businesses to seek assistance to transition to formalisation through the Companies Office, which is ready to aid with registration, business names, and more.
In the meantime, MSMEs are being encouraged to attend the fourth road show on November 21 at the Jamaica Pegasus hotel, sponsored by the IDB, to explore available offerings. “Entrepreneurs are busy, but to access government offerings, these roadshows bring all our offerings to your location,” he said.
Furthermore, Shaw revealed a major digital transformation sponsored by the European Union, targeting 5,000 Jamaican businesses. The initiative aims to transition businesses from a paper-based environment to an e-commerce model, internationalising their operations. The project is set to commence in the fiscal year 2024/25, offering significant opportunities for businesses to thrive through digital platforms.