Phalraj Servansingh: “SMEs gaining an edge and becoming more popular”

SMEDA is organizing its yearly SME Fair at the Swami Vivekananda International Convention Centre, Pailles from 12 to 14 May 2017. The objectives of this year’s fair are to support SMEs innovation activities. The event will embrace both the technological and non-technological dimensions of innovative activity and to create the most effective linkages to facilitate the transfer of technology, know-how and skills to Mauritian and overseas enterprises through the showcasing and eventual acquisition of technological tools and equipment particularly of assistance to SMEs. News on Sunday met Phalraj Servansingh, the Managing Director of SMEDA, and asked him of his objectives since he took over the organization in December 2015. 

What is your vision for the SMEs?

My biggest wish is to see the SMEs grow to become more productive and to contribute to the economic development of the country, particularly to meet the wish of the government at making of this organization the main source of employment and turning it into the fourth pillar of the economy. The fair is being held, as you know, in collaboration with the Ministry of Foreign Affairs, Regional Integration and International trade and the Mauritius Chamber of Commerce and Industry. SMEs are divided as the name suggests small and medium enterprises. Small enterprises are rather family businesses and services with a yearly turnover of not more than two million rupees per year. Medium enterprises have a turnover up to fifty million rupees per year. There are around 125,000 (one hundred and twenty five thousand) SMEs in Mauritius with the following breakdown – 80,000 micro enterprises, 30,000 small and 15,000 medium enterprises. Our objective at the SMEDA is to help these enterprises to grow and participate fully at contributing consistently at our GDP.

How many SMEs are under your control; what is their output and their contribution to GDP?

We have 25,000 enterprises registered at the SMEDA. I appeal to all entrepreneurs that there are still possibilities to get registered at the SMEDA where they can be provided with the necessary expertise to better their production or their services. SMEs are providing 300,000 jobs representing around 50% of our workforce and generating up to 40% of our GDP. We have fixed our objective at growing to 50%-55% of the GDP. For the time being only 5,000 medium enterprises are exporting their products or services. Competition is high on the global market. We are striving to upgrade our local production so that we can compete on the international market. For the year 2014-2015 we have exported for an average of 14 billion rupees. We can do better.

What are the incentives provided by SMEDA?

We give them the means to be competitive so that they can export their products and services; that they adhere to norms and quality. As you know goods imported and put on sale on the local market are doing a lot of harm to our local products; it is difficult to prevent them getting in because of the number of agreements signed with countries where customs tariffs and barriers are taken off thus making business global. The second thing we provide is a ‘Business Diagnosis.’ We identify an enterprise needing revamping- we provide a consultancy service that will help provide the means to produce better and with quality products.

The third step taken by SMEDA to help an SME is to provide consultancy for a good management of their industry. There are many enterprises set up as a family business. The consultant will help the entrepreneur to be a manager, producer, HR, technician, marketing officer and exporter altogether. Furthermore the entrepreneur should be able to manage a budget through a proper business accounting and stock management. Very often the entrepreneur mixes issues- he cannot make the difference between personal and business budget; what he spends for utilities- water, electricity, transport and consumption are mixed up with expenses made by the enterprise when in fact it should be clearly separated so as to get the real cost of a product and thus the real revenue and eventually the real profit made.

SMEDA has put in place LEMS which is already announced in the BUDGET. LEMS stands for Leasing of Equipment for Modernisation Scheme. This scheme helps at providing subsidies at different levels for entrepreneurs to modernize their equipment.

What are the institutions put in place to serve the entrepreneurs?

One of the main institutions is MyBiz with the objective to guide entrepreneurs towards a sustainable and successful enterprise. It also fosters an environment which is conducive to business development and growth. MyBiz targets aspiring entrepreneurs who have a business idea but no clue how to go about and those who want to expand their business further.

What are the services offered by MyBiz?

First SMEDA conducts a screening exercise to identify the requirements of the SME and provide appropriate information to potential entrepreneurs and assist them in business planning. There are around fifteen bodies to provide information and process application for various permits and licenses required for different types of businesses. Finally MyBiz works in close collaboration with Maubank to provide financial assistance to SMEs under specific conditions, based on their performance, realities, requirements and repayment capacity. MyBiz thus offers an innovative solution to the administrative hassle of new and existing entrepreneurs by grouping under one roof support services and facilities required for them to start and grow their business.

When do you plan to fully implement the SME park project?

SMEDA provides space for entrepreneurs to change their ideas into products. We have already started such projects at La Valette in Bambous, at La Tour Koenig and at Roche Bois thus providing space and facilities to 125 enterprises. Two other such parks will be constructed at Plaine Magnien and at Providence to shelter 200 other SMEs.

Apart from SMEDA are there other institutions interested in the development of SMEs in Mauritius?

We are happy to see that many institutions are interested to help entrepreneurs grow their business. We witnessed at the beginning of February the Mauritius Chamber of Commerce and Industry providing a five-day workshop for entrepreneurs where they got acquainted with the tricks of the trade. The MCCI also proposes the MCCI SME Marketplace which is an online portal whereby the MCCI uses its network of expertise and knowledge to bring support to its SME membership by providing them products and services at an exclusive rate. It also allows service providers to tap into the MCCI SME membership by offering preferential rates for a wide range of professional products and services or visit the link http://www.mcci.org.

The Mauritius Union has also proposed a Bizpack to entrepreneurs so that they can get acquainted with the different steps to take to make of their business a fruitful enterprise. Finally, we are glad to see that the civil society too is interested at promoting SMEs. On 15 February the Lions Club of Curepipe launched, in collaboration with the Sugar Industry Labour Welfare Fund a training workshop under the theme ‘Entrepreneurs on the Move.’ Among the participants were family business members, young restaurant keepers, and family business leaders in textile. Mauritius Telecom too is interested to provide internet facilities to help entrepreneurs.

As you could see, SMEs have got the edge and is getting the attention of not only the authorities but of the majority of Mauritians who wish to see the island grow to become the commercial hub of this part of the world.