There is a link between growth and employment. The government claims to be creating substantial employment in financial year 2012-13. But the question is which pillar of the economy has the potentials of generating high growth and employment? The answer is the small and medium enterprises. The importance of SMEs in the national economy is reflected by the fact that they account for 30 percent of GDP and employ 80 percent of the workforce. The figures would be even higher if the contribution of the SMEs operating in the informal economy were taken into account.
But look at the problems the SMEs are facing. Credit lending by banks has gone to an all-time low, seven percent of the total advances. Electricity loadshedding has severely affected their productivity and profitability. The federal government should call an urgent meeting of all stakeholders to find a workable solution to the problem.