WINDHOEK – The Ministry of Sport, Youth and National Service is well on target towards the realisation of the set goal to establish the 121 rural youth enterprises in all constituencies in the country. This was confirmed by minister Erastus Uutoni last week during the unveiling of a N$138.5 million Small and Medium Enterprise (SME) financing strategy, to commence on 1 December 2019, specifically aimed at enabling the youth to start or expand their businesses.
According to Uutoni, the financing strategy encompasses objectives and desired outcomes as outlined in chapter three of the fifth National Development Plan (NDP5) as well as the Harambee Prosperity Plan pillar on Economic Advancement and in particular the Sub-pillar on Youth Enterprise Development.
“It is a well-known fact that Namibia together with the rest of the world is faced with a global jobs crisis that demands a bold response. To help meet this challenge, the Ministry of Sport, Youth and National Service believes that youth entrepreneurship can be part of the solution to transform unemployed young people into active members of the economy, self-sustaining and contributing significantly to the development of society,” said Uutoni.
He noted that unfortunately, many young people from underrepresented and disadvantaged groups, such as women, youth, and the unemployed, often face greater challenges in accessing start-up financing, often due to a lack of collateral and credit history. “Clearly, in today and tomorrow’s economy, the future of work is increasingly uncertain. In this regard, entrepreneurship can play an important part in facilitating economic development and job creation,” said Uutoni.
He added that while young people often turn to self-employment because they cannot find jobs elsewhere, entrepreneurship can provide them with valuable skills such as critical thinking, decision-making, leadership, teamwork and innovation all of which remain relevant for the rest of their lives.
Said Uutoni: “In general, they gain expertise in areas not incorporated in traditional mainstream education, constructing unique careers that resonate outside the typical economic model by pulling in talent from their peers and fostering positive community development.”
Uutoni emphasised that access to finance is necessary to create an economic environment that enables companies to grow and prosper.
“Young people possess many of the characteristics of the modern entrepreneurship that have been identified by leading economists and social scientists that include vision, enthusiasm, passion, flexibility, determination and resilience. Therefore, increased access of finance for our youth and SMEs can improve economic conditions by fostering innovation and Gross Domestic Product (GDP) growth. Access to finance and capital is also one of the biggest constraints to the stability and growth of many of our existing SMEs and youth enterprises development in Namibia.”
The Harambee Prosperity Plan (HPP) on the youth enterprise development outlined four key desired outcomes with the single-minded objective to stimulate economic activities, especially for young people in rural areas.
At the unveiling Uutoni expressed appreciation for the Development Bank of Namibia (DBN) who he said responded positively to the ministry’s call toward the capacity building of youth entrepreneurship. DBN availed N$1 million for the training of over 484 young people from all the 121 constituencies toward youth enterprise establishment. The training, carried out in conjunction with the University of Namibia, equipped the participating youth with better understanding of business principles for the enhancement and management of the youth owned enterprises.
“I am happy to announce that earlier this year we registered 121 business entities with BIPA (Business and Intellectual Property Authority) for the youth enterprises. The next step then was to assist the enterprises to develop bankable business plans and I am pleased to report that thus far about 60 out of 121 business plans are ready for submission for financing whilst we envisaged to completing the remainder towards the middle of this month,” Uutoni stated.
He continued that empowering young people to build better lives will have a transformative effect on economic growth, social and community development.
“Our young people need to be provided with entrepreneurship skills, information, mentoring and financial support they need in order to become successful entrepreneurs.”
He also thanked finance minister, Calle Schlettwein and his entire ministry as well as Cabinet for prioritising the plight of young people.
“The skill-based lending facility and SME Financing strategy programs which you are launching today will greatly assist our young people, especially those that are skilled to create employment for themselves and others through entrepreneurship. We pledge our concerted and coordinated response across relevant actors in public, private and civil society sectors to recognise the value of non-financial support and expand access to capital to young entrepreneurs,” Uutoni said.