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SMEs challenged to set eyes on higher productivity, new markets through Japanese agency training

Small and Medium-sized Enterprises (SMEs) receiving training through a collaboration between Kenya Institute of Business Training (KIBT and Japan International Cooperation Agency (JICA) have been challenged to ride on improved productivity to expand into new markets.

During a seminar themed ‘Enhancing Enterprise Competitiveness Through Aapplication of Japanese Management Excellence,” the SMEs were urged to use the training to acquire competitive advantage and set eyes on the export markets.

“JICA is pleased to be associated with the implementation of this project in Kenya whose aim is to promote sustainable growth of SMEs and entrepreneurs in Kenya.  The project focusses on training and on-site consultancies in the areas of quality and productivity improvement, marketing and sales as well as on financial management,” said Mr Hajime Iwama, chief representative of JICA Kenya office during the Wednesday seminar held in Nairobi.

“SMEs have to become more competitive and productive at their home base to enable them integrate into global value chains through trade and investments including linkages with foreign direct investments. Building on this foundation, this project has expanded to include the export-oriented manufacturing sector,” added Mr Iwama.

 The project, which was signed in 2019, targets enterprises within Nairobi and its environs, Eldoret and Mombasa. The term of cooperation runs from January 25, 2021 to February 28, 2025 with room for extension.

The project, among other deliverables, enhances the ability of small enterprises to access financing by equipping them with knowledge such as that of preparing financial documents for loan screening.

SMEs are also put in an ecosystem for interacting and collaborating with trade and financial institutions including Kenya Bankers Association to improve their business processes and receive support from financial institutions and investors.

A survey by the Kenya National Bureau of Statistics (KNBS) showed 2.2 million micro small business shut down in the five years ending 2016.

The figure is an equivalent of approximately 440,000 MSMEs closing yearly, a statistic that the JICA training wants to overcome by equipping small firms with new skills set to run sustainably.

JICA, through Japan Productivity Centre in collaboration with KIBT, has so far trained 18 firms and targets to hit 48 by end of the project. In addition, it has trained 15 master trainers and 20 trainers.

According to JICA, it will have trained 35 master trainers and 60 trainers by the end of the project, enabling them to roll out consultancy services for other enterprises looking to enhance business competitiveness.

“JICA has assisted our trainers and I believe the pace of expanding to reach more firms will be rapid because those already trained will be able to train others,” said Dr Catherine Waweru, director of KIBT.

Speaking at the seminar, Dr Haron Komen, the director of administration in the State Department of Micro, Small and Medium (MSME) Enterprise Development, said the JICA project is key in the technical transfer of the Japanese philosophy and tools of management excellence to Kenyans firms.

“It is expected that by the time of the completion of the project, all involved pilot enterprises would transform by achieving productivity, be more competitive in the market and serve as model enterprises for bench-marking by other SMEs,” said Dr Komen.

“There are new and emerging markets in places such as middle East which Kenyan firms can take advantage of. We need to put these ideas into practice and manufacture high quality products to satisfy what has been set in overseas markets,” added Dr Komen.  

During the seminar, Kega Fashions, an apparel manufacturing firm that has also participated in the JICA training was feted for emerging the winner of Excellent Award in SME Category during the Africa Kaizen Award 2022 held last month.

Kenya government’s vision 2030 identified the promotion of Small and Medium-sized Enterprises (SMEs) and human resources development as key in achieving the desired 10% annual GDP growth.

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