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3.3 Major Constraints facing the MSM sector: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
| Guest post by: International Labour Organization |
Article Overview: There are two levels of constraints facing MSMEs in Tanzania, those acting as barriers to general operations and those impeding growth. The UNDP, ILO and UNIDO (2002) report concluded with a list of factors impeding the development of informal MSEs:
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Free Download - References: Learning to change: Skills development among the economically vulnerable and socially excluded in developing countries By International Labour Organization |
3.3 Major Constraints facing the MSM sector: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
There are two levels of constraints facing MSMEs in Tanzania, those acting as
barriers to general operations and those impeding growth. The UNDP, ILO and UNIDO
(2002) report concluded with a list of factors impeding the development of informal
MSEs:
• the low level of education of the entrepreneurs;
• the lack of managerial, marketing and production skills;
• the use of rudimentary technology;
• the low-skilled work base;
• lack of access to credit;
• the tiny purchasing power of their consumers/clients; and
• regulatory constraints stemming from the difficulties of obtaining legal status.
In determining barriers to MSME growth, Rural Programme on Enterprise
Development (RPED) surveys completed over the 1993-95 period, revealed that the most
serious constraint was related to credit access, followed by market-related problems
(demand and competition), problems with inputs, and lack of infrastructure (Verspreet
and Berlange, 1998. See table 5). The ranking and intensity of constraints varied by size
of the enterprise. Problems related to infrastructure, inputs, taxation, regulation, and
skilled labour became more serious for medium-size enterprises.
Table 5: Main constraints as perceived by firms (by firm size)
Constraint Micro (%) Small (%) Medium (%)
Credit-related problems 85.6 75.0 63.3
Demand or competition related problems 49.3 42.3 36.6
Regulations related problems 7.7 2.3 13.0
Tax burden 9.7 10.3 14.0
Lack of infrastructure 12.0 9.7 38.7
Lack of support services 9.0 11.7 12.0
Lack of skilled labour 7.7 7.0 11.0
Investment capital related problems 11.3 10.0 4.0
Problems with inputs 16.7 17.3 24.7
Macroeconomic problems 3.7 4.3 7.7
1.2 Mission Objectives: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
8.0 Promotion of women’s entrepreneurship: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
4.0 The state of women’s enterprises in Tanzania: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
5.0 How is the performance of businesses affected?: Gender Entrepreneurship and Competitiveness in Africa, 2007
1.0 Overview: Gender Entrepreneurship and Competitiveness in Africa, 2007
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About the Author: International Labour Organization RSS for International's articles - Visit International's website Click here to visit International's website   20 Work and the life cycle of poverty Working Out of Poverty 28 The foundations of a decent work strategy for poverty reduction Working Out of Poverty 102 Prestartup training Support for Growthoriented Women Entrepreneurs in Tanzania 2005 20 The economic context Support for Growthoriented Women Entrepreneurs in Tanzania 2005 45 Improving the performance of public services and formal sector enterprises Working Out of Poverty |
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