The Industrial Development Corporation (IDC) has signed a groundbreaking Memorandum of Understanding (MoU) with the Zambia Chamber of Commerce and Industry (ZACCI) aimed at transitioning 300,000 Micro and Small Enterprises (MSEs) into the formal sector over the next five years.
In a statement released on Thursday, IDC Senior Corporate Communication Officer Kingsley Kaswende highlighted the significance of the partnership, which seeks to strengthen small enterprises’ participation in Zambia’s national economy.
“The Industrial Development Corporation (IDC) has signed a Memorandum of Understanding (MoU) with the Zambia Chamber of Commerce and Industry (ZACCI) to actualise the transition of 300,000 Micro and Small Enterprises (MSEs) into the formal sector within the next five years,” Kaswende said.
Boosting Economic Participation
The MoU aims to address the challenges that have historically hindered MSEs from fully contributing to the national economy. Many small enterprises in Zambia operate informally, limiting their access to financing, business development services, and market opportunities.
Formalizing 300,000 MSEs is expected to increase their productivity, enable them to access credit facilities, and participate in public procurement opportunities. This transition will also broaden the tax base, contributing to national development.
Collaborative Framework
The partnership between IDC and ZACCI will focus on creating an enabling environment for MSEs to formalize their operations. This includes capacity-building initiatives, mentorship programs, and access to financial and technical support.
ZACCI, as the umbrella organization for the private sector, will play a pivotal role in mobilizing businesses and providing insights into the needs of MSEs. The IDC, on the other hand, will leverage its resources and expertise to implement programs that support this transition.
Driving Inclusive Growth
Kaswende emphasized that empowering MSEs is a critical step toward achieving inclusive economic growth in Zambia. “The formalization of these enterprises will not only strengthen their operations but also create jobs, increase incomes, and contribute to Zambia’s economic resilience,” he said.
Addressing Key Challenges
Despite the ambitious goals of the partnership, challenges remain. Many MSEs lack knowledge of the formalization process or are deterred by administrative hurdles and costs. To address these issues, the MoU includes provisions for policy advocacy to streamline registration processes and reduce barriers to formalization.
A Vision for the Future
The IDC and ZACCI partnership aligns with Zambia’s broader economic development agenda, which prioritizes the growth of the private sector as a driver of sustainable development. By formalizing 300,000 MSEs, the initiative is expected to unlock the untapped potential of Zambia’s informal economy, fostering innovation and entrepreneurship.
As the five-year timeline begins, the IDC and ZACCI are optimistic about achieving their goals, marking a significant step toward transforming Zambia’s economic landscape and ensuring that MSEs become a cornerstone of the country’s growth.
