Economics (FSS)

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Browsing Economics (FSS) by Author "Hassan, Zena M."

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    Constraints to growth of small and medium enterprises in Zanzibar: The case of urban west region
    (Mzumbe University, 2013) Hassan, Zena M.
    Small and Medium Enterprises (SMEs) are very important to the Zanzibar economic growth and hence, the need to ensure that SMEs grow sustainably cannot be over emphasized. At present, however, SMEs growth rate is still limited due to a number of factors that act as the barriers to its growth. This study empirically examined the constraints to SMEs Growth. A survey of 70 small firms was carried out to firms in services, food processing, and agriculture and tourism sectors in Urban West Region of Unguja. The Principal Component Analysis was used to determine dominant constraints, of which five constraints were identified. These include lack of entrepreneur skill, unfavorable government regulations, lack of access to finance, lack of access to power supply, and unreliable of water supply. The constraints were analyzed further to determine the extent to which the identified constraints actually hinder SMEs growth. In this, a logistic regression model was estimated. The result of the analysis shows that unfavourable government regulations and unreliable utility supply (power) significantly hinder SME growth in Zanzibar. Therefore, this study argues that weaknesses and lack of government policy and inadequate provision of power supply do not meet requirements of Small and Medium Enterprises (SMEs) growth. The non government organization supported by central government should provide education concerns with business skills at the same time entrepreneurs should be ready to attend seminars on how to run their business, institutions finance should regulate and reduce constrain on SMEs so as smoothing take a loan . To overcome these obstacles, various measures are suggested include appropriate policies that create conducive environment toward SMEs growth. The study concludes with a discussion of policy implications and areas for further research.