Swisscontact Chairman Meyer Visits Nepal; Stresses on Growth of SMEs to Boost Economy

Chairman of Swisscontact, Mr. Thomas D. Meyer, visited Nepal from June 1st to 3rd to acquire the first-hand information on the activities of Swisscontact in Nepal and to take part in a panel discussion on “Unlocking Investments in SMEs for Inclusive Economic Growth,” which was organized by Swisscontact.

The main objectives of the visit were to meet and get to know the Swisscontact Nepal team and deliver few key messages to them, get updates on the projects implemented by Swisscontact in Nepal, and to promote the idea of private sector engagement in development cooperation in Nepal.

He kicked off his visit with a visit to the Swisscontact Nepal office on June 1st where he reviewed the progress made on various projects implemented by Swisscontact, received latest updates on regional activities, and interacted with the team. Later that day, Mr. Meyer visited Nepal Dairy, partner of Commercial Agriculture for Smallholders and Agribusiness (CASA) Programme of Swisscontact and discussed ways to commercialize the dairy industry and get maximum benefits to the stakeholders. 

He then interacted with small and medium enterprises (SMEs) who were the winners of the 1st round of the Sahaj Challenge Fund operated by Nepal Agricultural Market Development Programme (NAMDP). He discussed the opportunities and challenges of SMEs in Nepal and gave inputs to further develop the sector.

On June 2nd, the second day of his visit, Mr. Meyer interacted with Sector Skills Committee of the National Vocational Qualifications Systems (NVQS) programme. He discussed the private sector’s involvement in the overall development of technical and vocational education and training (TVET) sector. 

Later that day, he met and interacted with the representatives of Association of Craft Producers who were supported by experts of Senior Expert Contact (SEC) to discuss the SMEs involved in producing various traditional crafts.

Mr. Meyer also conducted a meeting with start-up entrepreneurs to know about the challenges, issues, and opportunities of the start-ups in Kathmandu.

Panel discussion on “Unlocking Investments in SMEs for Inclusive Economic Growth"

On June 2nd, Mr. Meyer took part in a panel discussion on “Unlocking Investments in SMEs for Inclusive Economic Growth,” which was organized by Swisscontact to explore opportunities to stimulate investments for SMEs while examining the hurdles that SMEs in face in Nepal.

Besides Mr. Meyer, the panelists included well-known names in Nepal’s development and private sector – Ms. Anupama Khunjeli, former Chief Executive Officer of Mega Bank, Mr. Raj Gyawali, founder of Socialtours, Mr. Semanta Dahal, partner at Abhinawa Law Chambers, Mr. Surya Karki, founder of Delish Dairy, Ms. Sonika Manandhar, founder of Aloi and Chargé d'affaires of the Embassy of Switzerland in Nepal, Ms. Silvana Hogg also participated as one of the panelists. Senior editor and presenter Ms. Shivanee Thapa moderated the panel discussion.

Key drivers to stimulate inclusive economic growth

Globally, SMEs account for more than 95% of registered firms, provide more than 50% of jobs, and contribute more than 35% of GDP in emerging economies. In Nepal, SMEs are defined as firms with a fixed capital between NPR 2 million and NPR 500 million2 and constitute a mere 4.5% of total registered enterprise. The growth of SMEs in Nepal has been slow due to structural and contextual challenges. One of the most significant challenges is securing the necessary finances for growth.

The panel discussion focused on the opportunities around key drivers to stimulate inclusive economic growth in Nepal through the SMEs and discussed the key challenges for the SMEs. New financing and investment opportunities for SMEs in Nepal and the role of development partners in stimulating SME growth/competitiveness were stressed during the discussion. The panelists also shared breakthrough ideas and insights analyzing approaches to resolve discussed issues and explored opportunities for stimulating investments for SMEs to ensure sustained and inclusive economic growth. 

The key takeaways from the panel discussion include the following:

  1. Majority of start-ups and micro-entrepreneurs do not have the entrepreneurial mindset to scale or grow to become an SME which is a key constraint for SME growth. 
  2. Traditional collateral-based lending does not cater to start-ups and SMEs. They need innovative financing solutions to meet their capital requirements.
  3. Some of the other key growth constraints faced by enterprises include small and competitive market size leading to a race to the bottom, lack of competent human resources to plan effectively and drive operations excellence, and a business and regulatory environment that is not conducive to SME growth.
  4. There is a need to work in geographic areas and sectors through SMEs where large number of poor people is engaged to drive inclusive growth.
  5. Long term commitment compared to shorter timeframe projects is imperative to improve the situation as the required changes have a longer gestation period. Likewise, close coordination amongst stakeholders is vital.

The event provided a platform for entrepreneurs, investors, and policymakers to understand the opportunities, connect with the stakeholders, and build possible partnerships. It is expected that the solutions and international best practices shared in the programme will help set a stage for future collaborations and create new pathways for SMEs growth in Nepal.

On the final day of his official trip, Chairman Meyer held a meeting with investment advisors and professionals - Ashutosh Tiwari of SAFAL Partners, Siddhant Raj Pandey of Business Oxygen and Suman Joshi of One to Watch. The main focus of the discussion was around private investors’ interest in Nepal in uplifting the SMEs and how they could play a vital role in the overall growth of the national economy. He also visited the Swiss Agency for Development and Cooperation (SDC) where the session was about sharing Swisscontact’s global strategies and approaches, current development challenges, discuss issues in the context of Nepal and to understand the ongoing SDC mandates.

Chairman Meyer ended his three-day visit with a small debriefing session with the Swisscontact Nepal team and gave them guidelines to work incessantly towards achieving the goal of the organization.