ARTISANS who have graduated from vocational training centres can now turn their skills into tangible businesses, with access to 60% of the skills-based funding that will be rolled out by the government before the end of the year.
The government has pumped in N$30 million as initial capital for the projects, with the remaining 40% of the funds set aside for loans to young graduates who have bankable business projects.
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This was revealed by finance minister Calle Schlettwein on Wednesday during the launch of the funding strategy for SMEs.
He indicated that the scheme will be rolled out in collaboration with the Development Bank of Namibia, and will target youth below the age of 35 years, in line with the national definition of youth.
The minister explained that the funding framework is skewed in favour of vocational graduates, with 60% of the capital earmarked for this sector, due to the fact that academic graduates traditionally have easier access to funding.
The skills-based funding scheme will cater for both start-ups and existing businesses owned by graduates for as long as they are viable, and participants will benefit from favourable lending rates, low-value collateral and minimum out-of-pocket capital requirements.
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According to the Namibia Labour Force Survey of 2018, persons with post–school education (such as those currently at university, or in possession of a university certificate, diploma or degree, or a post-graduate certificate, diploma or degree) constitute a combined unemployment rate of 51,6%.
The survey also shows that out of the 24 419 vocational graduates who were in the market last year, 33,3% were unable to find employment. However, the situation could be different now as at the time of the survey there were 17 432 who had just completed one or two years of their vocational certificates or diplomas.
The funding initiative also comes at a time when more than 100 000 job seekers compete for the 850 opportunities that were created by the economy within a six month period in 2019, according to the statistics provided by registered employers at the ministry of labour.
DBN chief executive officer Martin Inkumbi told The Namibian yesterday that to qualify for the skills-based funding, graduates who wish to turn their skills into businesses must approach the development bank itself and not the commercial banks for their credit needs.
He called on young entrepreneurs to present practical and financially viable business propositions and advised that their business ideas should be in line with their area of studies.
Inkumbi said young entrepreneurs can start visiting the development bank offices from 1 December 2019 to apply for loans.
Jerry Beukes, chief executive officer of the Namibia Training Authority, deemed the announcement by the minister of finance a welcome development for the technical and vocational education and training (TVET) sector.
Expressing his satisfaction, he noted that although “we are yet to consider the detail thereof, we anticipate the lending facility to advance current efforts aimed at unlocking the employment and entrepreneurship potential of our country’s TVET graduates”.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world