The Role of Local Government in Promoting Small Scale Business in Addis Ababa City
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Date
2024-06-11
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A.A.U
Abstract
The business environment for small and medium-sized enterprises has become increasingly complex, dynamic, and uncertain as a result of several constraints. As a result, businesses should collaborate with regional governments to strengthen their efforts to stay competitive in the market. To increase the flexibility and competitiveness of small and medium-sized enterprises, local governments must encourage small scale business initiative. This study, therefore, examined the role of local government in supporting MSMEs from commencement of their business and during running it. The study employed a mixed method approach using both quantitative and qualitative data. A total of people from the enterprises could be reached for this survey are 126. The finding of the study indicated that the government's involvement in enabling and supporting SMEs is crucial to their survival since it is a key decision maker on the provision of means of production such as land facilities. The government is the one that shapes the favourable or unfavourable environment that enterprise in a city face. In areas on which the government pays little attention to SMEs sector, then, the sectors have been prone to suffer and leading to many businesses being unable to survive. The government budget and technical capacity limitation also the challenge in the government side. Generally, all things considered, government has made a important effort to foster an atmosphere that encourages businesses to invest and support the national economy based on the available human as well as financial capacity. But still shows role limitation compared with the business demanding and expectations. So the local government need to strengthen its financial as well as institutional capacity to be able to play adequate promotional role for small scale business expansion and growth.
Keywords: Local Government, Small and medium scale business, competitiveness.