Performance and Challenges of Government Supported Micro and Small Scale Associations in Wolkite and Boutajira City Administrations

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Addis Ababa University


The Primary objective of the present study is to assess and evaluate the general performance and challenges of MSSAs in Wolkite and Boutajira city administrations. In order to meet objectives of the study, various books, journals, policy and strategy documents and regulations were referred. Structured questionnaires were also distributed to 92 selected operators of the associations. Furthermore, 5 officials and experts from both Wolkite and Boutajira cities were interviewed and have provided important information. In the study areas, Wolkite and Boutajira, the MSSEs development program has been implemented since 2003. MSSAs have been established in the areas of construction, Metal and Wood works, urban agriculture, textile and tailoring, municipality services and food processing and preparation. Various support-Services including access to market, finance and credit, spaces, training and counseling, machineries, equipments and inputs have been given to the MSSAs. After carefully looking in to and analyzing the available data, the study has found out that these supports have not been directed towards ensuring sustainability of the associations. The practice of service provision in the two cities is not inline with the principles and objectives of the national strategy. The associations exhibit high closure rate and dropout of members. They cannot create long-term jobs. The participation of women in the association is also found insignificant. The study has also come up with the fact that the associations have been given priority in the market access from the public institutions. Even if this priority helps them to get market at the start-up stage, it makes them also entirely dependent on single market opportunity from the government that limited their over-all performance Because of this over-protection and dependence, the associations finally become politicized and they are not market-oriented entities. The MSSAs also suffer from various challenges and constraints. Among them, the fact that they face shortage of access to technical and vocational training, spaces, finance, inputs and better machineries and equipments. There is no any networking among the associations. Members are also not clear about the legal forms of their associations. found weak. The expected linkage with TVET institutions is also Furthermore, the associations do not have necessary accounting records and do not prepare financial statements regularly so that analyzing their financial progress is found difficult. MSSAs in order to play the expected role in socio-economic development of the two cities, establishing large number of associations and providing them support alone is not enough. All support services must be designed in such away that ensure sustainable growth of the associations and the attitudes of members should be also shaped through continuous awareness programs. As much as possible, they should be insulated from the direct political involvement. Furthermore, problems related with the access to space, finance, inputs and other services should be settled



Boutajira city administrations