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Minister speaks against fronting

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Minister of Trade Sosten Gwengwe has asked small scale businesses in the country to avoid fronting, saying it is against trade regulations.

He said the tendency is also tantamount to frustrating businesses.

Gwengwe said this after his ministry observed that some business transfer their licences to others after failing to operate.

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“This is one way of empowering local SMEs so that they should bridge the gap between the poor and rich and, in the end, it will widen our tax base, hence it will make life for most Malawian bearable,” Gwengwe said.

Meanwhile, Executive Secretary for Chamber for Small and Medium Businesses Association James Chiutsi has commended the government for ensuring that businesses are fully supported.

“We have noted strong sentiments by the President supporting SMEs through the gazetting of the MSME Participation Order of 2020 last December. The indigenous business community has been excited as government business is now trickling in to indigenous business people” Chiutsi said.

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The chamber also concurred with Gwengwe in discouraging fronting by unscrupulous businesses.

Notably, among the pioneers of implementation of the MSME Order 2020 is the Ministry of Health through Central Medical Stores Trust, which has positively responded to the law by awarding contracts to indigenous people in the supply of personal protective equipment.

However, Chiutsi said his organisation is yet to see periodic procurement and disposal plans from government ministries, Departments and agencies.

The chamber is encouraging SMEs to form partnerships, joint ventures, cooperatives and consortiums for maximum productivity.

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