A Dissertation to be submitted to Mzumbe University Dar Es Salaam Campus College as a Partial Fulfillment of the requirement for the Award of Master of Business Administration Degree of Mzumbe University
The aim of the study was to assess the role of the government in improving the performance of SMEs. In order to fulfil the aim of the study, the researcher focused on issues relating to the legal framework within which SMEs operate, government-supported BDS and their impact on the growth of SMEs and lastly, the state of the physical infrastructure and how it facilitates the growth of SME’s.
The study carried out both theoretical and empirical literature review which revealed that there was a definite relationship in a nation’s legal framework and the growth of SMEs. The literature review also showed that BDS and infrastructure were important aspects that determined the growth of SMEs.
The study used both primary and secondary data. The study used a sample of 40 units
of SMEs in Dar es Salaam region. Respondents were chosen from Ilala district. The
sample included all categories of SMEs representing almost all types of businesses.
Primary data were collected using structured questionnaires. Secondary data was also
used in the research. This data was obtained from SME records, government profiles of
SMEs and the various policies relating to SMEs. The collected data was edited, coded and tabulated. The data analysis was done using simple statistics and in particular percentages. This data was then presented in tables.
The findings of the study showed that the legal framework in general was poor and
complex and thus unsupportive to the development and growth of SMEs. However,
individual components of the legal framework such as licensing and registration were
seen to be effective in contributing to the growth and development of SMEs. The
results of the study also showed that the BDS offered to SMEs by the government have
done little to improve the growth of SMEs. Most the respondents indicated that the entrepreneurship training was appropriate but it was offered in major cities which were
out of reach for many SMEs that were not based in these cities. Finally, the respondents
indicated that the costs relating to the training were also very high.
The study concludes that although it is the role of the government to create an enabling
environment for the growth and development of SME’s, there is a need for the private
the sector to also play its role in aiding the government in creating this environment.