Micro, small, and medium sized businesses (also known as mipymes) have turned into the one of the strongest arms of the Honduran economy according to data from the Secretary of Economic Development (SDE). Nationwide there are between 550,000 and 700,000 mipymes which generate some 70% of the jobs which currently exist within the private sector, which translates to more than half a million jobs according to German Perez Destephen a representative of the National Industrial Association (ANDI).
More than 40% of these businesses are located in the urban areas of the country and 60% are located in the rural areas of the country, with the heaviest concentrations being (rather unsurprisingly) in Tegucigalpa and San Pedro Sula, according to Perez Destephen. “The majority of businesses in the mipymes section operate commercially including hotels and restaurants.” This group represents some 66% of all of the mipymes with the next section being manufacturers who make up 25% of all mipymes and the remaining 9% being made up of various businesses and business types.
According to bulletin study of marketplace labor of 2016 from the Honduran Council On Private Business (Cohep) there are some 370,000 people who generate revenue themselves and that number is growing.
Pedro Barquero, an executive director of the chamber of commerce and industry of Cortes (CCIC) explained that in the last few years there’s been an explosion of new businesses and ideas which eventually became mipymes, and that this has been caused in part by a former lack of space for young people who are now turning into an economically active population. “The lack of employment caused many young people and many older people as well to create their own businesses to employ themselves. That’s why it’s important to create ideal conditions for them to develop their business ideas and guide them into becoming sustainable and functioning business models.” Says Barquero. He also says it’s necessary to ope the windows of the market so that businesspeople can sell their goods openly and freely, not to mention the need to give young people business loans to finance their businesses, and advice on how to prepare and form their businesses.
Mario Kafati, vice-minister of the Micro, Small, and Medium Business and Social Sector of the Economy agencies of the SDE has talked about the importance of this sector saying: “Mipymes generate a significant part of the gross domestic product of the country and that’s why it’s critical that we support this sector. We’ve developed programs and made funds available for financing these small businesses so that they can one day become big businesses.” Says Kafati.
Forming A Business:
One of the biggest challenges for this segment of the businesses in Honduras is managing to successfully form and formally come into existence.
According to representatives of the National Association of Medium and Small Businesses in Honduras (ANMPIH) only 20% of mipymes are formal businesses with 80% operating clandestinely. That isn’t stopping efforts to reverse these statistics, and Esperanza Escobar (President of ANMPIH) has worked tirelessly to help create Centers Of Business Development (CDE-Mipyme) and are now located throughout the country. Esperanza is still working to strengthen this sector through consulting, workshops, and permanent coaching. “One of the biggest difficulties for these small businesses is the administrative parts of owning a business. Many manage to open their businesses but they can’t keep them afloat due to a lack of administrative and financial discipline.” Says the president. Her efforts with the support of the CDE-Mipymes and promoted by the Economic Development Secretary as well as the support of influential actors within the private sector have managed to help keep many businesses alive and to develop many new businesses as well.
The President Of Cohep:
Luis Larach, president of Cohep has said that it’s crucial that mipymes move to get the regulations of “monotributo” approved and that the processes to register as a business get simplified, which currently are very tedious which is a significant obstacle for many small businesses. Luis stated that many mipymes close due to high costs and lengthy processes which are currently necessary to obtain the permits and licenses needed to operate formally. “Various administrations have created a complex administrative system which has resulted in the deaths of numerous mipymes. We cannot ignore the progress we’ve made so far to lift this sector up but there is much to do.” Says Larach.
The source for this article is a La Prensa article published just an hour ago.