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Dhaka, July 10 (UNB) –A six-year project worth €19 million (Tk190 crore), financed by the European Union (EU), was launched, aiming to improve the competitiveness of Small and Medium Enterprises (SMEs) in local and international markets.

The European Union (EU) and the Industries Ministry formally launched the project titled ‘Bangladesh INSPIRED (Integrated Support to Poverty Reduction and Inequality through Enterprises) at the city’s Radisson Hotel in the afternoon.

Industries Minister Dilip Barua attended the ceremony as chief guest while Ambassador William Hanna, head of the delegation of European Union in Bangladesh, was the special guest. Industries secretary KH Masud Siddique presided.

The project will be managed by the Ministry of Industries in partnership with Bangladesh Bank. The Bangladesh Institute of Bank Management and Bangladesh Bank Training Academy will provide training to bankers on improved financial products and services for SMEs.

The Business Intermediary Organizations (BIOs) such as trade associations or chambers of commerce will benefit from the grant scheme of €6.5 million (Tk.65 crore) intended to help improve services for their members and develop enterprise clusters in eight sectors –agro-processing, natural fibres, electronics, plastics, light engineering, furniture, textile and leather.

Speaking at the inaugural function, Dilip Barua said SMEs constitute 90 percent of the private sector enterprises and some 70-80 percent of the non-agricultural workforce.

He also said the SME Sector contributed up to 25 percent of Bangladesh’s gross domestic product last year, about 40 percent of gross manufacturing output, and accounted for around 25 percent of the total labour force in Bangladesh.

Barua noted that this project would help Bangladesh in the long run to sustain economic growth apart from increasing the capacity of the government organs related to SMEs. It would promote a congenial atmosphere for the nurture of SMEs in Bangladesh, the minister hoped.

He said the EU-supported project would help address the most common problems of SME entrepreneurs regarding access to finance.

Addressing the function, Ambassador William Hanna said the SMEs have been playing an important role in increasing diversity and competitiveness of Bangladeshi products in the global markets. “SMEs are vital factors for Bangladesh….it’s playing a crucial role in reducing poverty,” he said.

A B M Khorshed Alam, project director and Additional secretary to the Ministry of Industries and SME Entrepreneurs were also present.