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Budding small business department aims to set up provincial entrepreneurship hubs

Small Business Development Minister Lindiwe Zulu

Small Business Development Minister Lindiwe Zulu

Photo by Duane Daws

23rd July 2014

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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Acknowledging that the newly formed Department of Small Business Development (DSBD) remained in the “process of configuration”, Small Business Development Minister Lindiwe Zulu assured Parliament on Tuesday that the department remained conscious of the need to establish itself  “with high speed”, emphasising that small, medium-sized and microenterprises (SMMEs) and cooperatives could not afford vacuums “of any sort”.

“Within this context, we have been mindful of the end-user and have considered business continuity as a principle of which recipients will continue to benefit while we configure our department,” she stated during her Budget Vote speech.

She noted that the budding department, guided by this understanding, would focus on enhancing policy, the regulatory environment and localisation for the benefit of SMMEs, as well as leverage public procurement, financial and nonfinancial support, human capital, skills development and competitiveness.

It further aimed to provide extensive support to small businesses and cooperatives, and increase support through consolidated public agencies, enterprise coaching, mentorship, incubation and intensive support programmes.

“This will be achieved through enhanced coordination and transversal agreements with government entities and State-owned enterprises, while ensuring measurable accountability of State institutions in support of SMMEs and cooperatives.

“A coordinated effort is important as we believe the work around SMMEs and cooperatives cuts across almost all government departments,” she explained.

PRIORITY AREAS
Outlining the department’s ambitions for the year ahead, Zulu noted that the DSBD would look to intensify the active participation of SMMEs and cooperatives in the priority sectors as identified in the National Development Plan, the Industrial Policy Action Plan and the New Growth Path, as well as the priority areas for public procurement.

It would further encourage entrepreneurship through the establishment of Centres for Entrepreneurship in all nine provinces, as well as the establishment of Small Enterprise Development Agency (Seda) Technology Programmes and Incubation Support Programmes across the country.

“As a department, we will also drive increased and expanded demand for goods and services produced by small businesses and cooperatives, while implementing programmes to enhance secondary cooperatives for inclusion into value chains.

“This will involve the implementation of national informal business uplifment support programmes and will see us collaborating with the Department of Trade and Industry (DTI) on the implementation of export villages,” she commented.

DTI INTERVENTIONS
Further elaborating on early SMME industry successes, Zulu noted that, through its Incubation Support Programme, the DTI had, to date, approved funding of some R590-million to support 39 incubations focusing on agriculture, services and the manufacturing sector.

In addition, the Seda Technology Programme had, thus far, created 291 new SMME entrants, supported 1 227 existing SMMEs and created 1 258 employment opportunities.

“Some 28 projects were approved through the Support Programme for Industrial Innovation (SPII) amounting to R76-million with beneficiaries from Gauteng, the Western Cape and Kwazulu-Natal. Areas of focus include the green economy, information and communication technology, energy, manufacturing, as well as manufacturing,” she noted.

Zulu added that the review of and amendment to the Cooperatives Act and National Cooperatives Strategy had been completed, allowing for the establishment of new institutional arrangements, such as the Cooperatives Development Agency and Cooperatives Tribunal.

“A total of 243 projects amounting to R62-million were funded through the Cooperatives Incentive Scheme during the previous financial year, with 1 897 beneficiaries of which 990 were female, 253 youth, 25 with disabilities and 629 male,” she said.

The DSBD would, meanwhile, continue its collaboration with provincial entities to advance Cabinet’s 2007 decision calling for 85% local procurement of ten specified products and services.

Further, the DTI had approved the establishment of the Secondary Marketing Cooperatives, as well as an incentive amounting to R10-million per cooperative, to enhance value-add in respect of goods and services, increase the use of technology, as well as improve logistics and infrastructure.

“In addressing measures for a conducive environment, the DTI had also recently launched the National Informal Business Uplifment Support [programme], which will enhance enterprise development support and coordinate intergovernmental and stakeholder relations for broader participation of South Africa’s informal sector in the economy.

“In addition to this, the implementation of the Integrated SMME and Cooperatives Development will allow for harmonisation and co-locating opportunities in the informal sector,” noted Zulu.

Government had, meanwhile, launched Red Tape Reduction Measures for Municipalities in all nine provinces. These would allow for the reduction of red tape at local government level and also served as a local business environment monitoring mechanism.

During the course of the previous financial year, the DTI also approved a Youth Enterprise Development Strategy aimed at increasing the contribution of youth-owned enterprises to South Africa’s gross domestic product.

This strategy entailed direct support schemes for young entrepreneurs with the objective of creating and managing sustainable and efficient businesses capable of providing decent permanent jobs.

According to the DSBD, SMMEs contributed 57% of South Africa’s gross domestic product and accounted for 56% of employment.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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