Speaking at the two-day National Co-operatives Conference, which kicked off in Johannesburg yesterday, Mandisi Mpahlwa said the DTI would make a number of options available to help facilitate the creation of co-operatives.
“Our approach is to try and make the business and social environment in South Africa more conducive for the development of co-operatives and other enterprises in the second economy,” Mpahlwa said.
“In developed countries we see examples of highly-successful co-operative grocery stores, marketing co-operatives, buying co-operatives, financial co-operatives and producer co-operatives. Co-operatives clearly offer a viable form of enterprise in any economic system and are not, as some might argue, a form of enterprise that comes exclusively out of socialist economies.”
He said that the DTI is aware of the many challenges confronting co-operative enterprises and envisages that the department's policies will create a business-enabling environment where co-operatives can thrive.
“The co-operatives model is ideal for unlocking entrepreneurship more especially in the rural areas and across the economy, due to its double strength of having a social and economic approach,” Mpahlwa said.
“Our support to this alternative form of enterprises will also be an important way to facilitate the integration of the second economy into the first economy. This integration is a crucial aspect of the government's vision 2014, which is to create a single economy in our country.”
Apart from the policy and legislative issues surrounding the development of a thriving co-operatives sector in South Africa, the DTI has established a co-operatives unit to look at the implementation issues.
This unit is reportedly implementing an education campaign, forming partnerships and lobbying organisations.
The unit has also been given the mandate to elicit support from commercial banks and other key private sector service providers, so that they are more supportive of co-operative enterprises and are prepared to finance and service them, the minister said.
“This will involve a great deal of hard work and the DTI is prepared to allocate additional resources to this area as the need arises,” he said.
The department is also currently developing appropriate offerings to provide institutional and financial support for the development of co-operatives.
Mpahlwa said that these offerings, while not yet finalised, will take the form of technical capacity building and will possibly include an incentive to assist start-ups.
“We envisage that this incentive programme and support measures will be aimed at building and assisting enterprises to mobilise savings, accumulate assets, and raise the initial working capital required, which will be easier as a collective rather than as individuals,” he said.
Co-operatives were first identified as important creators and developers of jobs, as well as a means for increasing the participation of previously-disadvantaged individuals in the economy, at the 2003 Growth and Development Summit.
The conference coincides with public hearings on the Co-operatives Development Bill, which begin in Parliament, in Cape Town, today. This will enable all stakeholders will get an opportunity to express their views and make their input on the bill before it is passed into an act.