More needs to be done for SMMEs says Thabethe

"As we take stock of progress made so far, we acknowledge that there has been some progress, especially on policy and development of support infrastructure for SMMEs.

"We do, however, still need to encourage further development and growth of SMMEs and co-operatives as a vehicle for job creation and economic development of the country," said Thabethe on Wednesday (10 October).

She was speaking on the first day of the two-day annual small business summit.

The Department of Trade and Industry (dti), she said, had amended the Co-operatives Act, where there is provision for the establishment of the Co-operatives Agency, Co-operatives Tribunal and the Co-operatives Academy for training.

"The apartheid legacy had resulted in the dislocation of township and rural businesses, which has affected the development and growth of businesses in townships," she says.

"There has, however, been an increase in the number of businesses entering the market, as well as an increase in entrepreneurship at around 9.1% in 2010, although this was below the recognised standard of 11.5% a year," she added.

She pointed out that in 2010/11, the department conducted a review of government SMME support measures with the intention of taking stock of interventions in this sector by government. "The review proposed several interventions chief of which was market access for SMMEs," Thabethe said..

"There is also a need to re-look at and resuscitate the old industrial parks and business hives to provide suitable business infrastructure for small businesses," Thabethe told delegates.

Progress made in addressing economic challenges

The director-general of the dti Lionel October progress had been made in addressing the scope and scale of economic challenges.
"I think everyone will agree that the central challenge that we face as a country is the issue of unemployment," said October, adding that the country's unemployment rate was stuck at about 25%.

"It's not to say that nothing has happened in this country. Firstly in 1994, this economy had under 9.5m jobs. Currently, we're sitting at around 13.5m jobs indicating that we had created 4m new jobs," said October.

"The economic is growing at just over 2% but given the age of our population we must grow at about 6%," he said.

The agricultural sector, said October, could contribute to resolving the problem among the youth. "Other governments around the world had given much support to the agricultural and sector," said October. "We must build up that sector."

He said that at the last Cabinet Lekgotla, government decided to prioritise the agricultural section and will introduce a R1.2bn incentive to support it.

"The incentive will be for small farmers to supply big business with products," he added.

The summit is taking place in White River in the Mpumalanga, one of the three fastest growing provinces in the country.

MEC for the Department of Economic Development in Mpumalanga, Yvonne Phosa, said the provincial unemployment rate in the second quarter of 2013 stood at 29.4%. The province has a youth unemployment rate of 43%.

"The figure indicates that there's a sizeable task ahead of fighting poverty, unemployment and inequality. Efforts need to be biased to the youth," said Phosa.

Thabethe also raised concern over the practice of South Africans renting out their businesses to foreigners.

"This scourge, which has been a sad one for us, is that of South Africans in townships sell or rent their businesses to foreigners. It does not assist us as government in our efforts to support the informal sector," she added.