SA News | 25 March 2023
Government remains committed to supporting the black-owned business sector in their efforts to rebuild their businesses following the economic downturn, said Deputy President Paul Mashatile.
“As government, we remain committed to supporting the black-owned business sector, in their efforts to rebuild their businesses after the economic downturn. We have begun to have important conversations about how people in the informal economy can get the most out of what our economy has to offer,” said the Deputy President.
Delivering the keynote address at the Black Business Quarterly (BBQ) Awards ceremony, held at Emperors Palace in Kempton Park, Gauteng on Friday, the Deputy President spoke of the devastating and disruptive effects of load-shedding on the economy and the small business sector. This he said remains “a major concern for all of us”.
“Load-shedding has cut business hours and production capacity, with the consequent result of reduced income. Businesses have also had to spend large amounts towards finding alternative energy sources to keep their operations viable.
“Consequently, this has resulted in significant losses in jobs between the years 2019 and 2021, both in the formal and informal sectors. Nevertheless, the South African economy grew slightly for the second year in a row, expanding by at least 2.0 percent between the years 2021 and 2022, which represented an increase from 4,50 trillion Rands to 4,60 trillion Rands."
The Deputy President also noted that the increase in the number of unemployed South Africans, particularly among the youth, necessitates more immediate steps to assist government in fundamentally altering the country’s economic growth trajectory.
“As the sixth administration of government draws to a close, we must be truthful with ourselves. We must have an open and inclusive conversation about rebuilding that which will result in increased economic activity.
“We must acknowledge that there is a greater and more pressing need to support aggressive means and forms of economic integration for black-owned firms, particularly in the historically untransformed sectors of the economy.
“Furthermore, in order to give various economic issues urgency, including the evaluation of how we may reinforce policies that are focused on economic emancipation, it is necessary to look at the agenda of the governing party. We must pay close attention to how government at all levels, can create a supportive policy and regulatory environment that in turn supports the informal economy,” said the Deputy President.
He spoke of the need to improve the state's overall capacity to expedite the processing of applications and approvals, in order to integrate the commercial and economic operations of unorganised players in the informal economy into the mainstream sector.
“As such, it cannot be business as usual, when businesses, especially, black-owned enterprises, continue to experience the harshest types of hardship and depression as a result of a system that is unresponsive to their needs.
“This includes the need to resolve the ongoing challenges of government’s non-payment and settlement of invoices due to small businesses within regulated time frames. The National Treasury requires that invoices for these critical service providers be paid and settled within 30 days.”
He added that government is committed to implementing consequence management for departments and state agencies that fail to implement these requirements.
“We recognise that late payment after services have been rendered has significant repercussions for your businesses' finances.”
Youth and job creation
The Deputy President said government is also committed to creating more sustainable jobs, particularly for the youth.
He highlighted that during the 2021/2022 financial year, the National Youth Development Agency (NYDA) Grant Programme provided more than 2000 youth-owned enterprises in rural and township economies with grant funds to launch their firms.
“Moreover, supported by the National Youth Development Agency funding programme and the Youth Micro Business Relief Fund, youth-owned firms have created and maintained employment of 8,600 employees in the economy. Yet, these are by no means sufficient.
“We need to grow these efforts further by scaling up on investments to build skills. On our side as government, we need to sharpen our role in coordinating, facilitating, as well as unlocking opportunities for people who wish to expand their local businesses,” he said.
‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’.