top of page

THE

BEECHAMBER

Asset 4.png

NEWS

MICROSOFT INJECTS R1.3BN INTO SA ECONOMY IN BEE DEAL

Simnikiwe Mzekandaba | 22 May 2024


Some 200 small, micro and medium enterprises (SMMEs) and over 2 000 individuals will be equipped with advanced artificial intelligence (AI) knowledge and other capabilities to prepare them for jobs of the future.


This is one of the facets of a R1.3 billion investment agreement entered into between software giant Microsoft SA and the Department of Trade, Industry and Competition (DTIC).


Microsoft SA and the department yesterday inked the agreement, to be deployed over the next 10 years in the development of black-owned SMMEs in tech and non-tech sectors. The financial value of the commitment is calculated on the company’s estimated turnover over the next 10 years.


The investment, says the DTIC, is facilitated under the Equity Equivalent Investment Programme provisions of the B-BBEE Act. It is designed to provide organisations such as Microsoft, which are not able to facilitate local ownership in their firms, with an avenue to accrue BEE points.


According to Microsoft SA, the investment commitment aims to spur SMME development, create local opportunities and ready the country for AI transformation.

Speaking ahead of the signing ceremony, Microsoft SA MD Kalane Rampai emphasised that “AI is here”.


“Last year, we were talking about AI as a breakthrough technology. This year, if you are not using AI, you are already behind.


“We cannot downplay the role that AI is currently playing and will continue to play in future. Therefore, there is no doubt that technology is altering the way we work, how we work and the job itself – we need to make sure our people have the requisite skills to stay relevant.


“We believe there is a massive opportunity for those willing to skill up on AI. At the same time, organisations that empower employees with AI tools and training will attract the best talent.”


Lillian Barnard, president of Microsoft Africa, added: “This investment represents our commitment to empowering individuals and small businesses to be part of Africa’s digital economy, and drive job creation and growth that will benefit the entire region.”

SA’s SMMEs have been identified as engines for job creation and increasing economic activity in the country.


Rampai noted that with the number of local SMMEs increasing by 6% year-on-year, there is impetus to make sure they are sustainable and geared for growth.


Resultantly, the investment will focus on enabling SMMEs to grow, providing them access to new markets and making sure they become net job creators, he stated.

“The investment aims to provide a platform for SMME development founded on technology, digital transformation, as well as market opportunities.


“As Microsoft, we believe SMMEs can contribute significantly to developing our digital economy and the wider economic growth of Africa.”


In addition to skills development, the investment will ensure the digital transformation of up to 42 SMMEs and start-ups, alignment with 18 TVET colleges to use technology to prepare students with future-ready skills and enhance employability, and supporting up to 20 advanced research and development projects.


DTIC minister Ebrahim Patel said the establishment of the investment deal comes amid rapid technological change.


“There is hardly a part of the economy and society that is not being enriched and reshaped by technology. This trend has not reached its end; it is part of humanity’s grapple with the changes brought about by technology.


“The fund [investment] will assist black South Africans in non-tech sectors to harness the power of technology, and improve their competitiveness and ability to innovate and expand their operations.


“It will also act as a bridge to enable young people to get training, certification and job placement, so that talented South Africans gain access to the opportunities that arise from an increasingly digitalised world.”


The DTIC said the investment commitment will be allocated as follows:

  • An enterprise development initiative, estimated at R663 million, will focus on technology start-ups owned and operated by black South African entrepreneurs and development of new solutions in disruptive technologies. Another portion of the initiative will focus on non-technology companies, encouraging greater use of technologies like machine learning and other forms of AI by black-owned SMEs.

  • A skills development initiative, estimated at R347 million, will focus on providing intensive training to young black South Africans through certification courses and learnerships.

  • The R&D initiative, estimated at R160 million, will invest in research programmes. This includes a R50 million investment, which will be spent in consultation with the Localisation Support Fund to introduce emerging technologies into industrialisation and localisation initiatives.


‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’.


Comments


bottom of page