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Exciting strategy boost for Eastern Cape SMMEs

Nov 28, 2016
Exciting strategy boost for Eastern Cape SMMEs

The Eastern Cape Department of Economic Development, Environmental Affairs and Tourism (DEDEAT) is sharing details of its much-awaited five-year small business development strategy, following this year’s Global Entrepreneurship Week, which was held earlier this month.

MEC for DEDEAT, Sakhumzi Somyo, who is to deliver the provincial medium expenditure term framework later this week, says the strategy will bring SMMEs into the mainstream of the provincial economy and contribute more meaningfully to growth and job creation.

According to Somyo, South Africa’s SMME sector contributes 97.5% of all business and generates 35% of the country’s gross domestic product (GDP). SMMEs account for 43% of the total value of salaries and wages, and employ 55% of all formal private sector employees.

“The new strategy will create a robust SMME support system that builds provincial competitiveness by stimulating entrepreneurship, especially amongst historically marginalised communities and individuals,” Somyo explains.

The strategy singles out five areas: improved business support, enhanced access to financial and non-financial support for rural enterprises, enhanced competitiveness in priority markets and industries, a richer culture of entrepreneurship and innovation, as well as a more developed understanding of SMME sectoral trends and performance through research and monitoring.

The strategy unpacks new developments such as the establishment of an Eastern Cape SMME Development Forum that will help streamline public and private sector-driven support programmes by rooting out duplication, fragmentation and poor integration across all spheres of provincial government.

The strategy also proposes district SMME forums, which will form part of district local economic development committees.  These will coordinate and strengthen SMME programmes and feed into integrated development plans.

A proposed Eastern Cape Enterprise Development Agency will provide a systemic approach to building the small business sector while proposed provincial one-stop shops will house service providers in convenient rural and urban locations.

A mentorship programme will provide further support.

The government also plans to stimulate new enterprises through an incubation programme in priority sectors like tourism, agro-processing, automotive, petrochemicals, green industries, and capital goods.

The introduction of new technological or management processes that enhance SMME productivity, is also of the strategy. Funding would be sourced through the Technology Innovation Agency.

Provincial government plans to conduct regular assessments of the impact of government regulations or policy on SMMEs.

An entrepreneurship programme to nurture entrepreneurial attitudes and skills from primary school to higher education is also planned. It will also target post-graduates and unemployed persons who want to be self-employed and wish to open a business.

An Eastern Cape small business index which will track the SMME sector and provide up-to-date and relevant information on SMME statistics and issues.