Programme Director
Distinguished guests
Representatives from our National departments
Representatives from the National Planning Commission
Business Leaders
Honourable Delegates and International Speakers
Thank you very much for this opportunity. I am honoured to be here this morning in an event that brings together key role players in our economy.
Ladies and Gentlemen, the decision to host this Enterprise Development Conference in Gauteng is an appropriate and timely one.
Without any shred of doubt, Gauteng remains the premier investment and trade destination in our country.The province continues to firmly establish itself as the engine of growth not only of South Africa but for the continent as well. Gauteng contributes approximately 34.5% to the national economy and a remarkable 7.7% to the GDP of the entire African continent.
From 2001 to 2011, Gauteng province grew at an average real economic growth rate of 4.6%, which is above the national average rate of 4% during the same period.
Distinguished guests
I am honoured to be here this morning to take you through some of the Gauteng Provincial Government’s initiatives to bolster the position and role of entrepreneurs in our economy.
As entrepreneurs located in Gauteng province, you occupy a special place in the national economic landscape. The magnitude of Gauteng’s economy presents incomparable opportunities for entrepreneurs operating within the geographic confines of this province. The size of our population means that entrepreneurs in Gauteng have the biggest market for selling their goods and services in the country.
The fact that Gauteng has over 4 million people in employment means that the buying power for Gauteng consumers is significantly higher than in other provinces. But with all these positive aspects, the reality is that our world today is characterized by deep-seated inequalities and the concentration of wealth in the hands of a few.
The current reality in Gauteng, as spelt out by Census 2011 results, is that despite our small geographic size, the province is now home to more than 12.3 million people; a figure that has risen by 33.7% from a total of 7 million in 1996.This makes Gauteng the most populated province in South Africa, accounting for 23.7% of the total population.
Distinguished guests,
Among the pressing challenges we face, is the high unemployment rate, which is estimated at 25.6% in the province. Let me assure you that the onus to tackle the challenges we face as a country does not only fall on your shoulders as entrepreneurs.There is widespread recognition that local labour intensive industries are important levers in our vision to create employment and inclusively grow our economy.
One of the ways we intend to foster this economic inclusion is through a dedicated focus on manufacturing. The manufacturing sector is a cardinal element of our growth strategy and vision to create employment, reduce inequality and alleviate poverty.
In Gauteng alone, manufacturing employs approximately 600 000 people are employed in more than 9 000 enterprises. Despite this importance, the sector is currently undergoing an extremely difficult period, characterised by job losses and stiff competition from cheap and at times illegal imports.
Ladies and gentlemen,
I am certain that you are quite curious as to how government is responding to the challenges presented by this difficult period. The answer lies in among other things, public procurement, which makes a significant contribution to the development of growing enterprises that are able to participate competitively in the global economy.Different provincial departments are actively involved in stimulating economic activity by directly sourcing products from small businesses, particularly those owned by women and young people. Through the Gauteng Strategic Procurement Framework we seek to change procurement practices within Gauteng provincial departments and public entities to achieve the following:
- The employment, reduction of poverty and the stimulation of aggregate demand for goods and services;
- The creation of green jobs to encourage the use of sustainable and environment-friendly sources of energy; and
- The promotion of cooperatives, Small Medium Micro Enterprises (SMME) and Broad Based Black Economic Empowerment (BBBEE)
- Encouraging strategic relationships to drive the localisation agenda and improve the competitiveness of locally based companies,
The Gauteng Provincial government acknowledges that public procurement can be utilized to achieve certain socio-economic objectives with significant outcomes in a variety of areas ranging from the revitalization of the manufacturing sector and industrial policy in the province, to social policy goals such as the promotion of economic inclusion.
Ladies and gentlemen,
The logic that small businesses are vital for economic recovery is a compelling one. In some countries across the globe, small and medium sized businesses still face hurdles in accessing new markets; finance for start-up, growth and expansion; government regulatory environment as well as challenges in skills development and training.
But from a policy and practical point of view, South Africa is a land of plenty for small business support programmes.Through a variety of programmes and initiatives, the South African government plays a vital role in nurturing and supporting enterprises, as well as dedicating the necessary resources to ensure that small businesses flourish and prosper.
We are committed to multiplying efforts to grow and support small businesses and cooperatives. We believe that this is vital for overcoming the challenges presented by unemployment, a growing population and rising demand for services in Gauteng.
As part of our commitment to small businesses, the Gauteng Enterprise Propeller (GEP) an agency of the Gauteng Department of Economic Development provides a range of support programmes to small businesses and cooperatives.The entity also provides financial support to a many small businesses in construction, wholesale and retail, agriculture, ICT, automotive and manufacturing sectors.
This financial assistance is a lifeline to small businesses in the province, especially given the hurdles that they encounter in accessing funding from private financial institutions.You will also be pleased to learn that we also provide incubation to small businesses engaged in various sectors, including the automotive and technology sectors. This not only guarantees skills transfer to small businesses but also facilitates market access.
We have also assisted many small businesses across our townships. This project provides meaningful business support to township businesses.
Programme director,
I must note that sometimes, small businesses fail to take advantage of these programmes due to lack of information about what these projects are. How they work? Who qualifies to use them? What procedures are to be followed to get assistance? And how to contact the institutions implementing these programmes?
In this regard, a programme will be developed to ensure the visibility of our development finance institutions through exhibitions and trade expos. This platform is therefore very important for the dissemination of information so that small businesses are empowered with an understanding of the different mandates of our development finance institutions in order to make maximum use of the opportunities offered.
Programme director,
I must note that even this support is inadequate in ensuring the maximum and optimal performance of the small business sector in Gauteng. Direct linkages with big businesses are important for the survival of this sector, more so during this testing economic period.
Tabling the Budget Vote for the Department of Trade and Industry earlier this year, Minister Rob Davies’ emphasised that there is a compelling need to encourage enterprise development and to ensure that big business plays a role in developing a viable supplier base that will be able to grab the opportunities presented by both domestic and international markets.
Programme director,
We are singing from the same hymnbook as Minister Davies on this issue. As a demonstration of this, we have recently signed a cooperative agreement with the United Nations Development Programme aimed at forging supplier linkages between big corporations and small businesses.
This partnership has the potential to transform the way big and small businesses relate and work together. It makes provision for the setting up of a permanent unit that will bring together a team of specialists in the Supplier Development Programme, with the objective of focusing on priority economic sectors of the province.
In piloting this project, we will also adopt lessons from countries like Mexico, Honduras and El Salvador to tailor-make a programme that addresses the specific local dynamics of this province.
Ladies and gentlemen,
This programme spells good news for small and medium enterprises in Gauteng and should be celebrated by all. By forging these linkages, small businesses will gain training with a focus on producing to meet big company standards as well as sustaining and expanding their participation in local and foreign markets.
Programme director,
Behind most successful economies is a symbiotic relationship between government and business big and small. We are willing to travel the extra mile to foster a thriving entrepreneurial culture by strengthening education and training, facilitating market access for small businesses as well as encouraging supplier development through public procurement and partnerships with big business. We look upon platforms such as the one provided by this conference for sincere and mutually beneficial partnerships and collaboration.
Thank you for listening.
