Address by the Deputy Minister in The Presidency, Mr Buti Manamela to the Step Up to a Start Up Awards Ceremony, 3M Offices, Sandton
Programme Director
Minister of Small Business Development – Ms Lindiwe Zulu
Premiere of Gauteng – Mr David Makhura
Deputy Minister of Social Development – Ms Henrietta Bogopane Zulu
Chairperson of the National Youth Development Agency (NYDA) – Mr Yershen Pillay
CEO of Proudly South Africa – Adv. Leslie Sedibe
CEO of Regenesys Business School – Mr Siegie Brownlee
Managing Director of Primestars Marketing – Mr Martin Sweet
Participants of the Step Up to a Start Up Project
Distinguished guests
I am honoured to participate in this Awards Ceremony for the Step Up to a Start Up project. Primestars Marketing has brought innovative, cutting edge youth development programmes to our young people.
From My Future My Career, to Smartbucks Mind your Moolah, to Step Up Lets Lead, these programmes have reached over 208,000 young men and women with a blend of education and entertainment. The Ster Kinekor cinemas have been turned into “Education Theatres of Learning”. And of course, not to forget that all this comes with a free popcorn and cold drink.
In developing the National Youth Policy 2020 we consulted with young people extensively. At these nation-wide consultations, young people told us that they are tired of being labelled as apathetic and lazy with a sense of entitlement. They told us that they are not a threat to be managed but instead they are a resource to be nurtured. Young people told us that they want a hand up and not a hand out.
South Africa has low rates of youth entrepreneurship particularly when we are compared to our BRICS counterparts and other middle income developing countries. Too few young South Africans see entrepreneurship as a viable career choice.
According to the Global Entrepreneurship Monitor 2013 Annual Report, only 13% of South Africans intend to open a business in the next 3 years. This is well below the Sub-Saharan Africa rate of 47%.
In South Africa, early stage entrepreneurial activity rose from 7% in 2012 to 10.6% in 2013. This is far below the average of 26.6% in Sub-Saharan Africa being 26.6%. As a country we need to do more to stimulate youth entrepreneurship, particularly encouraging young people who have never tried entrepreneurship to do so. And in that process we will give young people a hand up.
The National Youth Policy 2020 will drive a massive youth entrepreneurship training programme. We need more young entrepreneurs. Entrepreneurship and small businesses are a mechanism to draw new entrants into the economy, strengthen inclusive growth, build the social economy, encourage solidarity and create large numbers of jobs.
In our conversations with young people we have learnt that many young people view entrepreneurship as too risky an adventure.
They fear that if they fail they will end up with massive debt at a young age. They will end up with a negative credit record that will follow them as they transit into adulthood. This will likely affect their employability, their ability to buy a house or access credit to buy a car or to even pay lobola.
Taking these concerns into account, the NYDA introduced the Grant Programme with the aim of stimulating entrepreneurship by getting young people to take a bite at it. The grant is just that, a grant. The grant ranges from R1,000 to R100,000. They do not have to pay it back. If they don’t succeed, and of course we want them to succeed, they will not have massive debt or a negative credit record. So the programme helps to mitigate risk on behalf of the young person. They can use the grant to establish their business, develop a track record and use this track record to access further business funding to grow their businesses. The grant is coupled with other business development support services.
The evidence has shown us that building a pipeline of entrepreneurs is important at all stages, from start-up, to small business development and to growth. This pipeline must have the necessary business development supports along the way demonstrating the necessary sophistication as young people start and grow their businesses.
We have always argued that youth development must be mainstreamed. That young people cannot operate in some corner on the periphery of the economy. No, they must be part and parcel of the mainstream economy, contributing to it, growing it, paying their taxes, employing others and demonstrating their good citizenship.
I am excited to hear that many companies have stepped up to support this initiative. We have always contended that if we are going to make a serious impact on youth unemployment, government resources alone will not be enough. We will need the resources, in all forms, from the private sector. I commend the companies involved with the Step Up to a Start Up initiative.
Thank you for your investment in youth development. We need more and I further encourage you to do more. After all, youth development is everybody’s business.
It is our hope that Primestars Marketing will continue to provide these forward-looking programmes to our youth. As government, through our departments and agencies, we will continue to support these efforts where possible. This is a good model of private and public cooperation.
To the young people who will be receiving awards tonight: May your smiles beam across your face as you Step Up to receive your award and as you Step Up to being a successful entrepreneur in South Africa. As you celebrate your achievement, show your peers that entrepreneurship is possible. Congratulations to you and continue to make us proud.
I thank you.
