SMMEs are crucial to job creation
Without them economy can’t grow, says CR
PRESIDENT Cyril Ramaphosa has warned that the battle to address unemployment and low-economic growth will not succeed without the backing of small and medium enterprises (SMMEs) through investment and business opportunities.
He was addressing the SMME programme in Soweto, Johannesburg, which is part of the second annual SA Investment Conference.
The conference was launched by Ramaphosa last year as part of boosting the country’s economy and job creation. The inaugural event attracted R300 billion of the targeted R1.2 trillion for the next five years.
This year’s investment commitments attracted R363bn in total investment commitments.
Ramaphosa said the government was finalising details of the Township Entrepreneurship Fund, which he announced last year aimed at stimulating the township economy.
“Small businesses provide goods and services and are vital drivers of economic activity. They also provide employment opportunities and sources of livelihood to hundreds of thousands of people who, for a variety of reasons, have slipped through the employment net. With the local and global economy under pressure, it is small enterprises that present the greatest potential,” he said.
He added that despite SMMEs being fundamental to the growth of the economy, they were however overlooked when it came to government planning and investment.
“As we conclude the second South Africa Investment Conference, and forge ahead with plans to raise R1.2 trillion in new domestic and foreign investment over five years, we must consider how to better showcase the investment potential of our SMMEs,” he said.
Ramaphosa said the soon to be finalised Public Procurement Bill would also compel all state departments to sub-contract SMMEs to a minimum of 30% of the value of their contracts, if they are above R30 million.
“Whoever receives a tender must sub-contract a minimum of 30% of the value of the contract to SMMEs that are at least 51% black-owned. The government will strengthen monitoring and compliance through the Office of the Chief Procurement Officer,” he said.
According to Ramaphosa, some of the billions of rand pledged by investors would have to go to SMMEs through procurement.
“We would like to issue a call to our friends from the global investor community to support SMMEs when it comes to procuring goods and services as part of the projects that will result from the commitments made at the conference,” he said.
In concluding the conference, Ramaphosa said the success of his investment drive was equal to the task of “moving a mountain”.