By OBAKENG MAJE

Most Small Micro-Medium Enterprises (SMMEs) in North West are grappling with financial challenges. Now, the South African National Civic Organisation (SANCO) in the province, calls for prioritization of SMMEs and Cooperative empowerment.

SANCO provincial spokesperson, Palesa Zizi said the SMMEs and Cooperatives are acknowledged worldwide for their pivotal role in promoting inclusive socio-economic development, however, they are faced with significant challenges in the province.

Zizi said despite being recognised as the backbone of the economy, contributing to reducing unemployment, alleviating poverty and bridging socio-economic inequalities, they also act as catalysts for innovation, technology and trade, driving the demand for goods and services.

“Access to funding and markets remains a considerable challenge aggravated by stringent criteria imposed by corporate banks and Development Finance Institutions (DFIs). Regrettably, government institutions such as the Department of Economic Development, Environment, Conservation, and Tourism (DEDECT) along with municipalities, do not accord these entities the priority they deserve.

“SANCO in its own assessment of the support programmes for SMMEs and Cooperatives, notes with serious concern that the province is not prioritising these enterprises. The Empowerment Fund, as one of the support programmes aimed at supporting the North West- based enterprises with machinery and equipment from DEDECT is falling short of its objectives,” she said.

Zizi further said the last advertisement or a call for Empowerment Fund applications made by DEDECT was in 2021. She added that, according to the DEDECT’s annual report for 2021/22, the department’s actual achievement for the number of businesses provided with production equipment is 15 out of a target of 50 and an allocation of R15 000 000 set aside for this support programme in the budget speech.

“According to the DEDECT budget speech and annual report 2022/23, the department funded a mere 39 enterprises with production equipment out of 115 approved applications from a total of 750 applications received. This means that, in the 2 previous financial years, the department has only managed to assist 54 enterprises with production equipment.

“We wonder what is difficult about buying this much-needed production equipment because the department has an allocated budget for this programme. This very department in its budget speech for 2023/24 has budgeted R15 000 000 for the procurement of equipment for start-up as well as growth and expansion of small business enterprises to contribute to job creation and poverty alleviation,” said Zizi.

She said they wonder how many they have funded thus far and will be able to fund at the end of this financial year. Zizi said analysis in terms of the DEDECT empowerment fund is that, each financial year, a budget of about R15 000 000 is set aside, but the number of enterprises assisted cannot even amount to a quarter of the budget allocation, meaning the chunk of this money goes back to the Treasury Department.

“Notably, the national Department of Small Business Development (DSBD) has demonstrated to be more serious about small business development, procuring and handing over business equipment and machinery to 68 informal traders in the Moretele and 59 in Mahikeng.

“This is a total of 127, thus far for the North West this year, thereby contrasting with DEDECT’s limited impact. What is more surprising is that, the DSBD has not only procured and handed over this equipment to traders in the North West, but also reached out to all nine provinces,” she said.

Zizi said the DEDECT focusing only on the North West province and with a budget of R15 000 000, is unable to procure and hand over equipment to a mere 100 enterprises (25 per district) in the whole financial year.

She said the North West Development Corporation (NWDC) was designed to be the implementing agency of DEDECT and a leading development agency in the province, however, it has proven to be ineffective as it is struggling with basic property maintenance and payments of electricity and probably water.

“The agency is probably the weakest development agency in the country, for we are not even sure how it is progressing with its Special Economic Zone (SEZ) programme. North West Premier, Bushy Maape during Office of the Premier’s Provincial Budget Vote 2022/23, outlined plans which he said are at an advanced level to appoint various expert panels to conduct thorough assessments and alignment of national and provincial policy priorities in the critical performance areas.

“The assessment is supposed to review the performance, relevance, sustainability, retention and/or release of State-Owned Entities, the review of the Provincial Growth & Development Strategy and the design, planning and implementation of key strategic mega infrastructure projects,” said Zizi.

She said they are still eagerly awaiting the premier’s report with expectations that interventions will also revitalize the struggling NWDC, which we expect amongst other things to drive a radical tuck- shop revitalisation programme, aiming to ensure through the necessary support, the tuck-shop industry is being returned to South Africans.

Zizi said the challenges faced by SMMEs extend beyond financial support with exclusion from the planning and development of malls and shopping complexes exacerbating their struggle for market access and yet expected to grow and contribute towards job creation and poverty alleviation. She said SANCO emphasizes the need for authorities to impose conditions ensuring low-rent spaces for SMMEs in all economic developments and infrastructural projects like malls and shopping complexes.

“South Africa’s legislation, including the Immigration Act, the Business Act and municipal by-laws also disadvantage small businesses, the majority of which are run by black communities by allowing asylum seekers and refugees to participate in small economic spaces such as the spaza, tuck-shops and saloon, which in our view should be reserved for the citizens.

“SANCO calls for a reconsideration of these regulations, advocating for the prioritization of citizens in these small economic spaces as is the case with the Liquor Act. SANCO in North West strongly asserts that the growth and sustainability of small businesses are not receiving the attention they deserve and calls for urgent intervention, emphasizing the need for the government to fulfil its promises and prioritize the growth and sustainability of SMMEs and Cooperatives” she said.

Zizi said furthermore, SANCO calls for the establishment of an integrated database system to track funded enterprises, preventing multiple benefits and identifying collapsed ventures. She said organisation amongst other things believes that, implementation of the District Development Model (DDM) in the province must be reviewed to ensure it aligns with the intended outcomes of improved government planning and impactful service delivery.

taungdailynews@gmail.com