Plan to empower township businesses
The Steve Tshwete Local Municipality in Mpumalanga has identified huge scope for small business growth in its own backyard.
|||Johannesburg - With estimates valuing South Africa’s township economy at about R100 billion, the Steve Tshwete Local Municipality in Mpumalanga has identified huge scope for small business growth in its own backyard, and wants small and medium-sized enterprises to rise to the challenge.
To prevent the lion’s share of this money leaving the township and ending up in the hands of those who already control the means of production, the municipality has embarked on a process to collect information on businesses that operate in the townships with the aim of establishing an industrial hub for small, medium and micro enterprises in Mhluzi Township.
The registration will focus on all areas of the Steve Tshwete municipality, but with special emphasis on Mhluzi. This will include all business types in the townships, ranging from mechanics to panelbeaters, brickmakers, welders, electricians, dressmakers, tailors, plumbers and manufacturers in general.
The municipality, in partnership with Anglo American, has identified land covering 2 hectares which will be developed into an industrial hub to house informal and emerging businesses in the townships to improve their competitiveness and growth into sustainable companies.
In order to create a credible database, the municipality has asked all small businesses to register by providing their contact details and their core service functions.
Businesses are being visited randomly until October 30.
The municipality believes it must get more small and medium-sized enterprises to participate in the value chain because as long as it is dominated by a few big companies they will not be able to change the structure of the local economy.
South Africa’s townships are relics of the country’s apartheid regime. The impact of past neglect, lack of investment, overpopulation and isolation from urban centres is still largely evident today.
Most notable is the lack of resources and infrastructure, as well as high unemployment levels.
World Bank group country director for South Africa, Asad Alam, describes townships as spaces filled with “working-age people desperate for economic opportunity, being spatially disconnected from urban centres that offer better economic prospects”.
Research by the World Bank shows that the majority of unemployed people in South Africa (about 60 percent) come from townships and informal settlements.
The townships have always been a hive of entrepreneurial activity but the main challenge has been unlocking the potential so as to generate broader economic benefits.
The Steve Tshwete Local Municipality, which is described as “a beacon of hope for efficient local governance” by the Department of Co-operative Governance and Traditional Affairs, has in recent years received several accolades which most other municipalities only dream of, including receiving clean audit reports for the past five financial years.
The Sunday Independent