Small Business Key in Job Creation: South African Minister

Small businesses have a key role to play in providing opportunities and creating new jobs in emerging economies, South Africa’s Minister of Trade and Industry Rob Davies said. Speaking at the International Small Business Congress held at the Sandton Convention Centre, Davies said South Africa needed to develop a more symbiotic relationship between big companies and small suppliers.

In South Africa, small businesses had good potential when it came to job creation, as the cost to create one job in a small firm was less than it was to create a job at a big firm, as large businesses were more capital intensive. However, he said the country needed to raise the skills level of business owners so that firms didn’t simply stumble along, and that their creative ideas could be turned into job-creating enterprises.

Davies said before 1994, the apartheid government had not only neglected black businesses, but had actively undermined and prohibited or restricted black people from starting businesses. The apartheid state had created the Small Business Development Corporation (SBDC) in 1980, but Davies said the organisation proved a highly politicised body which did not lead to equitable assistance of small enterprises from all groups.

However after 1994, the new government had set up the Small Business Development Act in 1996, which led to the setting up of several institutions, including Ntsika – which in 2004 became the Small Enterprise Development Agency (Seda) and Khula Enterprise Finance.

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