Download SMALL MEDIUM AND MICRO ENTERPRISES

SMALL MEDIUM AND MICRO
ENTERPRISES
A SOUTH AFRICAN
PERSPECTIVE
SOUTH AFRICA AT A GLANCE
•
Area 1,219, 090 km2
•
Population 44,8m
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Currency 1 Rand = 100 cents
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Time GMT + 2 hrs
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Head of State: President Thabo M Mbeki
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11 Official languages with English the business language
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Total GDP R1 523 bn (2005)
(US$ 215 bn)
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GDP per capita R31 850 (2005)
(US$ 4 568)
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Real GDP Growth 4.9% (2005)
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Inflation (CPIX) 4.1% (annual 2005 average)
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Exports Gold, minerals, diamonds, metals and metal products, food,
automotive components
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Main trading partners Germany, USA, China, Japan, France
SOUTH AFRICA: AN EMERGING
MARKET OF NOTE
• SOUTH AFRICA TODAY IS ONE OF THE MOST SOPHISTICATED
AND PROMISING EMERGING MARKETS GLOBALLY, MAINLY
BECAUSE OF:
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ABUNDANT NATURAL RESOURCES
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EXCELLENT TRANSPORT AND LOGISTICAL INFRASTRUCURE
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WORLD CLASS FINANCIAL SYSTEM
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ECONOMIC STABILITY & SOUND MACRO-ECONOMIC MANAGEMENT.
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COMPETITIVE SECTORS / INDUSTRIES
RELATIVELY LARGE LABOUR FORCE.
SOUTH AFRICA FROM A
GLOBAL PERSPECTIVE
• South Africa is one of the most sophisticated and promising
emerging markets, offering a unique combination of highly
developed first world economic infrastructure with a vibrant
emerging market economy.
• South Africa is one of the world’s 26 industrialised nations.
• The country is also regarded as the gateway to Africa.
• South Africa has the largest economy on the African continent,
accounting for approximately 25% of the continent’s GDP.
• According to the World Bank, South Africa ranked 28th in the world
for the ease of doing business in 2006.
• The JSE Securities Exchange is Africa’s largest and most developed
Securities Exchange and one of the world’s top 20 exchanges.
SOUTH AFRICA FROM A
GLOBAL PERSPECTIVE
•
South Africa remains the world’s top producer of minerals such as gold,
platinum, rhodium, chrome, manganese and vanadium.
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South Africa holds 80% of global manganese reserves, 72% of chrome,
88% of platinum-group metals (PGMs), 40% of gold and 27% of vanadium.
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Unit labour costs in South Africa are significantly lower than those of many
other emerging markets.
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South Africa scored well in various categories according to the 2006 World
Competitiveness Yearbook (61 countries ranked):
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Ranked 6th in the world in terms of price stability;
Our fiscal policy was ranked in 11th place;
24th position in terms of management practices (business efficiency);
31st place in terms of attractiveness for foreign direct investment; and
SA has the lowest electricity costs for industrial clients.
THE STATE OF SMALL
BUSINESS PERFOMANCE
• Small enterprise growth reached 7%
growth rate.
• Almost 40 000 new entrants annually.
• 40% GDP Contribution.
Main Contributing Sectors:
• Construction, Transport,
Telecommunications and financial
services.
IMPORTANCE OF SMME’S IN
THE ECONOMY
• ADVANCEMENT OF INFORMAL BUSINESS
SECTORS.
• SUSTAINABLE BUSINESS SECTORS
• ALLOWS FOR PARTNERSHIPS BETWEEN
GOVERNMENT AGENCIES AND THE PRIVATE
SECTOR FOR ADDRESSING THE ECONOMIC
CHALLENGES FACING THE COUNTRY.
INSTITUTIONAL ARRANGEMENT
• SMALL ENTERPRISE DEVELOPMENT AGENCY
• KHULA ENTERPRISE FINANCE
• SOUTH AFRICAN MICRO FINANCE APEX FUND
• THE DTI INCENTIVES
• INDUSTRIAL DEVELOPMENT COOPERATIONAND
NATIONAL EMPOWERMENT FUND.
SOUTH AFRICAN MICRO
FINANCE APEX FUND (SAMAF)
• Established to address poverty alleviation and
provide sustained access to financial services
for the poor.
• Autonomous institutions that operate
independent from government, provides for the
following:
• Access to affordable financial services
• Institutional and client capacity building
• Savings mobilization through co operations and
other formations such as societies and stokvels.
SEDA
Special Programmes involve the following:
• Manufacturing Advice and Marketing support
services – and mentoring, Research, Market
Linkages, Service provider partnership and
development.
• Business start up Service – Business registration,
Business Planning and capacity building
• Cooperative support
• Facilitation of Access to finance
• Technology demonstration Centers
KHULA ENTEPRISE
• Wholesale finance targeting retail finance
intermediaries.
• Credit indemnity schemes targeting
commercial banks.
• Partnership with the public sector on pilot
projects to boost upcoming businesses.
GOVERNMENT INCENTIVES
• Cooperative incentive schemes (CIS) – Start up
support for cooperatives.
• Cooperative special project fund (CSPF) – New
programme designed to support small to
medium cooperatives with huge impact on
employment.
• None financial support – Capacity building for
practitioners
• Cooperatives pre – incorporation seminars /
workshop for coop members.
SMME RELATIONSHIP WITH BEE ( BLACK
ECONOMIC EMPOWERMENT)
• BEE DEFINED: An integrated and
coherent socio-economic process that
directly contributes to the economic
transformation of South Africa and brings
about significant increases in the numbers
of black people that manage , own and
control the country’s economy as well as
significant decreases in income
inequalities.
RELATIONSHIP BETWEEN
SMME’S AND BEE
• BEE-SMME’S – refers to those companies
which are small, medium or macro with a
turnover of up to 10 million rands per
annum and which has more that 50%
direct ownership and management by
black people.
• SMME’S are beneficiaries of BEE
initiatives and they also contribute to the
process.
SHOPRITE CASE STUDY
• Shop rite Holdings and the Department of trade and
Industry’s Khula Enterprise Finance have signed a
groundbreaking agreement .
• Granting of retail franchise concessions.
• Training , mentoring and support to black entrepreneurs.
• Shoprite and Khula provide dual guidance in terms of
training and mentoring the SMME’s.
• Khula provides loans to concession holders to acquire
equipment and furnish their stores.
• Shoprite provides initial stock consignment to
concession holders .
RESULTS
• Project is a success and has been declared a
partnership that would be a model for future
partnerships between government agencies and
private sector for addressing some of the
economic challenges facing the country.
• Similar joint venture initiatives across different
industries such as mining and petroleum.
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CONTACT: MS SHIRLEY MAKHAYA
MR THABO MAFOKO
MR GOERGE BEZOUMATOV
+7 (495) 5401177
E-MAIL
: [email protected]