PRESIDENT Cyril Ramaphosa has told the small business industry that government relies on the sector for job creation.
Ramaphosa was addressing webinar organised by the Department of Small Business and Development.
The president said 90% of the formal business sector in South Africa is made of small and medium enterprises (SMMEs).
“To achieve an inclusive economy we need to more effectively support the growth of vibrant and sustainable small, medium and micro enterprises and cooperatives,” said Ramaphosa.
“In many developed and developing economies, SMMEs generally account for over 90 per cent of all formal businesses. They contribute significantly to GDP and create and sustain lots of jobs in those countries.”
He said in South Africa, while 98% of formal businesses are SMMEs, they make a far smaller contribution to employment and GDP.
“If we are to achieve the goal of the National Development Plan for SMMEs to create at least 90% of the targeted 11 million new jobs by 2030, we need to pay far closer attention to developing small businesses,” he said.
The Department of Small Business Development, together with the Small Enterprise Finance Agency, reprioritised over R500 million to establish the SMME Debt Relief Scheme.
This was to help small businesses stay afloat during this difficult time.
“It has been reported that, as a result of the funds paid out under this scheme, over 23,000 jobs were saved,” said Ramaphosa.
“Of the SMMEs approved for support, 67% were black owned, 33% were female owned and 21% were owned by young people. It is a concern, however, that only 0.3% were owned by persons with disabilities.”
He said on top of the R200 billion credit guarantee scheme, the department has also established a business viability scheme to help small businesses drive economic recovery.
(SOURCE: INSIDE POLITICS)