The announcement by ANC secretary-general Gwede Mantashe that a ministry for small, medium and micro enterprises (SMMEs) might be established is not a good idea.
Why does the government want to create an additional bureaucracy while the Department of Trade and Industry (dti) has a dedicated unit that focuses on enterprise development and that seeks to create and enabling environment conducive to the development and growth of SMMEs?
It also funds the Small Enterprise Development Agency, which provides non-financial business development and support services for small enterprises.
The growth of South Africa’s SMME sector depends on a holistic and integrated approach, something that the dti is ideally structured for. It plays a huge role in terms of the development of legislative and regulatory frameworks. It is active in the fields of trade, exports and investments and has a dedicated mandate to broaden economic participation and empowerment.
Furthermore, it has the in-depth understanding, the expertise and experience to optimise the linkages between trade policies, sectoral interventions, industrial action plans, support grants and other measures to broaden participation in the small business sector. These enablers of industrial development and trade provide a perfect nurturing environment for small businesses as well. The last thing to do is to fragment the golden thread that runs through all the activities of the dti.
Different state entities have one common mandate and that is to provide quality basic services to all South Africans. This noble mandate is often undermined by egos, turf wars and state departments’ habit of operating in silos.
Our appeal to the government is to shelve this idea of a separate ministry and rather to focus on strengthening the unit in the dti responsible for small business development and to get rid of all the obstacles – especially at policy and regulatory level – that undermine entrepreneurship.
Such a unit must interact with business chambers throughout the country to provide a localised incubation network for start-ups. Such a network can make experienced business people available to coach and mentor young entrepreneurs.
For this to happen, South Africa needs a unified business chamber movement that is, in part, funded by the state and that will act as an extension of the dti to roll out some of the programmes currently implemented by the department.
Sadly though, a unified and independent national chamber movement that consists of a strong network of chambers at district and local level remains a dream deferred due to organised business’s inability to see the bigger picture and to cross the racial and language divide.
To continue along this route is in nobody’s interests. Not only can a highly functional business chamber movement consisting play an instrumental role in growing the SMME sector, but it can strengthen the dti’s programmes that seek to grow this zone. This will require an official working relationship between the chamber movement and the dti and a collaborative framework aimed at broadening economic participation and empowerment.
Let business grow business. Not another government department with officials who have little or no exposure of what it takes for business to thrive.
Christo Owen van der Rheede is the chief executive of AHi