The provincial government’s plan to get businesses to source supplies from black entrepreneurs has the approval of the captains of tourism and retail industries, but the capacity to meet the demand could be a challenge.
Addressing stakeholders in industries such as hospitality, retail and wholesalers in uMhlanga on Thursday, the MEC for Economic Development, Tourism and Environmental Affairs, Sihle Zikalala, introduced Operation Vula, an agrarian socio-economic transformation plan which forms part of the government's radical transformation agenda.
According to Zikalala, the aim is to get the private sector to open up opportunities for black entrepreneurs.
“The growth in inequality is posing a threat to the economy of country But you cannot distribute something that does not exist. We need to work together to grow the economy of KwaZulu-Natal and attract investment to our province,” he said.
He described radical economic transformation as an effort to support black people to get into business through supporting mechanisms, such as the provision of loans and grants to be able to compete.
“The growth in inequality is posing a threat to the economy of country ... .But you can not distribute something that does not exist so we need to work together to grow the economy of KwaZulu-Natal and also attract investment to our province,” he explained.
He described radical economic transformation as a deliberate effort by government to support black people to get into business through supporting mechanisms such at the provision of loans and grants to compete in the different sectors of the economy.
“We are not saying you must run your businesses down but we appeal that we should partner,” Zikalala pleaded.
He said the aim was not to close doors for suppliers who already have contracts with big businesses but integrate black entrepreneurs in the mainstream economy.
The programme received support from leaders in the hospitality and retail industries such as Tsogo Sun’s Mike Jackson, chairman of Massmart Kuseni Dlamini and Brian Mpono, who is the project director in Vivian Reddy’s numerous developments including the Radison Blu Umhlanga Oceans hotel.
“Having initiatives like these is the only way we are going to tackle the challenges that we are facing such as unemployment and slow economic growth so we really have to collaborate and support this operation,” said Jackson.
His sentiments were echoed by Dlamini who said Massmart was not only willing to work with black-owned small businesses but also provide grant funding to black entrepreneurs to grow their businesses.
“We would like to open our supply chain to local supplies. It’s not charity but we believe that we can grow and prosper together,” said Dlamini, whose Massmart group owns Game stores and Cambridge Foods.
However, quality, consistency and quantity were some of the concerns raised by some of the business leaders including Markus Fritz, general manager of Hilton Durban.
“We need the government to come and ensure that we are able to get quality produce in required quantities consistently,” said Fritz who said Hilton would support the programme if those were guaranteed.
Paul Ngema, a small scale farmer from Eshowe, added that while they were happy about the programme, most eligible farmers still needed to be capacitated.
“In Eshowe we are supplying schools with fresh produce but were already struggling to meet the demand so it’s going to be hard to supply the new market unless we get help.”
He said other small-scale farmers also needed training on business skills so that they were able to negotiate directly with the buyers.
Zikalala noted the concerns and assured the business community that adequate training would be provided through departments such as agriculture and corporative governance to ensure that the black entrepreneurs not only met the demand but also supplied quality products.
In each district, the provincial government plans to identify industrial space that could be used for investment such as warehouses. He said while Operation Vula prioritised the localisation of the economy the South African government was not advocating regionalism but want the local businesses to trade with the rest of Africa and the rest of the world.