JOHANNESBURG – Small businesses and emerging farmers received a multibillion-rand boost from the National Treasury with the establishment of a Small Business and Innovation Fund and further financial support for emerging black farmers.
The budget review said the government would launch the fund in the current financial year.
“The fund will receive R3.2 billion over the medium-term, which it will lend to small business intermediaries, such as fund managers and incubators. The intermediaries will fund and support ideation and start-up companies and small businesses focusing on innovation,” the Treasury said.
The government further allocated R481 million to the Small Enterprise Development agency to expand its small business incubation programme.
The Treasury said spending on economic development would increase by 7 percent in the next three years.
“The economic development function aims to increase economic growth by improving access to loans for small business intermediaries, providing industrial business incentives, accelerating land reform and developing infrastructure.”
Small Business Institute executive director Bernard Swanepoel said the government should consider a voucher or credit for SMMEs to cover the costs of specialist advisers across the start-run-grow continuum.
“According to South Africa’s firstbaseline study on SMMEs, 98.5 percent of all businesses in South Africa are SMMEs and yet they create only 28 percent of jobs; the international norm is in the region of 60 percent to 70 percent,” Swanepoel said.
The government said that despite moves to amend the Constitution to allow for land expropriation without compensation, it would still spend nearly R20bn to procure land for restitution purposes.
The Treasury pledged R18.4bn in the next three years to finalise 1 700 restitution claims and procure more than 325 000 hectares.
Finance Minister Tito Mboweni said the government was supporting private-sector investments in agriculture by emerging farmers.
The Agricultural Research Council will also be given R400m over the medium-term period to finalise the establishment of a foot-and-mouth vaccine facility at Onderstepoort,
Pretoria, with the aim of helping to minimise repeat outbreaks of the disease.
China last week suspended wool trade from South Africa owing to the foot-and-mouth disease outbreak in Limpopo.