Black Business Council urges Ramaphosa to help black small businesses
DURBAN - The Black Business Council (BBC) urges President Cyril Ramaphosa's new administration to give a greater emphasis to black small businesses to drive jobs and the economy.
BBC president Sandile Zungu said in an interview corporates needed to give access to opportunities to small black businesses to supply goods and services to them.
Zungu said this would take persuasion, dialogue as well as talking to Ramaphosa to ensure that there would be some tweaking of the Codes of Good Practice and other laws to give greater weight to black African-led businesses to improve their stake in the economy.
The Codes of Good Practice is a guide for employers and workers on key aspects of promoting equal opportunities and fair treatment for people with disabilities.
Zulu said the required 5 percent to 7 percent economic growth required in South Africa would not come from big business alone, but to a large extent from small businesses.
“We expect the new administration to strengthen the capacity of the state to enable SMMEs (small, medium and micro enterprise businesses ) to play that role because that is where the bulk of black businesses are located,” said Zungu.
Zungu's call comes in a week that saw South Africa shed jobs.
Statistics South Africa this week announced that the number of employed persons decreased by 237 000 to 16.3 million in the first three months of this year, taking the unemployment rate to 27.6 percent from 27.1 percent in the last quarter of last year.
Ratings agency Moody’s said on Thursday that it expected South Africa’s growth to remain muted in the medium-term.
The BBC said black businesses in KwaZulu-Natal and the rest of the country was not growing as fast as desired.
Black business was still confined at the lowest rung of the economic ladder and remained synonymous with small and micro-enterprises, with only few exceptions punching above their weight, Zungu said.
Zungu said that these businesses struggled to get finance from various financial institutions.
“The banks do not want to give money to black business and even the Development Finance Institutions do not give money to black business. Those that are able to do so complain that they are under capitalised. Those that can will ask for unreasonable forms of security for lending,” said Zungu.
Zungu said, “In the next year, you will see a steep change in how we approach the issue of marginalisation and exclusion in the economy.”
The BBC’s new year begins in August. It said its programme of action would include putting a lot of pressure on the government, banks, large corporations and municipalities to do more business with black business.
“Our responsibility will have to do with delivering quality services, which is affordable and can be delivered on time,” he said.
Zungu, who has been at the helm of the organisation for the past nine months, has described the period as having been challenging at times because he had inherited an organisation that “was deep in the red” owing lots of money to the SA Revenue Service, landlords and service providers both small and large.
He said the council had managed to overcome this.
“At our Black Business Summit in February we were able to raise R12 million within minutes from among our own business leaders. The money was not just pledged but has also been received. We plucked the hole and now we owe Sars nothing, nobody else anything and paid our staff the 13th cheque that was overdue. This was a nice challenge which we had to overcome.”
Zungu said the other challenge they faced was a matter of credibility as the BBC had been associated with malfeasance a positioning which was not helpful in positioning the brand.
Zungu said they had had to work very hard to persuade the relevant stakeholders that they meant well and wanted to rebuild the organisation. The BBC had made great strides in that regard in the past nine months - a feat the organisation was proud of, he said.