Durban - In a desperate attempt to quell xenophobic attacks, the KwaZulu-Natal government has announced investment of R300 million to assist local small businesses in competing with their foreign counterparts.
Economic Development Member of the Executive Council Mike Mabuyakhulu made the announcement during a meeting with small businesses in Durban on Wednesday. State Security Minister David Mahlobo and Home Affairs Minister Malusi Gigaba were part of the government team that attended the meeting at City Hall.
Mabuyakhulu said the provincial government was aware part of the reason for the violence was that small businesses were concerned about competition from foreign-owned businesses. He said to deal with this, government would invest R324.6m to help locals compete.
He said tuckshops, which locals had previously run from their homes, had been leased to foreigners who then ran them successfully using the previous owners’ business permit, which was illegal. “We request that you reclaim those businesses and establish business associations. We don’t want foreigners to be part of the associations,” he said.
He said R3m had been set aside to help set up the associations in 51 municipalities in the province. The deadline for establishing the associations would be June, and they would fall under the KZN Small Business Enterprise, a government entity.
“Members of the business associations will not buy stock from expensive wholesalers. Instead they will order directly from producers at a discount price. This is part of radical economic transformation in the province,” he said.
He said R21.6m would be invested in establishing training centres.
“Last year we announced the establishment of institutions to train business owners, which… would help you to understand how to run the business…
We are doing this because it has become evident black people have a challenge with business skills. They will start businesses but within five years they will shut down,” said Mabuyakhulu.
Business management skills training would also be provided.
He said R20m would be used to assist registered business people to establish new small businesses, while another R280m would be given to Ithala Bank to finance those who want to establish big businesses.
Premier Senzo Mchunu said the small business owners should help the government to deal with the violence, which he said had tainted the image of the country. “This violence kills the country’s investment opportunities, which can only be realised where there is peace.”
The Mercury