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World Cup kicks up SMME growth hopes, survey shows

Published May 28, 2007

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Johannesburg - Small, medium and microenterprises (SMMEs) are optimistic about continuing growth, according to the first quarterly SMME survey by Africagrowth Research.

The Cape Town-based company surveyed 80 SMME managers around the country involved in the industrial, trade and services sectors, about growth prospects.

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The services sector, which includes the tourism and hospitality industry, grew the most at 10.85 percent, compared with last year's 7 percent.

Africagrowth president Nicholas Biekpe said growth in the services and industrial sectors could be largely attributed to opportunities presented by the 2010 soccer World Cup. "Growth in the tourism industry had a positive role in increasing business prospects and growth in these sectors."

Slight growth of 1.92 percent in the industrial sector was attributed to infrastructural projects and housing demand.

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"We are anticipating more growth in our next survey, as more business opportunities will be available. The projections may not be ideal but a positive indication for a good business year," said Biekpe.

But Tebogo Khaas, the president of the SMME Forum, could not agree with Africagrowth's projections.

"This survey paints an unbelievable picture of what is happening on the ground," said Khaas. "The SMME industry is still bedevilled by red tape and unfair competition from big business, which limits their chances of growth.

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"The majority of small business owners are prevented from taking up big profit making jobs, which are still the domain of bigger companies.

"The success of SMMEs relies heavily on support and commitment from both the private sector and government," said Khaas. "Their initiatives haven't done enough to alleviate the scale of bias and prejudice when it comes to granting of private sector jobs."

Lolo Mabitsela of Lolo's Guest House in Soweto was confident her business would enjoy further growth as more people showed interest in township tours. "The interest shown by local and international people has grown considerably in the past year compared with when I started ... four years ago."

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Mabitsela counted private support received by the township hospitality establishment as a major boost for the industry. Her business is one of 23 township guesthouses adopted by Sun International in an information sharing network.

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