A township entrepreneur outside her B&B. Department of Trade and Industry director-general Lionel October, left, says a project management unit has been set up to support the development of small businesses in townships.
Durban - The Department of Trade and Industry (the DTI) has announced that it will create a project management unit to transform the township and rural areas into hives of economic activity and production of goods and services.

The department said the unit would drive the implementation of the recommendations of a recent two-day Broad-Based Black Economic Empowerment (B-BBEE) Rural and Township Economy Summit that was held in East London.

The department’s director-general, Lionel October, said: “There are various recommendations and solutions to the challenges that we are facing in our efforts to upscale the township and rural economy.

“But what came out loud and clear from all the commissions in the summit was that we needed a clear and concrete implementation mechanism if we were to succeed in transforming this economy.”

He said this mechanism would be the project management unit and it would be an inter-governmental structure that would be located in institutions such as the Council for Scientific and Industrial Research.

October said it was clear from the discussions and recommendations of the commissions that small and medium enterprises in townships and rural areas were not benefiting as they should from the policies, financial support and procurement opportunities of the government.

“There is a gap between our policies, financial support and procurement opportunities offered by the government, and the implementation on the ground. This is a big problem that has been identified, and the government will be working hard to address it,” said October.

He also said the DTI would be proposing that the clearing house model that is implemented in Gauteng and North West be replicated in all of the country’s provinces and located in the highest offices of the provinces. He said the clearing house is located in the premier’s office and has control of procurement of all government departments and municipalities in a province.

“The clearing house is where access to procurement opportunities is given to small, medium and micro enterprises (SMMEs). This clearing house mechanism will also take care of all of the concerns and complaints raised in the summit about corruption and gatekeepers, in order to close the gap between the procurement opportunities and the delivery on the ground,” said October.

He conceded that at present there were no real funding programmes for informal and very small businesses. To this end, the DTI would propose to the National Treasury the creation of a no-frills, hassle-free funding model for these kinds of businesses.

October also pledged that the government would:

* Establish one-stop-shop business centres in townships and villages which would house finance institutions such as the Small Enterprise Development Agency and Small Enterprise Finance Agency.

* Roll out broadband in the townships and villages to assist entrepreneurs keep up with the Fourth Industrial Revolution.

* Forge strategic partnerships with traditional leaders, business chambers and get big corporates to invest in the townships and rural areas.

October also said there would be prioritisation of the three poorest provinces of the country, namely Eastern Cape, KwaZulu-Natal and Limpopo for the roll-out of the new government interventions aimed at stimulating the township and rural economy.

“We will also be undertaking a roadshow to enlighten businesspeople about procurement opportunities that are available for various sectors and how to take advantage of them,” concluded October.

The Mercury