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eThekwini awaits clarity over R2.3bn economic relief for uninsured small businesses affected by the unrest

Families from Durban and surrounding areas pushed deeper into poverty after looting puts informal traders out of business.

The section of Isipingo Market destroyed by fire during last month’s unrest and looting. Picture: Supplied.

Published Aug 2, 2021


DURBAN - GUIDELINES on how eThekwini informal traders will get their slice of the R2.3 billion economic relief funding for uninsured small businesses will be finalised this week.

A meeting of the national and provincial government with the city will help provide clarity on how funds will be disbursed to assist the informal economy following the recent civil unrest, said Phillip Sithole, the deputy city manager for the Economic Development Cluster.

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A report before the city council shows that 55 000 informal businesses and traders were affected when they could not trade as looting and destruction hit the economy hard last month.

Briefing the executive committee recently, acting city manager Musa Mbhele said that the extent of the impact on the informal trading sector was that thousands of poverty-stricken families lost a source of livelihood as most of traders were breadwinners.

Sithole said: “We are going to engage with the provincial and national government (economic clusters departments that include departments of National Treasury, Trade and Industry and Small Business). This will help give us clarity on how financial support will be released to the informal economy.”

While it was the vision of the city to provide relief to the business community, particularly the hard-up informal economy, it would be difficult to extend the lifeline to unregistered enterprises as they could not be traced, Sithole added.

He said the 55 000 figure included traders with permits and those that do not have trading permits.

“It becomes easier to extend assistance to people who have permits because those are on our database. We are able to determine the nature and extent of aid they require, based on the rentals they pay,” he said.

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Since the advent of the Covid-19 pandemic, the informal economic sector was assisted through a 12-month suspension of rent payment.

“We have suggested that because of the civil unrest, the rental holiday be extended by an additional three months. That applies to traders operating in our buildings, which are referred to as incubators, businesses utilising what we call ‘business hives’ as well as those using sheltered and unsheltered stalls,” said Sithole.

Unveiling the relief package last week, Finance Minister Tito Mboweni said that support to small businesses that are not covered by the South African Special Risk Insurance Association would amount to R2.3bn.

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“These amounts are composed of reprioritisation of R1bn and additions of R1.3bn to the baselines of the Department of Trade, Industry and Competition and the Department of Small Business Development. These two departments will work out the modalities for assessing applications and getting the money to the correct recipients,” said Mboweni.


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