South Africa is undergoing a change in its government and political atmosphere. Thanks to President Jacob Zuma, in 2015 30% of government procurement opportunities were set aside for businesses meeting the nation’s Micro, Small, and Medium definition. Currently SMEs (small medium enterprises) make up “40% of the R2.3 trillion generated by the private sector in the fourth quarter of 2016 according to Statistics SA’s Quarterly Financial Statistics Report.” In an effort to increase opportunities in South Africa, the set asides were created.
While the program is a benefit, many are criticizing the organization that is supposed to oversee the new program. South Africa’s small business administration is new and seeking an increase in budget to accomplish more. Currently within the government, some are holding back funds due to, what they see as, an unnecessary department. Despite the fight, the administration has developed a “framework with an implementation plan for the monitoring of the set-aside..in collaboration with the National Treasury. The department has also commissioned research into how to best craft a response to the potential impact of the downgrade on small businesses.”
It’s hard to argue against increasing the departments budget as it stands now. It’s new and still looking to find its legs under a 2 year old mandate. In my opinion at the very least they should increase it to see if they can reach out to more than just 80,000 or 3% of SMEs in the country. It’s hard to properly analyze a department when its new and still developing itself. Programs like these must be invested in for the sake of who they may help.
But that’s just my opinion.