Eastern Cape Business 2018 edition

A unique guide to business and investment in the Eastern Cape. The 2018 edition of Eastern Cape Business is the 11th issue of this highly successful publication that, since its launch in 2006, has established itself as the premier business and investment guide for the Eastern Cape. The Eastern Cape’s investment and business opportunities are highlighted in this publication. In addition to the regular articles providing insight into each of the key economic sectors of the province, there are special features on the role of the renewable energy sector on the region’s future and on the growth of tourism (spurred by the hosting of international events such as the 2018 IRONMAN 70.3 World Championship, the first-ever cricket Test match to be played at night at St George’s Park and Vodacom Origins of Golf events at St Francis Links). All of the major business chambers in the province have made contributions to the journal. To complement the extensive local, national and international distribution of the print edition, the full content can also be viewed online at www.easterncapebusiness.co.za. Updated information on the Eastern Cape is also available through our monthly e-newsletter, which you can subscribe to online at www.gan.co.za, in addition to our complementary business-to-business titles that cover all nine provinces as well as our flagship South African Business title.

OVERVIEW Development

OVERVIEW Development finance and SMME support Aquaponics and forestry are receiving support. Training programmes for new business owners and young people, a commitment from the provincial government and from municipalities that goods and services will be sourced from small, medium and micro-enterprises (SMMEs) and loan financing for start-ups: these are among the initiatives in place to help small businesses and co-operatives in the Eastern Cape. The provincial government has signed an agreement with the South African National Defence Force to take on young people to work on infrastructure maintenance and the Provincial Departments of Health and Education are making similar plans. There is a focus on agriculture, with the Office of the Premier and the Department of Rural Development and Agrarian Reform considering the creation of a fund to support training for young people and start-up enterprises in aquaculture and hydroponics. In terms of the Local Economic Development Procurement Framework, SMMEs will get 50% of all provincial government spending on goods and services. A database has been established. A programme of the National Department of Small Business (DSBD) is to be rolled out at municipal level in the Eastern Cape. An amount of R6.6-million has been allocated to the Informal and Micro- Enterprise Development Programme (IMEDP). The DSBD has several other programmes to assist SMMEs and co-operatives. These include: • The Black Business Supplier Development Programme, a costsharing grant to promote competitiveness • The Co-operative Incentive Scheme, a 100% grant. SECTOR INSIGHT SMMEs will receive R121- million in loans in 2017/18. The Small Enterprise Development Agency (Seda) is an agency of the DSBD and gives non-financial support to entrepreneurs through training, assistance with filling in forms, marketing and creating business plans. It helps small businesses draft applications for loan finance. The Seda Technology Programme (Stp) helps potential businesses become trading entities. Seda has a programme to make co-operatives and jointly owned enterprises stronger. Seda’s main provincial office is East London, with nine other offices located around the province. Several of Seda’s technology incubators are in the Eastern Cape. Port Elizabeth is the head office of the Chemin incubator which supports SMMEs in the downstream chemical sector. Furntech (a furniture incubator) has a branch in Mthatha and there are also construction incubators in the towns of Mthatha and Port Elizabeth. The Masisizane Fund offers loan financing at good rates and training through its Business Accelerator programme. As a non-profit initiative of the Old Mutual Group, the fund focusses on the cash flow of potential businesses rather than insisting on security in the form of property. Since 2014, the agencies of the Eastern Cape Provincial Government have disbursed R337-million in loans to entrepreneurs in 748 businesses. For 2017/18, an amount of R121- million has been allocated. The big retail banks have desks dedicated to promoting small enterprise and several agencies have a specific focus, for example the Eastern Cape Rural Development Agency (ECRDA). In promoting forestry enterprise, the ECRDA reported in 2015/16 having made R15-million available, while the Eastern Cape Development Corporation (ECDC) EASTERN CAPE BUSINESS 2018 60

OVERVIEW had contributed R8.3-million and the Development Bank of South Africa (DBSA) R64-million. This is a good example of the variety of funding available. The Industrial Development Corporation (IDC) is another financing institution that is active in the Eastern Cape. Several development agencies receive support from the IDC, for example the Nkonkobe Development Agency in the Amathole District. Two of the ECDC’s seven business units are devoted to small business: Development Finance and Enterprise Development. The ECDC has several financial products tailored to meet the various needs of business, entrepreneurs and investors, ranging from short-term to long-term finance and small- and micro-loans. The ECDC and the Technology Innovation Agency (TIA) jointly run the TIA-ECD Innovation Seed Fund Programme, which aims to identify and co-fund earlier stage technology innovation projects in the province. In its role as a provider of advice, the ECDC assisted a delegation from the Amahlubi Traditional Council when it attended the World Forestry Congress. This is part of the DBSA Jobs Funds Forestry projects. Help Desks have been established to support small business in Port Elizabeth and East London. One of the companies supported by the ECDC, outdoor furniture manufacturer PolyFibre Pty (Ltd), has received SABS approval for its products, which means the company can move to commercialisation. PolyFibre uses recycled plastic and pineapple waste to make its products. As part of its Small Contractor Development, Training and Community Participation programme, the South African National Roads Agency (SANRAL) offered training to 20 people from four SMME sub-contractors in the making of dolosse. Dolosse are the large interlocking blocks of concrete used to protect the N2 and railway line from the sea. Eight of the 2.5-ton dolosse are manufactured every day. The project’s main concrete subcontractor is Dynaform. The National Empowerment Fund (NEF) provides financial support from R250 000 up to R75-million for start-ups, the expansion of existing business, as well as the acquisition of equity. In the Eastern Cape, the NEF is supporting companies working in the fields of solar energy, restaurant franchises and transport. The Nelson Mandela Bay Business Chamber has a section devoted to SME support on its website and offers mentorship to start-ups and entrepreneurs. The Border-Kei Business Chamber has similar programmes. The Afrikaansehandelsinstituut (AHI) has rebranded as the Small Business Institute. Representing over a hundred chambers, the SBI is a member of Business Unity South Africa. ONLINE RESOURCES Eastern Cape Development Corporation: www.ecdc.co.za Eastern Cape Rural Development Agency: www.ecrda.co.za National Department of Small Business Development: www.dsbd.gov.za National Small Business Chamber: www.nsbc.org.za Small Enterprise Finance Agency: www.sefa.org.za Small Enterprise Development Agency: www.seda.org.za 61 EASTERN CAPE BUSINESS 2018