Mpumalanga Business 2017 edition

OVERVIEW Development

OVERVIEW Development finance and SMME support Public-private partnerships are supporting entrepreneurship in Mpumalanga. In the context of what the Premier of Mpumalanga, David Mabuza, has referred to as “mass retrenchments” in the steel industry, it becomes even more important that small, medium and micro enterprises (SMMEs) should prosper. In his State of the Province address, the Premier called SMMEs “a significant lever for increasing employment”. The province’s growth agency, MEGA, will loan a total of R500-million to small businesses over a five-year period with the 2016/17 budget set at R80-million. In addition, small business parks are to be built or renovated at Mayflower, Siyabuswa, Elukwatini and Kabokweni. Various partnerships with private companies are also in place: • The power plant being built at Kusile has benefited local communities, in particular companies owned by women and young people • A total of 82 businesses from Mpumalanga have graduated from Eskom’s Contractor Academy • Eskom will invest a further R30-million to support co-operatives • South African Breweries’ national KickStart Programme now has a regional component: 50 entrepreneurs from three Mpumalanga districts between the ages of 18 and 35 will be given intensive training (“boot camps”), support and capital to help them start and sustain their businesses. Participants in the Mpumalanga Youth SECTOR INSIGHT The Mpumalanga Youth Entrepreneurship Programme will provide training, mentoring and start-up investments. • Tomato growers have a direct line to Woolworths’ shelves. Entrepreneurship Programme can qualify for the KickStart Programme. • Sasol and Eskom are working with the provincial government on a fly-ash beneficiation scheme that will give business opportunities to SMEs. Private companies are also trying to support SMEs through MPUMALANGA BUSINESS 2017 86

OVERVIEW their buying chain. Woolworths is funding TechnoServe to ensure that small tomato growers can grow produce that will meet the demanding standards of the retailer, and to help them expand production. A regular supplier to Woolworths, Qutom, assists with the project. Using the supply chain to benefit small business is at the heart of Zimele, which runs four enterprise development and investment funds. The initiative experienced a growth spurt when a system of hubs was established, with managers assigned to each hub. The Thermal Coal Hub has several Mpumalanga centres and the Platinum Hub has two centres located in the province. The Mondi Zimele Hub in Piet Retief considers businesses in the supply chain and forestry. Zimele is supporting a bottled-water business that employs seven people at the eMalahleni waterreclamation plant. National government has created a consolidated agency to spur the development of SMMEs, the Small Enterprise Finance Agency (Sefa). Sefa falls under the Department of Small Business Development (DSBD) one of the biggest and most significant agencies in economic development in the country. Seda (the Small Enterprise Development Agency, which is an agency of the DSBD) is actively supporting co-operatives. Seda assists new businesses in drawing up business plans and gaining access to finance, helps train entrepreneurs in running a business and helps companies gain access to markets. There are five branch offices of Seda in Mpumalanga and a further four sites that form part of the Seda Technology Programme (STP): • Mpumalanga AgriSkills Development and Training, Nelspruit • Sugar Cane Incubator, Malelane • Mpumalanga Stainless Initiative, Middelburg • Timbali, Nelspruit. This initiative coordinates the growing programmes of a number of small farmers and helps to get products to market. One of the most experienced risk financers in the country is Business Partners, which started life as the Small Business Development Corporation. Apart from financial services, Business Partners offers premises for businesses and mentoring. Mpumalanga entrepreneur Nomsa Mazibuko’s first loans came from the Small Business Development Corporation when she transformed her hair salon into a hairdressing college. More recently she wanted to upgrade her tourism accommodation (Visit Vakasha) to five guest houses, a conference facility and a catering service with a large staff complement. Business Partners came on board as financier. Recent studies have shown that South Africa’s townships represent a market and an economy that is more substantial than was believed. The CEO of Minanawe Marketing, GG Alcock, told the FMCG Insights conference in May 2016 that what he called the “invisible market” was worth R10-billion. Alcock was quoted in the Sunday Times as saying that a particular fast-food operator made R50 000 per day from three outlets in a Johannesburg township. A survey by the Sustainable Livings Foundation showed that the number of informal businesses in a township grew from 879 in 2010 to 1 798 in 2015. The types of businesses ranged from tailors and spazas to meat, fish and poultry sales. Three people were employed on average by the small businesses. The Mpumalanga Provincial Government intends for its citizens to gain access to that market by encouraging entrepreneurship and co-operatives. ONLINE RESOURCES Business Partners: www.businesspartners.co.za Development Bank of Southern Africa: www.dbsa.org Industrial Development Corporation: www.idc.co.za Mpumalanga Economic Growth Agency: www.mega.gov.za Middelburg Chamber of Commerce & Industry: www.middelburg info.com National Department of Trade and Industry: www.thedti.gov.za Small Enterprise Development Agency: www.seda.org.za Small Enterprise Finance Agency: www.sefa.org.za 87 MPUMALANGA BUSINESS 2017