On 30 July, the Delegation of Flanders in South Africa, the International Labour Organization (ILO) and the TMS Project administered by National Treasury organised a knowledge sharing workshop on SME Development in South Africa. The workshop under the guiding theme “Innovative models for Supporting SMEs in South Africa: What do we know, what can we do, and how will it stimulate job creation?” was organised at a critical point in time with the recent establishment of the new Department of Small Business Development and a budget allocation of R 6.5 billion over three years for supporting small and medium enterprises (SMEs).
More than 70 thought leaders from government, academia, private sector and civil society met at Freedom Park to exchange knowledge on what works and what does not work in SME development and to discuss innovative models for job creation through SME development. The workshop itself was based on innovative knowledge sharing methodologies that enabled participants to exchange and develop new ideas and formulate suggestions for increasing the effectiveness of future approaches to SME development in South Africa.
Vic van Vuuren, the Director of the ILO Office in Pretoria, emphasised in his key statement that investment in practical entrepreneurship education from an early age is critical to develop and instil an enterprising mindset in young people so that they want to become entrepreneurs by opportunity and not out of necessity and that their innovative energy is put to best use for the development of the country; he said that the policies and laws in South Africa favour big businesses and not small businesses, which have much higher compliance costs, and that red tape is continuing to hamper SME growth and job creation. Mr van Vuuren also stressed the enormous potential of the social economy and of social enterprises to create jobs across South African communities.
The most important recommendations emerging from the workshop were to stop supply-driven training to people who do not want it and rather focus on strengthening match making based on business opportunities between larger and smaller businesses, that sector and industry specific technical assistance to SMEs is important as opposed to general “one-size fits all” training. Participants also emphasised that role modelling and mentoring from experienced entrepreneurs to young entrepreneurs is vital to not set young entrepreneurs up for failure.
The workshop resulted in the establishment of a knowledge sharing network on SME development and Job Creation, which will be a means to provide expert advice to the formulation of SME development strategies and the work of the new Department of Small Business Development. The outcome and recommendations of the workshop will be shared with Minister Lindiwe Zulu.