Finance Minister Tito Mboweni yesterday referenced the private sector as the key engine for job creation in his National Budget speech. Ben Bierman, MD of Business Partners Limited, fully supports this statement, and says that there are five key take outs that local small and medium enterprises (SMEs) will benefit from:
- Falling data costs:
Minister Mboweni was adamant that the cost of data must fall, and committed to work relentlessly with the necessary parties to ensure this happens. As data gets cheaper, there will be more opportunities for SMEs and entrepreneurs to build their business and for new technology businesses to emerge. Making data more affordable and accessible can go a long way in driving economic and SME growth.
- The R30 billion allocated to build new schools and maintain school infrastructure spend:
National infrastructure spend is likely to be a big contributor to SME growth, and will create positive knock-on effects for job creation in the sector. Not only will SMEs be included in the supply stream, but as infrastructure projects are rolled out, economic growth will be positively impacted, having a downstream effect on small business.
- Relaxed visa requirements:
Relaxed visa requirements provide an enhanced opportunity for SMEs operating in the tourism industry, driving growth and the creation of new jobs. As tourism is a substantial contributor to the country’s GDP, the increasing the number of visitors to South Africa is extremely beneficial to the macro environment as well as for businesses operating both directly and indirectly in the tourism sector.
- Allocation of R3.2 billion to operationalise the small business and innovation fund over the MTEF:
The R3.2 billion budget allocation for the small business and innovation fund is a definite positive development for the country’s entrepreneurial eco-system and is anticipated to contribute to the creation of more innovative businesses that can respond to the opportunities presented by the 4th Industrial Revolution.
Also noteworthy is the R481.6 million allocated to the Small Enterprise Development Agency’s incubation programme expected to bolster the creation of new businesses and survival rate of existing businesses.
- Industrial business incentives:
The R19.8 billion allocated to industrial business incentives will not only benefit the national economy as a whole, but it will yield opportunities for local industrial SMEs and create job opportunities.
The R600 million assigned to the clothing and textile competitiveness programme is also a much needed boost to revitalize this struggling sector of our economy that has historically been a driver of economic growth.