It is incomprehensible that the government has reduced the allocation to Small Business Development in the adjustments budget given the role that this sector plays in job creation and it will only exacerbate the current economic crisis.
South Africa’s economy was already in a recession before the Covid-19 pandemic and it is still contracting.
To make matters worse, South Africa is the victim of one of the world’s longest and most stringent lockdowns, which is self-inflicted. These lockdown measures are not economically sustainable and small business enterprises are suffering severe damage.
According to Stats SA’s business impact survey, more than 36% of businesses indicated that they had been forced to lay off employees between 14 and 30 April 2020, as a short-term measure and 9% of small business enterprises indicated that they have been forced to close permanently.
The government clearly does not realise that small business enterprises are the heartbeat of the economy that keeps the country going.
Surveys that were conducted in June already indicated that 75% of small and medium business enterprises will have to close down if the lockdown extends past 30 June. It is now more than a month later and the lockdown regulations are still in place. The investigation also estimates that 4 million job opportunities may be lost.
The government is supposed to create a favourable environment for small business enterprises so that they can grow and create more job opportunities. But with the recent budget cuts, that simply cannot be achieved.
Discriminatory legislation, like Black Economic Empowerment and Affirmative Action, should have been abolished a long time ago to allow business owners to enrich communities by stimulating micro-economies.
At present, certain ethnic groups are being excluded from financial aid schemes, which only contributes to racial polarisation in the country and it certainly does nothing for nation building or the survival of businesses and job security.
South Africans must unite around a new vision for the future that encourages individuals to take control of their own destinies with integrity, honesty, hard work and mutual respect.
South Africa’s economy was built up by means of sheer determination and skills – the time has come to fight back against a government that tends to want to destroy this heritage.
Read the original article in Afrikaans by Fanie du Toit on FF Plus
South Africa Today – South Africa News