Private and public sector collaboration essential to SMEs - CNBC Africa

Private and public sector collaboration essential to SMEs

Southern Africa

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Lack of funding ad red tape are some of the problems SMEs in South Africa continuously have. PHOTO: Getty Images

“We have this twin soul where we would like to do good and we’d like to do well. Doing good for us means we make funding accessible to small businesses so that these entrepreneurs can pursue wealth for themselves,  grow the economy, broaden their the tax base and create jobs for many South Africans,” Nazeem Martin, managing director of Business Partners, told CNBC Africa.

“At the same time, we have to do [well] profitably, and the simple reason is that we want to make sufficient profits so that we can grow the amount of funding that we have available to do the good work that we do.”

Martin added that as a result of the various aspects of assistance a Small to Medium-sized Enterprise (SME) needs, Business Partners developed a suite of products.

These range from business finance through to business premises, as well as mentorship and technical assistance services, which Martine believes most small and medium-sized business entrepreneurs require.

(READ MORE: Access to funding still a sizeable obtacle for SMEs)

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Newly appointed minister for Small Business Development Lindiwe Zulu is expected to make the process for SMEs to set themselves up significantly easier, as well as connect the private sector to the businesses.

(READ MORE: Minister Lindiwe Zulu has a huge task on her hands: John Endress)

“We must congratulate the minister on the recent appointment. How it’s going to pan out depends on a number of factors. It depends on the approach the minister is going to take. She has, in my view, broad choices,” Martin explained.

“She may ignore all the other departments and set up her own department, create another bureaucracy [and] possibly another layer of red tape, which we call ill afford. From a budgetary perspective, the country can’t afford another bureaucracy. We would advise her not to do that.”

(READ MORE: Africa's SMEs require an enabling business environment)

Martin added that Zulu will nevertheless have to carve out a niche for herself in her sector, which could see her playing a slight coordinator role before fully taking the reins of her portfolio. The need for synergy between government and the business industry is a crucial bolt to tighten while in office.

“Government touches small businesses in every aspect, from setting the environment, policies, legislation, regulations as well as the programmes. Government procures from businesses big and small, so government impacts on the health and well-being of small businesses,” Zulu explained.

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