- Category: Grow Your Business
- Published: Wednesday, 22 July 2015 05:19
- Written by Jain Mc Guigan
As an SME owner, you are well aware that South Africa’s economic future is precarious, and you have the knots in your stomach to prove it.
In truth, if only recently acknowledged as such by the powers that be, SME’s are a critical contributor to GDP growth; the new Small Business ministry has yet to make any impact other than stress the importance of this fact.<hr id="system-readmore" />
SME’s are globally acknowledged as a major driver for employment and growth, but with SA’s GDP growth sitting at 1,4% and year on year revenues growing just above inflation at 13% its clear SME’s are simply not making the impact they could be.
SME’s shed 1 million jobs in the 5 years up to 2013; Stats SA estimates that 16 million people are going to be relying on social grants, which is fast becoming the biggest consumer of government budget.
The challenges contributing to SME contraction are substantial… lack of education & basic work skills, criminality, labour law & unionization, the effects of BEE policy, government interference, corruption, red tape (average time spent on this = 75 hours/month) and inefficiency, an increasing tax burden and the lack of access to finance.