Finance Minister Enoch Godongwana’s budget speech on 23 February signalled that government views small-business growth as one of the key drivers that will stimulate economic growth over the next few years.
This was validated by National Treasury’s remarks about achieving this growth through the combined impact of reforms, support for small businesses and new infrastructure investments.
Relief for small businesses was quantified in the budget through (among other things):
- The corporate rate dropping from 27% to 28%, and
- Announcement of the R15-billion COVID-19 Bounce Back Support Scheme for Small Businesses1
Economic growth is seen averaging 1,8% over the next three years. Growth is estimated at 4,8% in 2021 (down from the 5,1% projected in November) and 2,1% this year.
Thus it is clear that the stage is now set for supporting start-ups and small businesses to grow and contribute back to the fiscus over the longer term.
If we look at the funding landscape and cross-reference this with the fact that African tech start-ups raised more than US$1 billion in the first two months of 2022 (more than half the amount raised in the entirety of 2021)2 and that 16 South African start-ups have secured US$219 930 000 (19,6 % of the total), it is clear that international investors have confidence in securing investments in Africa (and South Africa) over a longer period of time.
WHAT IS NEXT?
With the above steps being taken to pump funding into our small businesses, I believe the next step is playing a role in assisting our small businesses in carving out a strategy to deploy this capital effectively and efficiently to maximise the rand spend versus business growth achieved.
At SAICA ED we have launched multiple programmes to support our SMMEs by connecting them with qualified CAs(SA) and SAICA members to enable and guide them from a financial excellence point of view.
Some of our notable programme launches are:
- Exxaro (since 2021)3
- Anglo American Zimele (2022)4
- Black Umbrellas (2022)
- Black Umbrellas CGC Consulting (2022)
- Avon and Dedisa Peaking Power (since 2018), and more5
As this funding landscape evolves, collaboration will be key in order to pool the learnings achieved in these programmes to continuously refine the SMME ecosystem and support that will be provided to SMMEs going forward to better deploy funding. We at SAICA ED are passionate about partnerships and developing a pipeline for economic impact, not only to develop SMMEs but to contribute to the United Nations Sustainable Development goals, in particular SDG 17 which speaks about the ‘need for true collaboration in the pursuit of all the goals by the year 2030’.
In light of this, we have launched the SAICA Chairman’s Difference Makers Awards Dinner in May and will be showcasing SAICA ED’s offering to CAs and funders in the ecosystem in order to launch more programmes in supporting SMMEs.
How can I as a SAICA member be part of this drive for economic growth?
You can be part of SAICA Enterprise Development’s 2022 volunteer coaching opportunity in our Enterprise Development solution to support small businesses to thrive and succeed.
We are looking for SAICA members to offer financial coaching and business coaching to small businesses. If you are interested, click here.6