Cape Town - The formation of an entrepreneurial ministry
would be a significant step forward in tackling SA’s unemployment crisis, say
Professor Dilip Garach, of Garach & Garach Financial
Advisory Services on Thursday added his voice to a call earlier by
entrepreneurial leader and Massmart founder Mark Lamberti for the creation of a
Ministry of Entrepreneurship in South Africa.
Endorsing the proposal, Nazeem Martin, MD of Business
Partners Limited and spokesperson for the 2013 Sanlam / Business Partners
Entrepreneur of Year competition, said the formation of an entrepreneurial
ministry would be a significant step forward in tackling SA’s unemployment
He said this is especially necessary following President
Jacob Zuma’s State of the Nation speech last week, which referenced government
programmes that support small business.
Garach said it is evident that government understands that
small and medium enterprises (SMEs) are an important source of jobs. “Minister
(Pravin) Gordhan said in his Budget speech of 2011 that businesses which employ
fewer than 50 workers account for 68% of private sector employment.
"But the government has shown very little commitment
towards solving problems that directly impact on experienced entrepreneurs and
He said South Africa recorded a 7% total early-stage
entrepreneurial activity (TEA) level in 2012, which is a 2 percentage point
decrease from the 9% recorded in 2011. “While South Africa is better off than
it was in 2004 when the TEA level was at 5.4%, the country still has much to
Garach said an entrepreneurial ministry will be able to focus
on reducing the cost of doing business, simplify the current business
registration process and SME tax system, create access to finance and create
appropriate incentives for South African entrepreneurs.
Another step in the right direction could also be government
entering into a public / private partnership in order to set up an
entrepreneurial academy. “The academy could develop schools that focus on
entrepreneurship, as well as provide education in business skills and promote
mentorship and training.”
He said in 1995 Malaysia formed the Ministry of Entrepreneur
Development, which clearly demonstrates the importance that the Malaysian
government places upon the issue of entrepreneurship and entrepreneurial
development. “The Ministry acts as the lead agency for the development of
entrepreneurs as well as to co-ordinate entrepreneurship activities in
Among the specific services currently offered by the
Ministry are a one-stop entrepreneurship information centre, franchise and
vendor development programs, entrepreneurial training, and subsidised business
premises for qualified entrepreneurs.
Other examples of economies that have implemented this type
of body include the US, which has a Small Business Administration Cabinet
position which arranges loans, loan guarantees and other assistance to small
businesses, as well as Croatia, which
has implemented a Ministry of Economy, Labour and Entrepreneurship, which
carries out proactive employment policies, according to Garach.
“The SA government target was to create five million jobs by
2020. Although it may not be possible to create this number of sustainable jobs
in the long-term, the government however can create an enabling environment to
set up one million entrepreneurs who then in turn create five million jobs,”
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