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Ministry of SME’s needed in South Africa

By MPHAHLELE KUNENE

“It’s about time that our country [South African] creates a ministry of Small Medium Enterprises (SME). This will be important in addressing the concerns and challenges of this sector which has been largely ignored.”  These were the words of  Sello Motsei, Founding Member of Kgwebong Communications Company  after returning from Indonesia.
Motsei had been invited by the Municipality of Tasikmalaya and the Chamber of Commerce in Indonesia to film a documentary for 10 days about the SME’s role in that country.

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Motsei said the SME’s in Indonesia were vital in creating jobs, contributing to the country’s economy and alleviating the levels of poverty. He further said this was due to the policy and framework adopted by the Indonesian government in 2008- after the country realised that big companies were closing down due to the global economic meltdown.
“In our country SME’s are not taken seriously unlike in Indonesia. If our government can look at the model of Indonesia we can learn a lot from it and in the near future we can see tangible results just like what they did five years ago,” said Motsei.
The Indonesian government in 2008 created two types of financial institutions in Indonesia, namely banks and non-banks. Banks were categorized as commercial banks and rural banks.  The commercial banks had access to the payment system and offered a full range of banking products. Rural banks are comprised of relatively small sized banks compared to the commercial banks. They do not have access to the payment systems and do not have to open an account at the Central Bank. Rural banks, in addition, must not deal with foreign exchange transactions and must not deal with foreigners neither in Rupiah nor in other foreign currencies,” explained Motsei.
This strategy was seen by many citizens in Indonesia as a model that can assist the government in growing the Gross Domestic Products (GDP).  In the  short term this policy increased the productivity and export value of cooperatives and SMEs’.
Among the policies adopted include;  expand the businesses of cooperatives and SMEs to agribusinesses; raise the number of new enterprises based on science and technology; and increase the capacity of micro enterprises particularly for the under privileged group in rural and underdeveloped regions.
Motsei emphasised that based on his observation and interactions with small business in South Africa some of the challenges faced by the SME sector were: limited access to financial resources; lack of technological skills and management; limited human resource capability and a friendly environment of operating in.
While in Indonesia, Motsei proposed a library be built in Tasikmalaya which will also support the community in studying about trends of running a business. This included a letter of intent which further states that there should be a cooperation in development of the community. Among the signatories were Wahyu Tri Rachmadi of Tasikmalaya City of Chamber of Commerce and Industry, Rector of Siliwangi University Professor  H. Kartawan and as a witness was  the First secretary of the Political Section at the South African Embassy in South Africa, Moses Phahlane.

 


 
Saturday, 25 October 2014
  • Sunshine on Leith
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September 2014 Edition

 
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