During this time our economy is under a lot of stress it’s the time where the world community needs to look all the loopholes in the economic strategies of the country as to ensure that we build a stronger foundation for the future. We always encourage people to engage themselves in business to better themselves, communities around them and positively contribute to the country’s economy.
In the past years we have seen people investing their money by buying a slice in the ownership of big companies out there. This is the way of getting into business and investing your money. However in this way the investor sit back and looks how the company he or she invested in performs. Although shareholders are called to votes when companies are making decisions, however I think this way of investing is too individualistic.
The reason I’m saying this it’s because it does not directly create the employment to our community which is struggling in finding jobs to eradicate poverty and furthermore is does not provide with entrepreneurial skills to the person involve. Specifically in Africa we faced with poverty, illiteracy, etc. To have more entrepreneurs will help in making families of African have decent income. When taking your R500 000 and buy shares with it, and get dividend at the end of the financial year, think again of opening a small factory, business where you might employ about ten people. In that way you have secured yourself a good investment and you have provided employment to other people. Isn’t that good?
The other problem that we are facing here in South African is that it is very easy to get credit for consumer goods. You can find person earning R1500.00 per month being allowed to buy on credit expensive furniture, cell phone contract and other goods. However if a person earning the same amount go to the financial institution asking for a business loan for a mini tuck shop he want to open it is very hard for them to finance the proposal. This kind of situation is bad as it makes the finance out of reach for people who want to start their own businesses. This is where the government of the day can intervene to make the situation conducive for potential entrepreneurs to enter into business.
According to southafrican.info website there are 2.4 million of registered SMME’s in South African, accounting to 40% of the country’s Gross Domestic Product (GDP). Few will deny the positive contribution of SMME’s to the economy.
By Musa Gumede