30% state procurement to motivate small businesses


For years small businesses have been complaining that they are at the tail end of the government procurement value chain. Hence, to address their plight, in his State of the Nation Address, President Jacob Zuma announced that government was to specifically reserve 30% of state procurement for small micro-medium enterprises, co-operatives and township and rural enterprises.

In what business analysts as a “landmark” development, Zuma said: “If we are going to drive sustainable economic transformation, there has to be measures and programmes in place for government to support business – in particular black business.”

Bearing in mind the persistent challenges of translating good economic policies into tangible action, Zuma has tasked the new BEE council to take stock of progress to be made. Thus, he explained that the members would ensure that, as part of their on-going monitoring and evaluation, the B-BBEE [Broad-based Black Economic Empowerment] framework continued to attract foreign investment through the Equity Equivalent Programme.

The preferential procurement figure means that small scale service providers have to deliver quality services and products within time frames prescribed in tender documents. This has been a challenge for most black-owned businesses for years.

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One thought on “30% state procurement to motivate small businesses

  1. EDO Development Organization is based as a transformative community development poised at creation and enabling an environment for farmers, small businesses, community organizations, in agriculture and projects and wish to partner with stakeholders that have the same interests such as dep. of agriculture, tribal authorities, municipalities, arts and culture, rural and economic development as a united key partners in terms of development of communities at large in sustainable agricultural and commercial farming projects for the purpose of providing food security; thus ultimate creating the much needed economic activities such as employment creation and elevation of poverty in South Africa and the Continent. We wish for a recognition and a positive response as we have all plans in place.

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