Improving market access opportunities for urban small, medium and micro-enterprises in South Africa

Abstract

Since the democratic transition of 1994, the promotion of the small, medium and micro-e nterprise (SMME) economy has been a core focus of South African government policy. With high levels of unemployment and poverty in urban areas, the impact of this policy intervention is most critical for city development. Given South Africa’s chequered history, the national government’s focus is on transforming the prospects for enterprises owned by black South Africans, who were disadvantaged under apartheid. This article examines the range of contempo rary policy initiatives to address business constraints on market access and catalyse new market opportunities for black-o wned enterprises in urban South Africa. The ar ticle concentrates on two themes: 1) building links into private sector supply chains, especially through supplier diversity, and 2) building links into public sector markets through public procurement. It is shown that current policy directions recognise that the national government has a limited capacity to implement SMME improvement and build competitive black-o wned SMMEs by itself, which has prompted support for private sector initiatives. In addition, the government is struggling to practice what it preaches and use its own procurement capacity to assist