VAIDS

Tuesday, July 12, 2016

Better policies will ‘allow small businesses to contribute to growth’

SOUTH Africa needs to improve its policies and address barriers to entry if more small businesses and black industrialists are to grow and contribute to economic growth.


This is according to the University of Johannesburg’s Centre for Competition, Regulation and Economic Development (CCRED), which released new research on Tuesday.

"The challenge for black industrialists is that they are getting finance but there isn’t an environment which allows them to bring their products to market," CCRED director Simon Roberts said.
While financing remained a barrier to entry for many other small businesses, focusing on this aspect alone without simultaneously tackling other barriers was futile, Roberts said.

Barriers to entry were identified as consumer behaviour, exclusionary conduct by incumbents, risk aversion in financing entrants, and accessing markets and value chains.

The centre proposed four solutions: changing regulations; amending the Competition Act, especially the abuse of dominance by big companies; establishing a fund for risk; and opening routes to markets

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