{"id":187529,"date":"2017-07-24T14:00:17","date_gmt":"2017-07-24T12:00:17","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=187529"},"modified":"2017-07-24T14:00:17","modified_gmt":"2017-07-24T12:00:17","slug":"4-graphs-that-show-why-its-so-tough-to-be-an-entrepreneur-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/187529\/4-graphs-that-show-why-its-so-tough-to-be-an-entrepreneur-in-south-africa\/","title":{"rendered":"4 graphs that show why it’s so tough to be an entrepreneur in South Africa"},"content":{"rendered":"

The OECD’s\u00a0Economic Survey of South Africa 2017<\/a><\/strong> suggests that the country needs\u00a0wide-ranging structural reforms to pull itself out of recession.<\/p>\n

The survey suggests a range of policy reforms, which includes encouraging South Africa to open key sectors – including telecommunications, energy, transport and services – to more competition.<\/p>\n

It also says that moving forward with the planned introduction of a national minimum wage will reduce in-work poverty and inequality.<\/p>\n

One of the biggest focuses of the survey is around entrepreneurship, where\u00a0growing small businesses is seen as a crucial element to boosting economic recovery and job creation, in a market wrought with high levels of unemployment and rising costs.<\/p>\n

According to the OECD, the South African government has taken steps to ease requirements for starting a business, but red tape remains a burden, while the quality of the education system and lack of work experience contribute to gaps in entrepreneurial skills.<\/p>\n

“There is scope to broaden the sources of finance and ensure that government policies provide both financial and non-financial support for entrepreneurs and small businesses,” the group said.<\/p>\n

In presenting its data, the OECD also highlighted four graphs which show the plight of entrepreneurs in the country – a strong desire to start businesses, but not enough skills and too much red tape to make this a reality.<\/p>\n

The first shows that, despite low entrepreneurial activity among the working population, there is a strong desire for entrepreneurial pursuits in South Africa, where entrepreneurship is seen as a very desirable career option, and the fear of failure is low, compared to other OECD regions.<\/p>\n

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However, South Africans have lower skills, and low confidence levels in this field.<\/p>\n

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Another challenge for entrepreneurs is red tape – the regulatory hurdles faced by prospective business owners getting their companies off the ground.<\/p>\n

Of all countries measured in the report, South Africa was only second to Brazil in taking the longest time to start a business, taking 42 days to accomplish this.<\/p>\n

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In terms of regulation, it is also apparent that South African businesses have to jump through hoops no matter which sector they try to set up in.<\/p>\n

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According to the OECD, South Africa needs to institute reforms to drastically reduce red tape in the country, particularly around licencing requirements. A focus should also be placed on education, with ‘second-chance’ programmes for early school leavers, and work placements in tertiary schooling.<\/p>\n

Speaking at the release of the survey, finance minister Malusi Gigaba agreed with its findings, saying that boosting entrepreneurship and growing small businesses will contribute to creating jobs.<\/p>\n

“We also agree that, notwithstanding the above, entrepreneurship in South Africa is low compared to other emerging economies,” he said.<\/p>\n

Gigaba said that, so far, steps have been taken to ease starting a business and the Department of Small Business Development is “currently addressing the red tape associated with starting a small business through simplification of procedures”.<\/p>\n

The department of small business development was set up by president Jacob Zuma in 2014, and to-date has not produced much in the way of results. According to minister Lindiwe Zulu<\/a><\/strong>, over the past three years, the department has “successfully put\u00a0small businesses and cooperatives firmly on the national agenda” and brought a “high level of awareness within government”.<\/p>\n

One of the key ‘victories’ scored, Zulu said, was the fast-tracking of a 30% SMME procurement policy.<\/p>\n

As part of a new wave of small business boosting from the department, Gigaba said that the government is in the process of finalising a complementary government fund aimed at financing SMMEs in start-up phase.<\/p>\n

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Read:\u00a03 out of 5 businesses fail in SA despite showing a profit<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

The OECD’s\u00a0Economic Survey of South Africa 2017 suggests that the country needs\u00a0wide-ranging structural reforms to pull itself out of recession.<\/p>\n","protected":false},"author":10,"featured_media":45198,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[26],"class_list":["post-187529","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/187529","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=187529"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/187529\/revisions"}],"predecessor-version":[{"id":187549,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/187529\/revisions\/187549"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/45198"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=187529"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=187529"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=187529"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}