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Data by industries
In terms of sectoral distribution, the broad lines are pretty similar to the comments made on the employment figures, with very small and small enterprises dominating in the service sector, and medium-sized enterprises strongly contributing to the agriculture and manufacturing sectors (Ntsika 1999). It should be noted that these data ignore informal contribution due to lack of data.
According to Ntsika (2000), significant differences between employment distribution and GDP appear, however, in two sectors:
• The trade and hotel/restaurants sector, where micro/very small enterprises represent 35.8% of employment but only 3.1% of value added. This suggests that the smallest supermarkets, petrol stations and restaurants operate at very low surplus levels.
• The services (especially finance and business services) sector, where large enterprises contribute to 69.3% of GDP, supposedly referring to the (relatively) high margins of South Africa’s large finance institutions.
SMMEs’ contribution to investment
Another important dimension of the economic weight of SMMEs is their contribution to investment. While there is very little information on this question, Abedian (1998) has attempted to qualify this figure with a very rough approach as Table 3.13 portrays.
Although this estimation would need to be refined, it is interesting in that it suggests very low investment behaviour of SMMEs compared to their share in employment and production. A reason may be difficulties experienced by these enterprises in getting access to sufficient finance to undertake investments. This certainly requires further attention.
Statistical data on SMME – conclusions and recommendations
Any policy decision concerning SMMEs requires accurate information about the size and structure of South Africa’s SMME economy. Ntsika aims to facilitate such decision-making by publishing annual reviews on the State of Small Business in South Africa. Nevertheless, the data presented in the various editions of the publication can be improved to meet the requirements of policy makers for a number of reasons.
Ntsika can only encourage Statistical Agencies such as Statistics South Africa and private researchers to address the shortcomings with regard to correctness and coverage of the existing databanks, but it must request SMME data that:
• Is more detailed (both by size-class and by industry instead of sectors).
• Relies on more than just a single data source.
• Reflects changes over time by maintaining the same definitions.
Conclusion
The previous chapter discussed the main functions of SMMEs with an emphasis on the structural features of the South African economy and its implications for SMME growth.
A theoretical consideration was also outlined as to whether SMMEs can resolve the unemployment problem and lastly the chapter attempted to give an overall view of the South Africa’s SMME economy with regard to size, profile and the performance of the SMME sector.
In the following chapter, international, regional and local experiences with regard to SMME development will be discussed.
Chapter 1: INTRODUCTION
1.1 Introduction
1.2 Background to the study
1.3 Purpose and objectives of the study
1.4 Problem statement
1.5 Delimitation of the study
1.6 Research design
1.7 Possible findings of the study
1.8 Structure of the study
1.9 Summary
Chapter 2: SOUTH AFRICA’S POLITICAL BACKGROUND AND ITS LEGACY
2.1 Introduction
2.2 Political background
2.3 Discriminatory measures
2.4 Legacy of discrimination
2.5 The impact of the legacy on the small business sector
2.6 The government effort to address the apartheid’s legacy
2.7 Conclusion
Chapter 3: THE SMME SECTOR IN SOUTH AFRICA
3.1 Introduction
3.2 Main functions of SMMEs
3.3 Structural features of the South African economy and its implications for SMME growth
3.4 Can SMME resolve the unemployment problem? – a theoretical consideration
3.5 Size, profile and performance of South Africa’s SMME economy
3.6 Conclusion
Chapter 4: INTERNATIONAL, REGIONAL AND LOCAL EXPERIENCES IN SMME DEVELOPMENT
4.1 SMMEs as major employment creators – evidence from industrialized countries
4.2 SMMEs as major employment creators – the experience in Africa
4.3 Employment creation through SMMEs – South Africa’s debate
4.4 Conclusion
Chapter 5: SOUTH AFRICA’S STRATEGY FOR THE DEVELOPMENT AND PROMOTION OF THE SMME SECTOR
5.1 The evolution of the SMME policy framework
5.2 The development of institutions to facilitate SMME development
5.3 Conclusion
Chapter 6: SOUTH AFRICA’S MINING INDUSTRY OVERVIEW
6.1 Introduction
6.2 Structure of the mining industry
6.3 South Africa’s mining industry strengths
6.4 Minerals exploration
6.5 Communication, infrastructure and labour
6.6 The industry’s role in national economy
6.7 Mineral production and sales in 2004
6.8 Mineral beneficiation
6.9 South Africa’s imports of mineral products
6.10 Forecast of minerals exports for 2004 to 2009
6.11 Regional co-operation – (SADC)
6.12 Conclusion
Chapter 7: TYPE OF STUDY
7.1 Introduction
7.2 Qualitative data of the study
7.3 Qualitative data analysis of the study
7.4 The interactive nature of the study process
7.5 Conclusion
Chapter 8: PROBLEM STATEMENT, RESEARCH OBJECTIVES AND PROPOSITIONS
8.1 Introduction
8.2 Problem statement
8.3 Objectives of the study
8.4 Research propositions
8.5 Conclusion
Chapter 9: RESEARCH METHODOLOGY
9.1 Introduction
9.2 Research design
9.3 Scope of the study
9.4 Research methodology of the first phase of the study
9.5 Research methodology of the second phase of the study
9.6 Conclusion
Chapter 10: RESEARCH RESULTS AND ANALYSIS
10.1 Introduction
10.2 Research frame work
10.3 Research findings of the first phase of the study
10.4 Study of the small black economic empowerment mining companies
10.5 Conclusion
Chapter 11: CONCLUSIONS AND RECOMMENDATIONS
11.1 Introduction
11.2 Centre for Small Business Promotion
11.3 Ntsika Enterprise Promotion Agency
11.4 Khula Enterprise Finance Limited
11.5 Effectiveness of the National Strategy
11.6 Other institutions influencing small business development
11.7 Parastatal enterprises and provincial SMME desks
11.8 Small Black Economic Empowerment mining companies
11.9 Overview conclusion of the study
11.10 Conclusion