Empowerment Zone to target SMMEs in Soweto

Thursday, February 26, 2009

Johannesburg - The face of Soweto will change with the establishment of the Soweto Empowerment Zone (SEZ), a support facility for small businesses in the township.

"The mall boom and the establishment of the SEZ in the township signal a change for Soweto, from a dormitory township to an economic and entertainment player in the city," said Mpho Leseka, a deputy director in the City's Department of Economic Development.

As a small business support facility, the SEZ is located along Chris Hani Road in Diepkloof, just a stone's throw from Chris Hani Baragwanath Hospital, reports Joburg.org.

"The SEZ is an industrial park to support, promote and formalise Soweto-based small medium and micro enterprises [SMMEs] situated at the major gateway to Soweto."

The robust sustainable economic development zone aims to mobilise and grow black economic empowerment (BEE) SMMEs from Soweto mainly through developing and strengthening links with established businesses and service providers.

The 34ha SEZ will comprise of seven sector clusters, each anchored by a "cluster champion".

"One of the big clusters will be the auto industry, anchored by a cluster champion like, for example, Toyota or some other big motor industry name.

"The cluster champion, preferably a BEE company, will provide business support services like marketing, quality control and capacity building to SMMEs," Ms Leseka said.

Other sectors that will be invited to the SEZ include furniture and homeware; home improvements and building; medical; and printing clusters.

At the core of the clusters will be financial service providers, the South African Revenue Services (SARS), the City of Johannesburg tender office, offices of the Department of Industry, Small Enterprise Development Agency (Seda) and Companies and Intellectual Properties Registration Office (Cipro) offices.

On the other hand, the City of Johannesburg will facilitate the development and staffing of a business support centre within the SEZ.

The SEZ will not be an incubator or training facility, but will be a place where small businesses grow and possibly leave the cluster and establish somewhere else, according to Ms Leseka.

"This will give an opportunity for another SMME to come in and participate in the cluster."

All clusters will share SEZ facilities and contribute to the overall property management of the business centre.

"Each cluster must be viable in its own right, must cover the cost of operating from the SEZ and must deliver developmental outcomes in terms of SMME growth," she said.

Some of the key principles of SEZ will include attracting, developing and supporting BEE businesses as well as ensuring that SMMEs from the Soweto area are the primary beneficiaries.

The Department of Economic Development will send out calls for expressions of interest soon to small businesses in the township, Ms Leseka said.
"We want small businesses from Soweto that have no place to operate from and are keen to grow. Already, we have people who are keen to join the SEZ."

SMMEs interested in joining the SEZ should be willing to learn new technology and should deliver their products on time. They should also continuously improve on quality and costing to stay competitive on price.