Mashatile backs Transformation Fund to be a game-changer
Image: Siyabulela Duda/ GCIS
THE launch of the Transformation Fund will help expand spending aimed at supporting African and Black enterprises in townships and rural South Africa led by women, youth, and people with disabilities.
This is according to Deputy President Paul Mashatile, who delivered a keynote address at the business breakfast session and launch of the Transformation Fund at the Freedom Park heritage site and museum in Pretoria on Monday.
The fund aims to aggregate especially Enterprise and Supplier Development (ESD) funds in support of transformation and the participation of and sustainability of black-owned enterprises in the economy. It is expected that R100 billion will be aggregated over the term of the current administration through a joint effort by the government in partnership with the private sector.
The Fund has not gone without opposition, with the DA saying the government cannot create such a fund without first obtaining the explicit approval of Cabinet, especially when it effectively introduces a new tax on the private sector.
However, Mashatile described the launch as an important and historic day for South Africa as it marks a key milestone in the country's journey towards economic transformation.
'It will serve as a strategic vehicle for businesses to embrace change, foster innovation, and drive growth. This fund will serve as a catalyst for financial support, guiding organisations through crucial transitions and enabling them to seize new opportunities that arise in the market. As enterprises seek improved access to capital and the need to remain competitive in this dynamic environment, I believe that the Transformation Fund will be invaluable. The proposed Transformation Fund will unleash Enterprise and Supplier Development's (ESD's) potency in driving economic inclusion and participation,' he said.
Mashatile assured that the Transformation Fund will be at the centre of government, specifically the Presidency.
'We will work with the Minister of Trade and Industry as well as the key economic cluster Minister to ensure that we meet the set targets, especially in the procurement of goods and services. This will include expanding spending aimed at supporting African and Black enterprises in townships and rural South Africa led by women, youth, and people with disabilities. The Treasury and the Department of Women, Youth, and People with Disabilities have already collaborated to develop such a framework. The focus is to ensure speed of execution and equally implement the Preferential Procurement Policy Framework Act.'
Funding will be allocated to various productive sectors of the economy, which includes, among others, services industry, tourism, and agriculture, thereby supporting majority black-owned entities.
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