Latest news with #Dtic
Zawya
3 days ago
- Business
- Zawya
South Africa: Young entrepreneurs get a boost with new exporter incubation programme
The Next-Gen Exporter Incubation Programme - aimed at equipping young entrepreneurs with the exporting skills, resources and support they need to become successful first-time exporters – has been launched by the Department of Trade, Industry, and Competition (Dtic). Speaking at the virtual launch, the Dtic's acting deputy director-general of exports, Willem van der Spuy, described the programme as a high-impact, 12-month intervention targeting youth-led enterprises with demonstrated export potential. Van der Spuy said the programme is specifically tailored for the alumni of the Entrepreneurship Development in Higher Education (EDHE) programme. 'At its core, this programme aims to cultivate an export culture among student and youth-owned businesses, enabling them to seize opportunities in global markets and contribute to inclusive economic growth,' he explained. The Dtic and the Universities South Africa (USAf) recently signed a Memorandum of Understanding on the EDHE programme to foster collaboration in promoting entrepreneurship and export development among student and youth-owned businesses. Van der Spuy believes the incubation programme represents a bold step forward in realising the shared vision of building a pipeline of globally competitive, youth-led enterprises. In addition, participants will gain access to expert mentorship and technical advice, training on export readiness and compliance, support in meeting international standards and certification requirements, and tools to develop market entry and export marketing strategies, among others. The programme also affords emerging exporters an opportunity to benefit from strategic trade frameworks such as the African Continental Free Trade Area (AfCFTA), the Southern African Development Community (SADC), the European Union, and cross-border e-commerce. Special emphasis will be placed on digital trade and digital platform solutions to expand global reach. The director of export development and support, responsible for the delivery of the Next-Gen Exporter Incubation Programme at the Dtic, Kwanele Mkhwanazi encouraged youth-owned business owners to apply for the first intake of the programme.
IOL News
26-05-2025
- Business
- IOL News
Transforming BBBEE: The potential of the R100bn Fund
Unsplash the Transformation Fund aims to channel R100 billion into firms that are majority black-owned and controlled, as defined by the BBBEE Act. Image: Unsplash South Africa stands at a pivotal moment. Two months ago the Department of Trade, Industry and Competition (Dtic) unveiled a draft Transformation Fund Concept Document, sparking a bold conversation about the future of Broad-Based Black Economic Empowerment (BBBEE). This proposed R100 billion fund, to be raised over five years, isn't just a policy proposal - it's a potential catalyst for reshaping economic inclusion, empowering black-owned businesses, and redefining corporate responsibility. But with great ambition comes great scrutiny. Will this fund deliver transformative impact, or will it stumble under its own complexity? A Vision for Empowerment Announced by the Minister of Trade, Industry and Competition in January 2025, the Transformation Fund aims to channel R100 billion into firms that are majority black-owned and controlled, as defined by the BBBEE Act. Administered through a tax-exempt Special Purpose Vehicle (SPV), the fund will operate as a registered Financial Services Provider, overseen by an eight-member board appointed by the Minister, including two private-sector representatives. Funding will come from a mix of government, public entities, international donors, development banks, and—crucially—the private sector. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ The private sector's role is where the fund's innovation shines. Companies can contribute through two key mechanisms: Equity Equivalent Investment Programme (EEIP): Multinationals without black shareholding can earn BBBEE ownership points by investing in Dtic-approved initiatives. The fund could become a new destination for these contributions, though it's unclear whether existing EEIPs will be required to redirect funds or if this applies only to new programs. Enterprise and Supplier Development (ESD) Points: The Dtic plans to amend the BBBEE Codes of Good Practice, allowing firms to earn ESD points by contributing to the fund. This could streamline compliance for companies while funneling capital to black-owned businesses. These mechanisms promise to align corporate incentives with national transformation goals, but they also raise questions about execution and impact. A Simpler Path to Compliance—or a Missed Opportunity? Under the current BBBEE framework, firms earn ESD points by directly supporting black-owned businesses with annual revenues of R50 million or less. This involves monetary contributions (like loans, grants, or investments) and non-monetary support (such as mentoring or training), fostering direct relationships that integrate beneficiaries into supply chains. The system incentivises swift action, as contributions must be delivered within the firm's financial year to count toward its ESD score. The Transformation Fund, however, introduces a tantalising shortcut: companies could earn ESD points 'immediately' by contributing to the SPV, bypassing the need to design and implement their own ESD programs. This could save time and resources, especially for firms struggling to meet ESD targets (2% of net profit after tax for supplier development and 1% for enterprise development). Tax incentives, including exemptions under section 56(1)(h) and deductions under section 18(A) of the Income Tax Act, sweeten the deal. But here's the catch: simplicity comes at a cost. Direct relationships between firms and ESD beneficiaries drive tangible benefits, like tailored support and supply-chain integration. By interposing the SPV, the fund risks diluting these connections, potentially slowing the delivery of benefits to black-owned businesses. The concept document's vagueness on the 'participation agreement' with the SPV adds another layer of uncertainty—will contributions come with strings attached? Voluntary Contributions, Strategic Choices The Dtic emphasises that contributions to the fund are voluntary, suggesting firms can stick with their existing ESD programs. But the proposed amendments to the BBBEE Codes could shift incentives, nudging companies toward the fund for its efficiency. The flexibility of the current system, where firms can scale ESD spending based on their strategy (while risking a downgrade if they fall below 40% of ESD points), may be constrained if the fund becomes the default path to compliance. Investors and business leaders should watch closely. The fund's success hinges on its governance, efficiency, and ability to complement—rather than compete with - existing BBBEE programs like the National Empowerment Fund, the Industrial Development Corporation, or the DTIC's Black Industrialist Scheme. Why create a new entity when established programs could be scaled up? The SPV must prove its value through transparency and measurable outcomes, or it risks becoming another layer of bureaucracy. An Investment in South Africa's Future The Transformation Fund is more than a policy - it's a bet on South Africa's economic potential. If executed well, it could unlock unprecedented opportunities for black-owned businesses, driving growth and inclusion. For investors, it signals a maturing market where transformation and profitability are increasingly aligned. Companies that embrace the fund strategically could strengthen their BBBEE ratings, reduce compliance costs, and build goodwill in a nation hungry for progress. Yet, the fund's promise depends on its delivery. Will the SPV operate with the agility and accountability needed to distribute R100 billion effectively? Can it amplify existing BBBEE efforts without overshadowing them? And will the private sector see contributions as an investment in shared prosperity rather than a compliance checkbox? South Africa's transformation journey is at a crossroads. The Transformation Fund could be a bold step toward economic justice—or a cautionary tale of ambition outpacing execution. As the Dtic gathers public comments, businesses, investors, and policymakers must engage to ensure this R100 billion vision delivers real, lasting impact. Pieter Steyn is a director at Werksmans Attorneys. BUSINESS REPORT
Mail & Guardian
17-05-2025
- Business
- Mail & Guardian
Transformation fund introduces new empowerment codes for transport sector
Trade, industry and competition minister Parks Tau. (Photo: X) Minister of Trade, Industry and Competition ( t he Dtic ) Parks Tau said on Friday that the R100 billion transformation fund will set aside resources for black-owned businesses operating within the transport sector. 'Too many businesses remain on the margins. We must double down on efforts where transformation has stalled. Enforcing existing codes will lead to deeper integration of the sector,' Tau said. Small, medium and micro enterprises (SMMEs) account for about 90% of businesses in South Africa, yet many are unable to access opportunities due to high asset requirements and limited credit histories, he said. The sector-specific fund will allocate resources for inclusion and capacity building in aviation, rail and ports. Tau said the fund will facilitate market access and provide export-readiness programmes with the goal of ensuring that the benefits of modernisation reach all stakeholders. In March, Tau proposed the creation of a R20-billion-a-year transformation fund in a concept document currently open for public comment. The goal of the fund is to promote the participation of black-owned enterprises and marginalised groups such as women, youth and persons with disabilities. The transformation fund has received criticism for repeating race-based legislation after 30 years of democracy, which has had disputed outcomes. A distinguishing feature of this new initiative is its explicit focus on high-risk rural and township enterprises, which have previously been neglected. Minister of Transport Barbara Creecy said the draft transformation fund and integrated sector codes will consolidate support for better outcomes in broad-based black economic empowerment (B-BBEE). Creecy stated that the logistics and freight subsectors remain largely untransformed, and that increasing the participation of black-owned businesses will have a positive effect on economic inclusion. The sector-specific fund will also focus on financing for taxi recapitalisation and aligning provincial regulatory frameworks. The government has therefore honed in on inclusion as the solution to unemployment and stagnant economic growth, while critics have said corruption-inducing BEE is the cause of joblessness. The new sector codes propose an equity-equivalent programme for multinationals and the removal of BEE recognition for companies that lose black ownership. Board voting rights held by black individuals will increase from 50% to 65%, and specialised technical positions will be reserved for junior black managers. The transport fund will deploy debt, grant and equity instruments to diversify economic activity beyond urban centres. The fund will therefore target support for rural and township enterprises operating outside of traditional value chains. The government's contribution will serve as seed capital to leverage further private sector investment. The fund also seeks to address the practice of superficial compliance aimed solely at avoiding penalties, which the government says undermines genuine transformation and meaningful market participation of black people. In response to the fund, the South African Institute of Race Relations (IRR) said that BEE legislation amounts to race quotas that have led to the decline of state-owned entities. The IRR argues that using race as a proxy for disadvantage is unfair and illegal, and that the government should follow the non-racial ethos of the Constitution. The IRR has also praised the Democratic Alliance for challenging employment equity laws in court. The institute believes that less race-based legislation and more investor-friendly policies will drive economic growth and reduce unemployment. However, the Black Management Forum (BMF) has said that in a country where 81% of people are black, with most living in poverty, neoliberal, trickle-down economics would not resolve this crisis and therefore the government should build the kasi economy. The BMF has criticised the World Bank for suggesting that South Africa should roll back its BEE policies to attract foreign investment. The bank argued that the country's excessive affirmative action regulations need to be overhauled for the country to grow, while the BMF said the private sector should carry a significant burden of the country's economic woes. The forum also criticised Old Mutual for appointing Jurie Strydom in May as chief executive, calling it a setback for transformation in a statement. 'As an institution with deep African roots and a significant continental footprint, Old Mutual is expected to reflect South Africa's diversity at all levels of leadership, particularly the executive level,' said the statement. Business Leadership South Africa (BLSA) welcomed the fund's intent but raised concerns over past empowerment failures, including weak risk management and poor recovery of allocated funds. The organisation said too much time had been spent on funding mechanisms and too little on mentorship and capacity building. The BLSA urged the government to clearly articulate how the final fund design will move beyond financing to achieve long-term transformation outcomes.
The Star
23-04-2025
- Business
- The Star
Samsung maintains Level 1 B-BBEE rating for seven years in a row
Samsung initiatives include partnerships with black SMMEs, workplace training, and education-based CSR Image: Supplied Samsung has accomplished a remarkable milestone by maintaining its Level 1 B-BBEE (Broad-Based Black Economic Empowerment) status for seven (7) consecutive years, an affirmation of its genuine commitment to transformation as well as continued development and growth in South Africa. The company has continuously set new benchmarks in the industry and confirmed its determination in driving economic transformation in South Africa through its B-BBEE Initiatives. The retention of this Level 1 B-BBEE rating signifies and emphasises Samsung's ongoing commitment to driving meaningful and sustainable economic transformation, diversity and inclusion within the organisation and the wider South African business landscape. Over the years, Samsung has demonstrated its dedication to diversity and inclusion through a number of B-BBEE initiatives illustrated by its diverse workforce, partnerships with black SMMEs, access to supply chains, investment in workplace training, graduate programmes as well as its education-based Corporate Social Responsibility (CSR) initiatives. These B-BBEE initiatives are driven through Samsung's landmark R280-million Equity Equivalent Investment Programme (EEIP), which was launched in May 2019 in collaboration with the Department of Trade, Industry and Competition (Dtic). Samsung is now celebrating six years of this programme's sustained success. This EEIP programme is projected to have a measurable impact on job creation in the South African economy. Now in its seventh year, the EEIP programme has managed to rise to the challenge of achieving its ambitious goals. Samsung's unwavering dedication to creating a more inclusive and equitable business environment is proven once more by the maintenance of this Level 1 B-BBEE status. Also, this rating re-affirms Samsung's continued drive to genuine economic transformation in South Africa and investment in the various pillars of the scorecard. The company's approach to B-BBEE over the years - has focused on five key pillars: Ownership through EEIP & Management Control, Employment Equity & Skills Development, Preferential Procurement & Enterprise Development as well as Socio-Economic Development (Social Responsibility). Samsung maintains its Level 1 B-BBEE status for 7 years, underscoring its commitment to economic transformation in South Africa. Image: Supplied As a good corporate citizen that has consistently supported the country's transformation agenda in the last three decades, Samsung has invested in a number of specific initiatives that have contributed immensely in fostering a more equitable society. As part of its skills development initiatives, Samsung has various programmes focused on electronics technician training, including the MICTSETA accredited Young Technician Programme. The aim of this MICTSETA accredited Young Technician programme is to bridge the gap between education and employment. This is a structured learnership programme that combines practical work experience with theoretical training. The programme provides learners with skills to be able to work at Samsung Accredited Service Centres. This 12-month programme equips learners with technical skills as well as behavioural competencies giving them hands on experience - enabling the learners to successfully enter the work place environment. Samsung believes in supporting academically deserving students with proven financial need to take their first steps toward achieving their dreams and to obtain their first Undergraduate or Honours Degree. The Samsung External Bursary programme aims to fund academically deserving students who do not have the financial means to study full time towards an Undergraduate or Honours degree at a South African University or University of Technology. The programme also prioritises people living with disabilities. The aim of the programme is to address skills shortages as well as to attract talent pool aligned to Samsung's business model. In 2024, Samsung benefited 122 bursars, including 82 students with disabilities. This well-considered and integrated approach has enabled Samsung to partner with universities and SETA accredited training providers to train 1440 software developers and accredited technicians to enhance their prospects of securing employment, starting their own businesses and further training. The training of unemployed youth addresses a key need in the South African ICT sector and has resulted in a marked increase in female software developer and artisan graduates. Also, in an effort to prove that its transformation agenda is not just a tick box exercise - Samsung has increased its focus on unemployed learners through its internship and learnership programmes - supported by an emphasis on creating work experiences during and post the learnership or internship period. This skills development programme is geared towards ensuring that Samsung increases the employability of the country's young hopefuls. Samsung's programme reach extends beyond Gauteng, it also includes Limpopo, Eastern Cape, Kwa-Zulu Natal and the Western Cape provinces. The EEIP is crucial for job creation, showcasing Samsung's investment in South Africa's future. Image: Supplied
