South Africa in ‘Urgent’ Need of a Black-Owned Bank, Government Exec Says
Small businesses are beginning to take their place as the engine of the economy but are catching up from generations of being left out in the cold, Minister of Small Business Development Lindiwe Zulu said on Wednesday.
Last year, at least 18,000 small businesses submitted their tax returns for the first time last year, contributing to the record (U.S.) $63.8 billion that the SA Revenue Services raised, she said.
Enterprises such as these are driving economic growth across the economic continent and creating a new middle class.
But the Black population was still generations behind wealthy whites because their legal participation in the economy is only 22 years old, said Zulu.
”The banks won’t lend without a credit record. And all those who have credit records are those who were enriched five generations ago,” she said during debate on the department’s (U.S.) $27.4 billion budget.
What South Africa needs urgently is a Black-owned bank that understands the needs of a developing country, she continued.
Zulu quoted from a Goldman Sachs report that the South African economy could grow by 5 percent over the next five years if the government and private sector invest (U.S.) $766 million into 300,000 small businesses.
She encouraged small business to start forming connections on the African continent, but EFF MP Thilivhali Elphus Mulaudzi believed there was little hope of this bearing fruit with current trade patterns.
”The South African government has opened to many markets from India and China so that the small business cannot make a transaction,” said Mulaudzi.
DA MP Toby Chance said Zulu was not helping by being a “Sleeping Beauty in a fairytale land,” who provided political cover for President Jacob Zuma, instead of doing her job.
Instead of helping to build small enterprises, she was focusing on poverty alleviation, he charged.
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