SME business support is vital to a more robust South African economy.

Under the right conditions, a strong SME community can be a dynamic transformational force. In the words of the World Bank, “relative to larger firms, SMEs enhance competition, entrepreneurship, job growth and drive economy-wide efficiency, innovation and economic growth.” Entrepreneurial activity and small business ownership play an essential role in the resilience of local and regional economies. A vibrant SME sector provides business diversity that helps shield countries from the economic impact caused by external shocks, such as Covid19.

Unlike their larger counterparts, SMEs are more flexible, and therefore, able to adapt faster to sudden market changes. It is even argued that SMEs through innovative activities, can take advantage of economic shocks and the disequilibrium and emerge stronger than before. These characteristics mean that SMEs may be more likely than larger firms to pursue growth-orientated strategies in recessions, thus boosting local economic resilience.

The South African small and medium enterprise (SME) business sector is as vibrant, diverse, and remarkable as the colour spectrum of our rainbow nation. However, the SME sector is just not big enough to provide us with the benefits and shock absorbent characteristics that a healthy SME sector should provide. Therefore SME business support and growth is vital for our economy.