INCREASING AGRI-PROCESSING CAPACITY CAN SPUR ECONOMIC GROWTH AND CREATE JOBSCasidra
The United Nations General Assembly has designated 27 June as Micro, Small and Medium-Sized Enterprises Day (MSMEs).
Referred to as Small Micro and Medium Enterprises (SMMEs) in South Africa, the day raises public awareness of the SMMEs’ contribution to sustainable development and the global economy.
SMMEs are the backbone of economies. Against the backdrop of the high unemployment rates in the rural economies, it is crucial to recognize that SMMEs account for 90% of all businesses worldwide and 50% of employment. Formal SMMEs also contribute up to 40% of Gross Domestic Product (GDP) in emerging markets, with 70% employment.
Since most businesses in the agricultural sector fall under the SMME classification, the Western Cape Department of Agriculture’s services ensures that SMMEs contribute to the economy of the Western Cape province.
The agri-processing sub-sector has the potential to spur economic growth and create jobs.
Therefore, the Department provides targeted support to SMMEs to increase their agri-processing capacity. To do so, the Department has identified several interventions to improve the ability of SMMEs in agri-processing to access critical strategic resources.
One of the highlights has been the “Agri-Processing On Wheels” intervention. This initiative has been launched in the West Coast and Overberg Districts. Initial awareness sessions have also been held in the Cape Metro and Central Karoo.
Several SMMEs have benefitted from support over the years. Berene Damons, the owner of Tesselaarsdal Wines (Pty) Ltd, is one SMME supported by the Western Cape Department of Agriculture. The company sells its wine locally and internationally (in the UK, Netherlands and USA). Western Cape Department of Agriculture (WCDoA) has assisted Tesselaarsdal Wines (Pty) Ltd with processing equipment and production inputs.
Herbal View Hydroponics (Pty) Ltd, owned by Mr Basil Williams and Ms Caroline Williams, is another example of an SMME supported by the Department. Their current farming activities include the production of fresh and dry herbs, pesto, sauces, vegetables and olive oil. In addition, they are supplying Kwik Spar De Jonker with vegetables, culinary herbs, lettuce and micro herb and several Delis and wine farms.
These businesses have for several years been receiving financial and other business support services from the Department.
Access to finance is another critical factor for the success of SMMEs. On this front, the Department established an Agri-processing Commodity Project Allocation Committee (Agri-Processing CPAC) to oversee funding applications under the Comprehensive Agricultural Support Grant.
To ensure that SMMEs have information on other sources of finance, the Department has compiled a booklet on the various sources of finance for which eligible agribusinesses could apply. The booklet is available on the Department’s website https://www.elsenburg.com/production-economic-support/.
That said, to achieve economic growth and job creation, (SMMEs) are an essential part of the future.