R450million cash investment by the EU will help small enterprises
Lihle Z Mtshali
Lihle Z Mtshali
Black economic empowerment and job creation in the small- and medium-sized enterprise (SME) sector were given a boost yesterday with the launch of the European Union's (EU) second phase of its Risk Capital Facility programme.
The EU invested a further R450million into the facility after an initial investment of R549million in 2002, which helped create more than 5100 jobs in 90 black economic empowerment SMEs.
The funds will be channelled through the Trade and Industry Department and managed jointly by the Industrial Development Corporation (IDC) and the European Investment Bank.
Lionel October, deputy director- general for the Enterprise and Industry Development division of the Trade and Industry Department, said that the government believed that growing small enterprises was vital to achieving the country's goal of halving unemployment and poverty by 2014.
The latest investment will go towards the creation of jobs in underdeveloped regions among historically disadvantaged people over the next three years and will help in the smooth implementation of broad-based black economic empowerment in the SME sector, says the IDC.
"The Risk Capital Facility was designed to support sustainable employment creation and economic empowerment for previously disadvantaged people. Despite notable challenges, the successes of this programme have allowed us to favourably consider funding for a similar initiative in the years ahead," said EU Ambassador Lodewijk Briet.
Geoffrey Qhena, IDC's chief executive, said that the initial programme had received praise from all stakeholders when it was implemented because it provided funding for many deals.
"The Risk Capital Facility channels donor funding from the EU to deserving South African investments in response to the development needs and fascinating opportunities for economic growth," he said. - With I-Net Bridge