Small Business Development and Poverty Alleviation in Alexandra, South Africa

Give a man a fish and you feed him for a day; teach him to fish and you feed him forever (Chinese proverb).

It is clear that since 1994 a turning point in the policy-shaping the South African small business sector has seen the increased participation of the private sector and local communities. However, over the year the most significant development in the sector is the pivotal role allocated by both the government and the private sector to small, medium and micro enterprises (SMMEs) in poverty alleviation and transformation processes. The paper critically assesses the role of the small business sector in poverty alleviation in Alexandra and to examine both government and private sector initiatives for supporting small business development for poverty alleviation.

It is observed that small businesses are not playing the expected role due to a number of constraints including a lack of policy that deals adequately with the semi-formal and informal business sectors, the predominant sectors in Alexandra. There is also a shortage of small business development agencies that would help in developing a culture of entrepreneurship and business management skills. The overall finding indicates that with positive interaction between development agencies, and small businesses in Alexandra, predominantly informal and semi-formal SMMEs in Alexandra could not only alleviate poverty but could also contribute to the general transformation process.

Abstract based directly on the original source