Township Economy

This article discusses the role of small, micro, and medium enterprises (SMMEs) in South Africa's economy. SMMEs are seen as a potential solution to the country's economic challenges, such as low growth and high unemployment rates. They are expected to create job opportunities and contribute significantly to the GDP. Globally, SMMEs make up over 95% of enterprises and employ 60-70% of the working population.

However, the current reality in South Africa presents a different picture. The SMME sector in the country offers untapped market potential for economic growth through funding opportunities and corporate supplier development. The National Development Plan set ambitious targets for SMMEs, aiming for them to contribute 60-80% to GDP growth and generate 90% of the 11 million new jobs envisioned for the country by 2030.

Despite these aspirations, South Africa continues to struggle with high unemployment rates. In the fourth quarter of 2018, the official unemployment rate stood at 27.1%. However, considering a broader definition of unemployment, the figure exceeds 35% of the total population.

In summary, while SMMEs are recognised as a crucial driver of economic development and job creation in South Africa, the country still faces significant challenges in achieving these goals, as reflected in persistently high unemployment rates.

A sponsored supplement to the Mail & Guardian about township economies.

Abstract based directly on source.