Small business owners have welcomed the progressive new initiative by SEDA to fund much needed technology for SMMEs.

Find out if your business qualifies by visiting the SEDA website http://www.seda.co.za

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SA's rural poor are set to benefit from an agreement between India, Brazil and SA on the exchange of technologies intended to assist small businesses.

SEDA, government's small enterprise development agency, has earmarked initial funds of R14m for the acquisition of technology predominantly for the benefit of small and microenterprises operating in the second economy.

The small business development agencies of the three countries, which have a co-operation agreement in place in terms of an initiative dubbed the India, Brazil and SA (Ibsa) forum, recently held a trinations summit in Durban with the aim of strengthening the linkages between these agencies and fostering co-operation in the area of small business development.

Like SA, Brazil and India are trying to fast-track the development of their economies to alleviate poverty and grow employment.

A technology working group was set up at the summit to facilitate an exchange of technologies between the three countries that could benefit small and microenterprises, says Charles Wyeth, head of the Seda technology programme.

Identified as priority areas are businesses operating in sectors that are also seen as strategic in terms of the trade and industry department's new industrial policy. These include agribusiness, clothing and textiles and other manufacturing businesses, which fit in with government's aim to advance beneficiation.

According to Wyeth, technology development is far more advanced in India and Brazil than in SA, particularly in the area of rural development. "These countries have many different products suitable for small-scale farming and there is now a real opportunity for us to access that technology at significantly lower costs than is available locally."

Particularly attractive is technology developed in India for the processing of small quantities of product for niche sectors of the export market. SA traditionally uses processing technology better suited to large-scale farming operations.

Obtaining technology that is small business-friendly would facilitate the establishment of small-scale farmers and lower input costs for these operations, opening up export opportunities that did not previously exist, Wyeth says.

A technology transfer fund has been set up for the programme, which disburses money in the form of a grant for the acquisition of technologies to improve efficiencies, productivity and profitability.

While the fund is only capitalised to the tune of R14m, the programme will track the impact of the fund to motivate to the trade and industry department and treasury when it feels funding should be increased.

The value of grants varies between R250000 and R450000, with funding capped at R500000.

In its first year the programme received 93 applications. Applications are assessed in terms of geographical location, maturity of the business and skills level, the goal being to maintain an 80/20 balance of allocations in favour of enterprises operating in the second economy.

Wyeth says the programme includes an elaborate set of criteria to ensure that allocations to second economy enterprises are prioritised.


Mathabo le Roux
Business Day
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