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Red tape ‘killing’ small business — Davies wants more

SMALL business activity in South Africa is in a miserable state, a new survey has found. It warns that entrepreneurship in South Africa is at its lowest level in three years, with dire implications for hopes of the sector creating thousands of new jobs. South Africa BusinessThe latest Global Entrepreneurship Monitor report found less than 14% of South Africans surveyed planned to start a business within the next three years. It also found "total entrepreneurial activity" fell to 7.3% last year, from 9.1% in 2011 and 8.9% in 2010. The gauge measures the percentage of the population of working age about to start a business, and those having started one up to three-and-a-half years ago. South Africa’s entrepreneurship activity compares unfavourably with similar countries, such as Argentina, Mexico, Malaysia, Brazil and Russia. Youth in South Africa also trail their sub-Saharan African peers. Alongside 10 other sub-Saharan countries — among them Nigeria Angola and Ghana — only 39% of SA’s youth feel there are business opportunities available to them. The figure is close to 70% in other African countries. The conclusions make grim reading for the authors of the National Development Plan, which hopes small-to medium-sized businesses will provide 90% of jobs created in South Africa by 2030. Among the reasons cited for the bad showing were onerous labour laws, crime, corruption and a poor healthcare system. Smaller businesses often found working with hospitals was very difficult because of a lack of available equipment. The findings came as Trade and Industry Minister Rob Davies on Tuesday lambasted critics of his draft Business Licensing Bill in Parliament and insisted it was not the intention to impose more bureaucratic hurdles on small business. The bill aims to require all businesses, regardless of size, to obtain a licence from their municipality. Failure to do so could see the offender fined or jailed for up to 10 years. Mr Davies said the aim of the bill was to weed out illegal operators. Existing informal traders and small businesses were subject to increasing competition from illegal traders who sold illicit goods, failed to pay VAT and employed people illegally. Source: http://www.bdlive.co.za/business/2013/04/24/red-tape-killing-small-business--davies-wants-more

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