As we near the end of 2020, we take stock of the current state of entrepreneurship in South Africa and look forward to the opportunities 2021 will present. Small business expert and CEO of Osidon, Hennie Ferreira, reflects on what the next year holds.
What were the biggest challenges entrepreneurs faced in 2020?
The year 2020 is synonymous with the COVID-19 pandemic but I believe the coronavirus merely shed light on the issues our economy has faced for many years.
This includes the fact that our business environment is not friendly towards start-ups and small businesses, the difficultly of doing business discourages foreign investment and businesses face overregulation as well as red tape.
What are the opportunities entrepreneurs can expect in 2021?
2020’s problems will pave the way for 2021’s opportunities. The challenges we faced over the past year have presented opportunities to come up with new product and service ideas, which can lead to the creation of new businesses and jobs.
All businesses, including small and medium enterprises (SMEs), are at the centre of rebuilding the South African economy. Businesses are the only force that can create real and sustainable jobs.
Are you positive about 2021?
Yes. Every year presents a new opportunity.
While the business environment will never be perfect, this doesn’t mean there are fewer business opportunities. Entrepreneurs have the tenacity and drive to make things happen, and should take responsibility for business and job creation.
Entrepreneurs must take the lead. For anyone with a desire to solve problems, 2021 is the year to do so.
How can government support the small business industry in 2021?
Government cannot fix the economy but it is the government’s responsibility to transform South Africa into a business friendly country, through deregulation. Businesses cannot flourish in an over-regulated environment.
Firstly, government should lower business taxes (currently 28%) to be more competitive in comparison to other countries.
Secondly, government must improve the ease of doing business in South Africa. Red tape was a burden before COVID-19, but now the situation is more desperate.
Thirdly, the biggest inhibitor to economic growth we face in South Africa is our labour environment. Unions have too much power and prevent effective labour market reforms, making business prosperity a pipe dream.
Finally, we need to encourage foreign investment in South Africa. Investment is connected to red tape – no one wants to invest in a country with too much red tape and too many inhibitors to economic growth. As the world returns to normal, investors are looking for solid opportunities to bring economic growth. Entrepreneurs stand at the ready to make these opportunities work.
This is the only way to turn the economy around in a post-Covid-19 world.