29 July 2015.

1. "Inculcating a culture of entrepreneurship among the youth, to eradicate poverty and unemployment“ Programmes offered to the youth by the Department of Small Business Development, with particular focus  on the youth related proposals in the NDP Youth Roundtable Discussions – The Role of the Legislative Sector in ensuring that the Objectives of the NDP relating to Youth are achieved. 29 July 2015.

2. Structure of the Presentation • Objectives of the DSBD focus on Youth Enterprise Development • Rationale of the DSBD focus on Youth Enterprise Development • Alignment to the Department’s overall vision/mission • How the DSBD focus on youth Enterprise Development is linked to the National Development Plan Objectives • DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment • Challenges/Areas of improvement

3. Objectives of DSBD Youth focus on Economic Participation through Enterprise and Small Business Development • Conduct research and development of youth enterprise policy instruments and their implementation. • Provide leadership the development of unique and specific Youth Enterprise programmes. • Roll out of Commitment 5 from the Youth Accord: Youth Entrepreneurship and Youth Cooperatives • Ensure coordination and inter-governmental collaboration with respect to youth enterprise development. • Become a focal point to account for progress on the development of youth enterprises in the economy. • Conduct quarterly, annual, and 10 year reviews and impact assessment of the youth Enterprise Development Strategy (YEDS) and its programmes, as well as the performance of youth enterprises in the economy as measured by contribution to GDP.

4. Rationale for the DSBD focus on Youth Enterprise Development • The Department of Small Business Development (DSBD) realizes that youth between ages of 16-35 years own approximately 33% of all businesses in South Africa . • It also recognizes that about two thirds (63%) of youth entrepreneurs are self-taught or acquired their skills from spouses (14%) . • Furthermore, less than 2% of the youth entrepreneurs reported tertiary institutions as a source of skills and training . • Over 80% of youth owned enterprises are not registered . According to the classical definition these businesses will be regarded as informal, but from a perspective of their level of sophistication they are not. Therein lies the dilemma and the DSBD through the development of its Informal Sector Business Development Strategy is attempting to modernize these businesses, and through organic growth steer them towards to formalization, and also towards other mechanisms available at the Department to promote their growth and expansion.

5. Rationale for the DSBD focus on Youth Enterprise Development (cont.) • Given the preceding facts, the Department is developing unique programmes/instruments aimed specifically at addressing gaps in youth enterprise development or creation. • Furthermore, the Department is mainstreaming existing DBSD programmes and instruments, like the Black Business Supplier Development Programme, to ensure we reach our youth enterprises.

6. Alignment to the Department’s overall vision/mission Vision: ‘A radically transformed economy through effective development and increased participation of SMMEs and Co-operatives in the mainstream economy’. We are focussing developing unique programmes to upscale and fast-track the participation of youth in the mainstream economy such as the Mass Youth Enterprise Creation Programme (MYECP). Mission: To create a conducive environment for the development and growth of small businesses and cooperatives through the provision of enhanced financial and non-financial support services, competitiveness, market access, promotion of entrepreneurship, advancing localisation and Leveraging on public and private sector procurement. We are developing instruments that address both the financial (Youth Business Development Scheme) and non financial needs (Mentorship, Incubation, etc.) of youth, to create and expand economic opportunities for youth enterprises, be they start-up, survivalist or growth oriented

7. How the DSBD focus on youth Enterprise Development is linked to the National Development Plan Objectives • The DBSD focus on Youth Enterprise Development is largely guided by the National Development Plan and Outcome 4 of the Medium-Term Strategic Framework (MTSF), which calls for the creation of decent employment through inclusive economic growth. • The Draft National Youth Policy 2015-2020, which enjoins all spheres of Government to mainstream youth economic development in particular and youth development in general provides the parameters (socio-economic and contextual) within which programmatic interventions are defined. • The National Small Business Act of 1996 provides the full range of enterprise development options that can and will be applied to the youth sector. • The broad legislative framework is integrated into the DSBD’s Youth Enterprise Development Strategy (YEDS) that focuses on providing support schemes for young entrepreneurs with the objective of creating and managing sustainable and efficient youth businesses that are capable of providing decent permanent jobs and employment growth, ensures that the Youth business plan supports the Departmental mandate.

8. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment • Mass Youth Enterprise Creation Programme • Youth Mainstreaming through transversal agreements • Sector specific Youth Catalytic Projects • High Impact Youth Month Short Term Projects • Youth Enterprise DevelopmentWorkshops • Youth Financial Support Instruments

9. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (1) • The Mass Youth Enterprise Creation Programme - a flagship programme designed to engage young entrepreneurs over 24 months, whilst providing a 12-month Seta accredited entrepreneurship certificate, development of a business plan, sourcing of funding, business launch and post programme support. The aim of this programme is to aid the creation of jobs through entrepreneurship and the creation of sustainable youth owned enterprises. This programme is directly called for in the NYP 2015-2020 (Pg 24) that calls or the DSBD to develop and implement such a programme. • The DSBD also recognises this programme as a its contribution and fulfilment to commitments of the Youth Employment Accord (Commitment No 4), which calls for government’s support for youth entrepreneurship and co-operatives, which will also address youth unemployment and the limited participation of young people in the economy

10. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (2) • Youth Mainstreaming Programme - Nine Economic Cluster Departments, 9 Provincial Departments of Economic Development and 11 State Owned Enterprises will be capacitated in a mainstreaming framework and reporting template – thereafter monitored mainstream on a quarterly basis to ensure that 30% of their services/programme beneficiaries are youth, and even more importantly, 30% of their procurement spend is be directed to youth enterprises

11. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (3.1) • Sector Specific Catalytic Programmes - These projects create higher impact through leveraging on existing opportunities in the priority Sectors and Infrastructure Development Programmes of Government as expressed in the Industrial Policy Action Plan (IPAP) and the Regional Industrial Development Strategy. Project 1: The Department noted that Energy is one of the priorities of Government as stated by the President of South Africa Mr Jacob Zuma in his State of the Nation Address (SONA - 2014) and responded by initiating a programme with the Department of Energy, focussing on establishing youth cooperatives in the rural Eastern Cape and Kwa-Zulu Natal that were trained in the installation, maintenance and repair of solar heating geysers. Eight youth cooperatives were trained at the Engcobo, Mbashe, Ubuhlebezwe and Ingwe local Municipalities in the technical skills to install, repair and maintain solar water heating equipment, as well as business skills to run a cooperative enterprise.

12. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (3.2) • Sector Specific Catalytic Programmes - These projects create higher impact through leveraging on existing opportunities in the priority Sectors and Infrastructure Development Programmes of Government as expressed in the Industrial Policy Action Plan (IPAP) and the Regional Industrial Development Strategy. Project 2: In recent years there have been conflicts between the South African spaza shop owners, community members and the foreign spaza owners. “Foreign entrepreneurs have been able to wrestle a large share of the spaza market away from South African, forcing less competitive (mostly South African) spazas out of business. By operating in more collective ways, these immigrants are able to offer cheaper prices and hence come to dominate the sector” In order to minimise the above mentioned challenges by young people in the townships, the Youth Directorate will initiate the project of spaza youth cooperatives. The spaza youth cooperatives will be assisted with registration, training and access to markets. This project will be implemented in Gauteng province as a pilot. The spaza shops provide a vital service to the people living in under-resourced communities. Using the Cooperative model, this can improve the lives of youth, and their economic conditions in the townships.

13. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (3.3) • Sector Specific Catalytic Programmes - These projects create higher impact through leveraging on existing opportunities in the priority Sectors and Infrastructure Development Programmes of Government as expressed in the Industrial Policy Action Plan (IPAP) and the Regional Industrial Development Strategy. Project 3:. Government has R2.9 billion ring fenced for digital migration which will be implemented from June 2015. Over 5 million poor households will be subsidized. The Satellite Television Boxes (STBs) are to be manufactured in SA. The project focuses on the establishment of at least 40 youth-owned cooperatives outlets (branded by Altech) in townships and rural areas in four different provinces to benefit from this rollout by providing the necessary installation, sales and technical maintenance skills to service this rollout. This will result in the employment of at least 500 youth that will benefit directly from the digital migration programme of Government.

14. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (3.4) • Sector Specific Catalytic Programmes - These projects create higher impact through leveraging on existing opportunities in the priority Sectors and Infrastructure Development Programmes of Government as expressed in the Industrial Policy Action Plan (IPAP) and the Regional Industrial Development Strategy. Project 4:The project seeks to support Youth owned co-operatives in the Cape Flats and surrounding regions, i.e. Khayelitsha, Gugulethu, Mandalay, Mitchell’s Plein, Langa, Nyanga, Strandfontein, Greenfields etc. to operate Shisha Nyama Franchise stores. Youth owned co-operatives will be established by young people who may be interested in this opportunity; existing co-operatives will also be considered. In implementing this project, the DSBD is working the Cape Town Office of the NYDA and relevant provincial stakeholders to implement the project with an inclusive BDS support package being offered to these youth cooperative franchise enterprises.

15. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (4) • High Impact Youth Short Term Projects -Youth Month Commemorations – June 2015 - The youth of 1976 fought for the creation of a democratic state and for freedom, today’s youth activism is focussed towards successfully tackling constrains of economic freedom, reducing poverty, unemployment, HIV and AIDS, personal development and the development of the country . During this month we encourage our youth to understand the conviction of the generation of 1976; we pay homage to their sacrifices and pledge to carry on their legacy and principles of selflessness, determination and devotion to freedom that were necessary for the successful transition to a democratic South Africa. Programme 1: Youth Enterprise Day (Mpumalanga, Dr JS Moroka District) – 05 June 2015 Programme 2: Youth Enterprise Day (Limpopo, Sekhukhune District) – 12 June 2015.

16. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (5) • Youth Enterprise Development Workshops -The workshops provide the provincial stakeholders with an opportunity to understand the focus and programmes offered by the DSBD that will benefit youth enterprise, and also assist provincial stakeholders to align their youth enterprise strategies with the Youth Enterprise Development Strategy (YEDS) and DBSD Flagship programmes, like the Mass Youth Enterprise Creation Programme (MYECP) and Youth Mainstreaming Programme. These Youth Enterprise Development Workshops through which key/flagship youth programmes of the DSBD can be implemented in all provinces of the country simultaneouslyare held on a quarterly basis. The key aim of these workshops are to enable collaboration and the establishment of strategic partnerships with provincial stakeholders to enable us to work together in order to address the needs of young people in relation to Enterprise Development.

17. DSBD Youth Programmes that inculcate a culture of entrepreneurship among the youth, to eradicate poverty and unemployment (6) • Financial Support Instruments to Support Youth Enterprises -The strategic aim of this programme is to create funding instruments that will cater for youth enterprises, with the aim to assist them overcome their challenges of obtaining start-up, growth and expansion and collateral funding. The first of these to be launched is the Youth Business Development Scheme (YBSD) instrument which is aimed at small youth enterprises to assist them to improve their competitiveness and sustainability to become part of the mainstream economy and create employment. Twenty Million rands has been allocated to the Youth Business Development Scheme (YBSD) for the current financial year and this this funding instrument will assist to create much needed youth jobs as young people will not only create enterprises for themselves, but jobs for others as well. Furthermore, this funding instrument will assist youth-owned enterprises to acquire critical assets and equipment required to grow and expand their business operations.

18. Challenges facing the DSBD Youth Programmes • Due to budgetary constraints, key programmes that address the development of financial instruments for youth require urgent funding to get them of the ground – the Youth Entrepreneurship Collateral Fund which seeks to provide a non-refundable, once off grant to young entrepreneurs that will serve as a collateral guarantee to secure a business loan to start their own businesses is a priority. • The DSBD and Youth Enterprise Development Strategy are new and our programmes are still being developed, refined and honed to meet the needs of our youth. • We have just begun the process of coordination with the provinces and local spheres of government, and we find that there are different levels of learning and systemic gearing that need to take place in these constituencies before we can pickup the pace of delivery. • We are in constantly learning what the needs of our youth are with regard to supporting the establishment and growth of youth enterprises, and are confident that we will get our support to youth right.

19. Re a Leboga RolivhuwaSiyabonga Dankie Thank you Department of Small Business Development