Concerns about township economy
THE ANC is concerned that the provincial Department of Economic Development is not doing enough to support upcoming entrepreneurs in the townships.
Provincial ANC finance and economic opportunities spokesperson Nomi Nkondlo was reacting to a written answer from Finance and Economic Opportunities MEC David Maynier, regarding the failure of Nozinga Market, in Gugulethu.
In 2017, Nozinga was the first in the department’s Enterprise Development Programme, in collaboration with the Pick n Pay Market Store Project. The project converts existing spaza shops, or new sites within townships, into independently owned mini-supermarkets.
Since its launch, the project has opened seven new spaza stores and upgraded two existing stores, which provide employment for 177 people.
Nkondlo said the Nozinga Market ceased to operate in February and there had been no communication from the department about its failure.
“With the current situation with the Nozinga store, it is clear that when these projects hit a dead end, the department will look to find quick fixes, such as finding other entrepreneurs, instead of assisting the ones struggling to survive.
“We need the department to provide more details on its capacity building sessions, to see if the store operators have been enabled enough to manage bigger stores.
“We also need to avoid a situation where township entrepreneurs end up in a debt trap through these development loan finances,” said Nkondlo.
She had asked Maynier to explain why Nozinga’s Market had not been trading. In his answer, Maynier said the store was opened in October 2017 and ceased to trade in February 2021.
“The performance of the store could not sustain the cash flow, due to management challenges. The shortage of cash flow resulted in the store not being able to timeously settle invoices with Pick n Pay and other suppliers, which resulted in supply being stopped to the store.
“The owner went outside the Pick n Pay supply chain and could not settle these invoices. A decision was made by the owner to close the store, as the store ran out of stock,” said Maynier.
Yesterday, the legislature’s standing committee on finance, economic development, and tourism received a briefing on the department’s township economy revitalisation initiative.