ENHANCING TECHNICAL AND MARKETING SUPPORT FOR SMALL, MICRO AND MEDIUM-SIZED ENTERPRISES

An investigation into technical and marketing assistance for SMMEs was started by Nedlac's Japanese Grant Fund (JGF) subcommittee while still under the auspices of the NEF. One of the main recommendations that emerged from the investigation was that a competitiveness fund should be established to manage and implement three support programmes for SMMEs. The programmes are summarised as follows: 

• A demand-side matching-grant scheme which would share costs with firms on a 50/50 basis for initiatives aimed at the development and implementation of strategies to upgrade a firm's competitive capabilities. Together with the promotional elements of this scheme, these matching grants would induce SMMEs to increase their demand for business services which should, in turn, induce changes in the behaviour of service providers.
• Supply-side matching grants which would comprise matching grants to suppliers of business services to SMMEs. While the report focuses on the provision of these grants to suppliers of export services, in principle the concept could be further developed to encompass non-governmental organisations (NGOs) and other suppliers of business services to the smallest firms.
• In addition to the above, the report explores options for upgrading the capabilities of manufacturing-orientated micro-enterprises. It suggests that the encouragement of linkages appears to offer the best prospects for strengthening these enterprises.

Nedlac agreed to the establishment of a competitiveness fund in December 1995. The governing board of the fund, comprising four representatives each from business, labour and government, has since been constituted. The administration of the fund is subject to the promulgation of the National Small Business Enabling Act because the definition of recipients would be contained in the Act.