Over the years, Gauteng Provincial Government has placed much emphasis on the restructuring and development of Township and Rural Economies. These economies have long been overlooked in both policy and legislative initiatives.

Province is actively building and accelerating the Economy with the development of multi-tier industrial economic zones across all of the Gauteng City Region as captured in the Gauteng vision 2030 #GGT2030.”

Thriving township economies are essential for the realisation of human rights, dignity and equality. These go in whole with providing a better socio-economic disposition. The draft Gauteng Township Economic Development Bill intends to do just this and will change how townships are regulated and governed to transform them into zones of widespread job-creating commercial activity. The scope of the bill is framed by research.

Some of the objectives of this bill are:

• Provides a regulatory framework which makes it possible for people living in townships to establish viable and thriving business, enterprises, small enterprises, small enterprise organisations and co-operatives where they live;
• Introduces an enabling framework to ensure that retail malls and supermarkets that are township-based partner with local township-based enterprises, including the sourcing of some of the products and services from local township-based producers, service providers and manufacturers;
• Establishes specific procurement rules and programmatic support that allows government and its main contractors―
  • to buy from a large group or groups of township-based enterprises, with systems linking them so they can supply as if they are one large enterprise;
  • to compel enterprises that obtain government contracts to spend a certain percentage of their procurement spend on township-based enterprises or entrepreneurs and co-operatives.
• Provide an enabling environment for municipalities to―
  • develop taxi ranks into micro central business districts and to support the taxi economy to use its scale to grow supporting value chains and industries;
  • support the development and promotion of a township-based real estate development model to convert areas with high commercial densities into township high streets; and
  • promote and support the development of representative associations of township-based enterprises and non-profit organisations.

The research informing the bill identified a need for funding partnerships to reach SMMEs that have the potential to expand and grow. The province has so far established an SMME fund to provide both wholesale and blended finance (in which the fund acts as first-loss guarantor) to intermediaries that can derisk lending to township-based firms. Gauteng government and Industrial Development Corporation have each committed R250m to the fund, which will aslo mobilise private sector participation. The fund supports the most inclusive, most scalable way of creating access to finance across unbanked and underbanked township based SMMEs.”

There will also be separate funds for the township backyard real estate and taxi economy initiatives. Backyard real estate talks to how the bill will introduce a transparent process to enable people or businesses with entrepreneurial plans to acquire the land either by leasehold or outright purchase. Some of these properties lend themselves to become office parks, and others light manufacturing. The taxi economy initiative highlights the need to promote incentives for municipalities to develop taxi ranks into micro-CBDs, enabling the taxi economy to use its scale to grow supporting value chains and industries.

The Gauteng Township Development Fund will be managed by a newly established board that will work with the Gauteng Enterprise Propeller (GEP). 

Copies of the draft bill can be downloaded on the GEP portal.