Today marks the beginning of a momentous journey in affirming practically the citizens and communities of townships and informal settlements in the Gauteng City-Region (GRC). The passing of the Township Economic Development Bill, at the Gauteng Legislature, is welcomed as an opportunity to rebuild progressively the economic geography of our townships and disadvantaged communities. 

The Bill is a significant regulatory and policy instrument to affirm citizens and communities in the GCR with meaningful classes of benefits. Overall, these instrumental benefits are geared towards, amongst others: (i) promotion of inclusive human settlements by bringing people closer to economic opportunities, (ii) develop a real commuter economy that uses taxi ranks and convert them into mini-business and commercial districts, (iii) integrate unused land, abandoned buildings and forgotten industrial estates into township value chains to turbo-charge the economic growth of the GCR, (iv) create a new economic geography through the township enterprise zones. 

This Township Economic Development Bill is a game-changer that should be supported since it facilitates a multi-dimensional way for the Gauteng Provincial Government (GPG), to change how townships are regulated and governed so that they become areas of employment-creating commercial activity. It is a progressive Bill to set up better procurement rules that allows government and contractors to buy from large groups of township-based firms. It is a progressive Bill to deploy a dedicated financing mechanism to establish an SME Fund to provide wholesale and blended finance to intermediaries that can de-risk lending to township-based firms. 

As the Gauteng Department of Economic Development (GDED), led by Premier David Makhura for this 6th Administration, we urge the private sector to join us in implementing Growing Gauteng Together 2030 (GGT2030) plan of action, now enabled by this Bill, to link township investment facilitation to value-chain transformation and SMME empowerment through active enterprise development and supplier development. 

As we have always emphasised, government needs tangible and meaningful industry support in order to build an inclusive consumer economy in township areas so that we collectively generate thousands of new employment opportunities even in the gig economy. We urge the private sector to partner with government to develop the commuter taxi economy that services around 6-million commuters every day. We encourage the private sector to come on board to explore and maximise opportunities in the backyard shacks economy which is home to 4-million people so that they can build flats and small businesses that eventually become township high-streets.

Additionally, the Township Economic Development Bill is welcomed since it is a legislative and programmatic policy mechanism to create an economic geography for mushrooming of the township enterprise zones. In these zones, there is space to implement “benefit stacking” which simply means stack in these zones all the benefits for people and businesses to access such as funding, procurement, better by-laws, tax breaks, and dedicated programmes. 

These benefits in these zones means that township businesses, formal and informal, will be enabled to faster and cheaper to be fully-licensed to operate, to access benefits available in the mainstream economy, to gain access to new markets linked to both government and big business. 

The by-laws enabled by this Bill also makes it easier to incentivise the installation of broadband in township enterprise zones and empower township-based internet service providers. This is a central and strategic intervention, enabled by this Bill, to the creation of potentially thousands of jobs in the gig economy and through the global business services sectors. 

What is equally important to note is that this Township Economic Development Bill enables the Township Economy Partnership Fund to become legally-binding for all future Gauteng governments. This presents policy certainty and legal continuity to support SMMEs which are the lifeblood of the economy. The Partnership Fund is an instrument to support SMMEs through blending government money with private sector money working with smart platforms or intermediaries to run portfolios of loans to SMME operating in the township economy. 

As the Gauteng Provincial Government, once again, we welcome the passing of the Township Economic Development Bill as indeed a new deal and legal mechanism to rebuild back better township economies in this post-pandemic trajectory. 

 

Issued by The Gauteng Department of Economic Development, Agriculture, Environment and Rural Development