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A solid 54% of South African business owners feel confident about their business prospects, research from Sage reveals.
Anton van Heerden, MD and executive vice-president, Africa & Middle East at Sage, unpacks the results of the study.
Following the annual World Economic Forum (WEF) in Davos, economic inequality is once again on the agenda for the world’s leaders. Theresa May, the Prime Minister of the UK, for example spoke about addressing the concerns of people around the world who have been “locked out and left behind” by globalisation and the modern economy.
Sadly, as Sage CEO Stephen Kelly noted, the Small & Medium Businesses that hold the key to job creation and prosperity are in fact, locked out and left behind by forums like Davos and others.
Small businesses create life-changing opportunities for ordinary people–helping them to put their children through school and university, pay their bonds, feed their families and, ultimately take charge of their financial futures.
The good news is that even in uncertain political times and when feeling neglected by government policy, small businesses are resilient and their owners are determined to make a difference. Our research indicates that:
* 54% South African respondents are confident about their prospects in the next six months.
* 43% said that they had no plans to change their business plans because of global political events.
* Their greatest concerns are currency exchange rates (45%), inflation (43%) and interest rates (28%) — macroeconomic challenges that aren’t easily addressed in today’s volatile climate.
* 26% feel that the exchange rate and access to funding (20%) will create the biggest challenge for their business in 2017.
Yet there are many steps government policy makers can take to help entrepreneurs and nurture their confidence. Incentives such as tax breaks, a more favourable regulatory environments and a simpler tax regime are just some of the ways that could prove to be a positive method in boosting the confidence of small businesses.
We believe that the private / public sectors need to work together to invest in and support small businesses and cooperatives to reduce the levels of poverty in South Africa. The right kind of support from government could give entrepreneurs the faith in the economy to invest more and change the path of the local economy. Consider exporters – how could we boost them through tax incentives, for example?