The role of local government in supporting entrepreneurship and SMME development: the case of Mangaung Metropolitan Municipality
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Date
2016-01
Authors
Thekiso, Lehlohonolo E.
Journal Title
Journal ISSN
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Publisher
University of the Free State
Abstract
The objective of the empirical study was to understand what the municipality is doing to address challenges of economic growth and unemployment, increase in income levels of local citizens, enabling people to pay for services, and enabling local government to provide more and better services through entrepreneurship and SMME development.
The role of local government in promoting economic growth, job creation, alleviation of poverty and maintaining a reasonable standard of living for local residents and communities, is further expressed in a number of policy frameworks formulated by the South African government, positioning local government to become developmental and initiate local economic development policies aimed at addressing challenges of poverty, unemployment and inadequate resources
The Constitution of the Republic of South Africa, 1996 (Act 108 of 1996), empowers the municipality to “structure and manage its administration, budgeting and planning process to give priority to the basic needs of the community and to promote the social and economic development of the community”.
It is against this background that it was important to understand what the metropolitan municipality was doing to attain market and public confidence, identify factors the municipality identified as providing competitive advantage and exploiting them accordingly, identify instruments used to attract private sector investment and identify instruments used for enterprise support by Mangaung Metropolitan Municipality.
The most important findings of the study are:
* The Mangaung Metropolitan Municipality is building economic infrastructure by creating Agri Park in Thaba Nchu and rejuvenating its CBD’s and providing commonage land to small scale farmers for animal grazing. The aim is to boost business so that economic growth is stimulated, public and private sector investments are attracted and employment is created. Furthermore, the study reveals that the Municipality offers no rebates to SMMEs on rates assessment charges, sewerage charges, refuse removal charges, water consumption charges and electricity charges.
* The municipality is still to carry out a task describing its own competitive edge in relation to other local municipalities and metropolitan municipalities, to plug leaks in the its local economy, that cause money to fail to circulate in the its local economy but exits to other regional economies. Such a competitive advantage, once identified and described, may help bring about marketing strategy to promote and advertise the local Municipality as the place to be for industries, businesses and people with appropriate skills.
* The municipality aims at attracting public and public sector investments by bringing about the spatial integration and reducing the separateness of Botshabelo and Thaba Nchu from Bloemfontein through establishment of the industrial area on the N8 route between Bloemfontein and Botshabelo andThaba Nchu. Secondly, by implementing Integrated Transport Network to improve Public Transport Network and building public transport shelters. Thirdly, by tarring and paving gravel roads, resurfacing and re-sealing existing roads and installing storm water drainage pipes.
* The municipality supports the SMMEs by contracting them to do waste removal and cleaning of CBDs and further establishes waste drop off areas to encourage and promote the re-use and recycling of waste products. It supports the SMMEs in the tourism sector by promoting Naval Hill, Maria Moroka Game Reserve, resorts, dams, cultural and historical sites, monuments and museums.
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Keywords
Local economic development, Small medium micro enterprises, Integrated development planning, Economic development and job creation, Dissertation (MGT (Governance and Political Transformation))--University of the Free State, 2016