Franchising may offer solutions to help drive growth, boost employment
Franchising presented a good opportunity for South Africans to spur economic growth to meet government’s targets of reducing employment and bridging the gap between the informal and formal economy, the Presidency said on Thursday.
Speaking at a US – Southern Africa franchising forum, in Sandton, an economic advisor to Deputy President Phumzile Mlambo-Nqcuka said that franchises were a way to bring people from the informal, or second, economy into the formal economy, which could help South Africa to meet the goals of its Accelerated and Shared Growth Initiative.
“Franchising is one of those mechanisms which can bring people from outside the mainstream economy into it,” she said.
Nonhlanhla Mjoli-Mncube pointed out that government was investing more than R420-billion to ensure that South Africa provided an attractive environment in which to do business.“Whether you are a South African investor that wants to go into the rest of the continent as a franchisor or you are an investor wanting to come into South Africa, the road it is going to be smooth,” she urged.
“We are also spending a lot of money to improve skills in South Africa, and especially on training youth,” stated Mjoli-Mncube. South Africa’s skills shortage was perceived to be a major inhibitor to economic growth in South Africa.
Mjoli-Mncube said that the South African government had identified priority areas that it would focus on developing in the economy, and added that these were directly congruous with the needs of the sectors of franchises that were going to enter the country, or had shown interest.“There are certain key areas that we have identified,” she stated. “And some of the franchises that are coming to South Africa, or are looking at coming to South Africa, link directly with the priority sectors that we have identified.”
These sectors included tourism – where she said there was “huge potential” – business processes and outsourcing, offshoring, biofuels, forestry, chemicals and education.
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