Pretoria: Trade, Industry and Competition Minister Parks Tau has published the Draft Transformation Fund concept document for a 30-day public commentary period, inviting members of the public and interested parties to provide inputs and comments from March 20 until May 7.
According to South African Government News Agency, the fund aims to consolidate Enterprise and Supplier Development (ESD) funds to enhance the participation, transformation, and sustainability of black-owned enterprises within the economy. Minister Tau emphasized the opportunity for the seventh administration to collaborate with the private sector to boost the economic participation of black-owned and managed enterprises, including small, medium, and micro enterprises (SMMEs) and cooperatives. This initiative seeks to improve their access to financial and non-financial support, aligned with the requirements of the B-BBEE Act.
The current administration anticipates aggregating R100 billion through a joint government-private sector effort. This move is part of the broader Vision 2030 of the National Development Plan, which aims to eliminate poverty and reduce inequality. Minister Tau highlighted the constitutional imperative to advocate for equality and redress, further emphasizing the fund’s objectives: promoting economic transformation for meaningful black economic participation, improving access to funding for black-owned enterprises, empowering these enterprises in key economic sectors, and mobilizing financial resources from both private and public sectors under B-BBEE legislation.
Minister Tau reassured that the fund imposes no additional requirements beyond the existing B-BBEE policy. The policy requires entities to contribute 3% of Net Profit After Tax (NPAT) through ESD for developing black suppliers, industrialists, and SMMEs to broaden the country’s industrial and services base. The Transformation Fund aims to enhance partnerships between established and emerging businesses and diversify suppliers within value chains as per the B-BBEE Codes.
Special focus will be on businesses owned by women, youth, and people with disabilities, particularly those in rural and township areas. These groups historically face significant barriers to economic participation, and the fund aims to address challenges of unequal access to resources and opportunities. Minister Tau stressed the importance of their involvement in sectors like manufacturing, agriculture, and tourism for stimulating economic activities nationwide.
The fund will also establish governance structures ensuring accountability, transparency, and efficiency. A Special Purpose Vehicle will be formed, accountable to an Oversight Committee and a skilled board. During the commentary period, sessions with stakeholders will be held to raise awareness and gather more input.