Pretoria: The Department of Trade, Industry and Competition (the dtic) has announced that the Transformation Fund is a vital initiative aimed at advancing South Africa’s constitutional commitment to economic redress and inclusive growth. The department emphasized that this initiative is aligned with their mandate to promote shared equality through various legislative and other measures, specifically to empower black-owned enterprises and small, medium, and microenterprises (SMMEs).
According to South African Government News Agency, the fund is deeply rooted in Section 9(2) of the Constitution and is designed to reflect the Government of National Unity’s (GNU) intent to foster redress and inclusive economic growth. The department stated that the GNU’s transformative agenda is focused on removing systemic barriers to economic participation, ensuring historically-disadvantaged communities have equal opportunities across all sectors of society.
In addition to its constitutional foundations, the fund is anchored in the Broad-Based Black Economic Empowerment (B-BBEE) Act, particularly Section 2(h), which mandates the government to enhance the economic participation of black-owned and managed enterprises, including small, medium, and micro enterprises, through financial and non-financial support. The fund aims to address these priorities by promoting compliance with B-BBEE requirements and unlocking opportunities for sustainable growth.
The Transformation Fund is also aligned with the National Development Plan’s Vision 2030, supporting Outcome 4, which focuses on decent employment through inclusive economic growth. Furthermore, it is consistent with the department’s Medium-Term Development Plan (MTDP) 2024-2029, emphasizing job creation and inclusive economic participation as per the revised Annual Performance Plans (APPs).
The fund’s objectives include promoting economic inclusion by providing support to black-owned enterprises, addressing resource fragmentation, fostering growth in high-impact sectors, enhancing market access for beneficiaries, and supporting South Africa’s industrial policy to stimulate growth in productive sectors and underdeveloped areas.
Minister of Trade, Industry, and Competition, Parks Tau, remarked that the Transformation Fund is not about imposing new obligations but ensuring existing commitments under B-BBEE legislation are effectively utilized. It represents the constitutional mandate to achieve equality and empower historically disadvantaged communities. The fund’s conceptual framework will be open for public consultation and stakeholder engagement, with a target to mobilize R100 billion by 2029.
The department welcomes the ongoing debate on transformation and encourages broad participation during the consultation process. Minister Tau described the Transformation Fund as a catalyst for change, aiming to create an inclusive, sustainable economy that reflects South Africa’s diversity through collaboration with the private sector, civil society, and other stakeholders.