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The South African community-based small business cooperatives sector is expected to benefit from a recently signed memorandum of understanding between the Department of Small Business Development and the German Cooperative Raiffeisen Confederation (DGRV).
The department today briefed the Portfolio Committee on Business Development about the MOU with the German cooperative, which aims to facilitate job creation through supporting and capacitating communities, officials and groups for development of viable and sustainable cooperatives.
In a prepared presentation to the committee, Mr Vukile Nkabinde, the department’s Director for Cooperatives Business Support, said the aim of the MOU is “to ensure responsive local government that is effective, efficient and economically able to promote local economic development – through coordinated facilitation and delivery of capacity building, technical and institutional support to municipalities working with co-operatives, government development agencies and sector departments, to achieve an outcome-driven local economic development that empowers all role players to actively contribute to inclusive local economic development and sustainable communities.”
The two parties also agreed to formalise their relationship and desired strategic partnership and their respective responsibilities regarding the support of municipalities to develop cooperatives through capacity building and other support measures to ensure growth and sustainability of co-operatives and communities.
The agreement will also further the development of co-operatives through capacity building, technical and institutional support measures. There will also be collaborations with other partners to support the existing co-operatives that have scope for growth and growing local economies through capacity building, technical and institutional support.
The committee welcomed the initiative and hoped it would help revive many cooperatives that have been struggling to survive, especially those that receive government funding. “Some of them are no longer operational or not operating to full capacity. They are dying because of lack of assistance from the government. The department must come up with plans to capacitate these cooperatives, especially in townships and rural areas,” said committee member Ms Babalwa Mathulelwa.
However, the department said an assessment of cooperatives supported by government found that 80 per cent of them are still operating, though not on full capacity. “A lot of them are not doing their annual returns and this creates an impression that they are not operating,” said Mr Nkabinde.
In welcoming the department’s presentation and the partnership with DGRV, the Chairperson of the committee, Ms Violet Siwela, said: “This is promising. Our intention is to see the cooperatives surviving and lifting our people out of poverty and hunger.”
Sakhile Mokoena
7 Wednesday 2023
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