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Date : 22/11/2006
Source: Department of Trade and Industry
Title: Thabethe: Access to Finance Report


Speech by the Deputy Minister of Trade and Industry, Ms Elizabeth Thabethe, at Access to Finance Report launch

Programme Director, Ms Ketsiwe Dlamin
i Director International Finance Corporation (IFC) Africa, Mr Thiery Tanoh
Ambassador of the Swiss Confederation in South Africa, Mr Viktor Christen
Head of the Gender and Women's Empowerment
Unit of the Department of Trade and Industry (dti), Ms Mmabatho Matiwane
Government Relations and International Affairs Officer of the Johannesburg Securities Exchange (JSE), Ms Pearl Moatshe
Officials from IFC and JSE
Officials from the dti
South African Woman Entrepreneurs Network (SAWEN) members
Women in Business
Ladies and gentlemen
Welcome.

Good morning to you all. It is indeed a great honour for me to finally be able to be a part of this launch. Seeing it happening gives me great pleasure. It's been really hard work for the stakeholders involved and us to conduct and compile the study. The work is impressive and the contents, in particular the conclusions, are critical. The work is critical to us as the dti and the women of South Africa as we need to come up with immediate interventions to facilitate women's easy access to financial markets, for these financial markets largely contribute to the limited economic empowerment of our South African women. As much as this is an international phenomenon, we as the South African government and the dti in particular are committed to engage with this challenge in whatever way we can. This is the reason we have conducted the study; to gain a deeper understanding and better insight into the intricacies involved to position us to tackle this problem.

Ladies and gentlemen, as already stated in my foreword, it is my personal and professional belief that facilitating equitable and easy access to finance is key for us to unlock the entrepreneurial potential amongst South African women. Fortunately, this view has been well supported by women from all over the country who have actively participated in our consultation drive as part of developing the draft National Strategic Framework on Gender and Women' Economic Empowerment. It is no secret that, historically, the South African financial markets, both from the public and the private sector, have and continue to be gender blind and thus a major obstacle for women to start, grow and strengthen their enterprises. This happens to be the case with the traditional banks, our very own dti financial institutions and the micro-lenders. In all their interaction with women, all of these institutions continue to have lending conditions that are unfavourable to the majority of South African women owning and managing small to medium size enterprises. This is a situation that, if not attended to, can negatively affect our economy by continuing to fail to attract new entrants to the economy as set by our current national economic objectives.

Ladies and gentlemen, on 12 January 2006, the Deputy President, Ms Phumzile Mlambo-Ngcuka, clearly stated, “For Accelerated and Shared Growth Initiative for South Africa (AsgiSA) to fully achieve its objectives of halving unemployment and eradicating poverty, women's participation and representation must be mainstreamed”. She continued to say, “If AsgiSA does not work for women, it simply won't work for South Africa.”

As much as this statement might sound a bit controversial to some of you, it serves as a serious caution to all those committed to grow the South African economy. In accelerating and facilitating the sharing of the growth of our economy lays the issue of access to finance for small to medium sized enterprises irrespective of the gender and race of the owners.

Ladies and gentlemen, as women continue to account for more than 52% of the country's population, mainstreaming their participation and representation is a business imperative, thus an economic imperative. Currently our recipe to grow and diversify our economy lacks key ingredient women. It is on this basis that there is no way that we can be complacent around some of the facts raised in the report, which notes: “In the Financial Sector Services Charter, the financial sector is characterised by low levels of participation, meaningful ownership, control, management, as well as high level skilled positions occupied by black women”.

It is unacceptable for the Financial Charter not to have all elements of the Black Economic Empowerment (BEE) scorecard that go beyond Human Resource (HR) issues as is currently the case. As the lead department on BEE issues, clearly an immediate intervention is needed for us to change the low participation and representation of women in BEE initiatives, including entering into deals, and accessing the right skills and procurement opportunities. Without easy, and I want to emphasise, affordable access to finance by our women, BEE procurement opportunities and all the quotas that have been set aside for women in different charters will remain on paper. We as government can only do so much in preparing a favourable environment for our women through policies; the actual power to make this possible is in the hands of those who can implement, like the financial institutions.

Ladies and gentlemen, as much as the actual power lies with those financial institutions, I would be failing in my duty as a woman Deputy Minister of Trade and Industry to shy away from the responsibility of mentioning the role and responsibility those women themselves have within the financial market. As Patrick Hoerler has said, "one of the main obstacles to obtaining financing is the ability of small and medium businesses to present a proper business case to potential financiers".

For South African women to succeed in growing their businesses, they must go out and seek support from relevant institutions so as to be able to meet the needs of the financiers. This means shying away from using the so-called “sophisticated consultants”, but rather to be part of a training programme to enable those women business owners to acquire direct skills.

With these few words, I wish to thank the IFC, Fin Mark Trust, the Swiss Confederation in South Africa, and all the consultants who did all the hard work. Without your contribution, our proposal would have probably remained just that, a proposal. The quality of the contents of the report being launched today is impressive. We as the dti are committed to remedy the current situation by making 2007 a positive year for women and the financial markets. We have already started and next year we will be announcing good news and major breakthroughs in terms of the interventions needed. We hope that women, banks and other financial institutions will come on board and assist us in growing our economy so that together we can halve unemployment and reduce poverty. The study points us in the right direction for doing this.

Issued by: Department of Trade and Industry
22 November 2006

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