SMME INCLUSION IN THE JUST TRANSITION

Focus Group: Opportunities and Barriers for SMMEs in Just Transition towards a Low Carbon Economy
Sector Focus Area: Sustainable waste management

As the global community increasingly prioritises the transition to a sustainable and equitable economy, the imperative to ensure the inclusion of small, medium, and micro enterprises (SMMEs) becomes paramount. Within this context, empowering youth and female-owned SMME newcomers in green industries emerges as a pivotal strategy for fostering just transition inclusion. This paper explores the business challenges and opportunities faced by SMMEs owned by marginalised groups such as youth and women as they navigate the transition to greener practices and industries. Drawing on a review of existing literature and case studies, the paper identifies key SMME business barriers such as limited access to capital, a lack of technical expertise, and limited market opportunities. Moreover, it examines green sectoral challenges faced by youth and female entrepreneurs, including energy, water and waste sectors. Building upon these insights, the paper proposes a set of tailored strategies to strengthen the participation of youth and female-owned SMMEs as newcomers in green industries to ensure a Just Transition does not leave anyone behind. These strategies encompass capacity initiatives, targeted financial support mechanisms, business development, and mentorship programs, enterprise and supplier development initiatives and policy interventions aimed at levelling the playing field and fostering an enabling business environment for inclusive participation in the Just Transition as local green entrepreneurs. By addressing the unique needs and aspirations of youth and female entrepreneurs, empowering SMMEs owned by these demographics can drive meaningful progress toward a Just Transition, promoting economic resilience, social equity, and environmental sustainability.

Presenters

Elize Hattingh joined TIPS in November 2020 as a Researcher: Sustainable Growth. She has a Master’s Degree  in Sustainable Development and Management from Stellenbosch University’s School of Public Leadership in partnership with the Sustainability Institute. She has been actively involved in promoting the sustainable development agenda for more than 15 years.

Michael Hector has a PhD in Political Science from Stellenbosch University, where his research focussed on the green economy and environmental governance in South Africa. His thesis studied the use of ecological modernisation and market mechanisms (and the implementation thereof) in South Africa’s environmental and waste management policies,

Julie Wells is a communication and business management specialist with almost 30 years of experience. She has been involved in driving the green industry agenda since 2012, as the communication and operations manager at the National Cleaner Production Centre, South Africa (NCPC-SA). The NCPC-SA is a national support programme that assists companies to adopt more sustainable business practices, saving valuable resources and promoting inclusive economic growth. 

Dr Jenitha Badul is the Senior Manager/Policy Advisor for Sustainability Programmes and Projects, at the Department of Environment, Forestry and Fisheries and has been with the Department since February 2003. Her professional experience includes the co-ordination of green economy project planning, and co-rdination and of implementation across spheres of government, in collaboration with United Nations Agencies and country donor partners.

Aysha Lotter is an environmental and mineral law consultant and researcher focusing primarily on the Anglophone African countries. Her research focuses on Extended Producer Responsibility, Integrated Environmental Management and Transformative Negotiations. She is pursuing an interdisciplinary PhD (Private Law and Chemical Engineering) at the University of Cape Town

Susanne Karcher started her company EnviroSense CC (an Environmental Consultancy) in Cape Town in 1999 after completing Chemical Engineering studies in Germany. Her company specialises in the planning, development and facilitation of tailor-made governmental, industrial/commercial and residential Integrated Resource and Waste Management programmes ultimately geared towards pollution prevention. Susanne is also a founding member of the African Circular Economy Network.

Nicole Booyens is a socio-economic development specialist who seeks and shares new solutions to social problems. With a focus on sustainable and circular development, she promotes economically empowered, socially advanced, and environmentally conscious living. She founded Cause Development Agency in 2008 to provide insight, training, and project implementation services to changemakers and non-profit professionals.

Other Focus Groups

Sector Focus Area: Sustainable water management

Sector Focus Area: Renerable energy and energy efficiency

                                     Fund on International Energy (PIE) An International Platform Hosted at Stichting European Climate Foundation

SMME INCLUSION IN THE JUST TRANSITION

Focus Group: Opportunities and Barriers for SMMEs in Just Transition towards a Low Carbon Economy
Sector Focus Area: Responsible water management

As the global community increasingly prioritises the transition to a sustainable and equitable economy, the imperative to ensure the inclusion of small, medium, and micro enterprises (SMMEs) becomes paramount. Within this context, empowering youth and female-owned SMME newcomers in green industries emerges as a pivotal strategy for fostering just transition inclusion. This paper explores the business challenges and opportunities faced by SMMEs owned by marginalised groups such as youth and women as they navigate the transition to greener practices and industries. Drawing on a review of existing literature and case studies, the paper identifies key SMME business barriers such as limited access to capital, a lack of technical expertise, and limited market opportunities. Moreover, it examines green sectoral challenges faced by youth and female entrepreneurs, including energy, water and waste sectors. Building upon these insights, the paper proposes a set of tailored strategies to strengthen the participation of youth and female-owned SMMEs as newcomers in green industries to ensure a Just Transition does not leave anyone behind. These strategies encompass capacity initiatives, targeted financial support mechanisms, business development, and mentorship programs, enterprise and supplier development initiatives and policy interventions aimed at levelling the playing field and fostering an enabling business environment for inclusive participation in the Just Transition as local green entrepreneurs. By addressing the unique needs and aspirations of youth and female entrepreneurs, empowering SMMEs owned by these demographics can drive meaningful progress toward a Just Transition, promoting economic resilience, social equity, and environmental sustainability.

SMME INCLUSION IN THE JUST TRANSITION

Focus Group: Opportunities and Barriers for SMMEs in Just Transition towards a Low Carbon Economy
Sector Focus Area: Renewable energy and energy efficiency

As the global community increasingly prioritises the transition to a sustainable and equitable economy, the imperative to ensure the inclusion of small, medium, and micro enterprises (SMMEs) becomes paramount. Within this context, empowering youth and female-owned SMME newcomers in green industries emerges as a pivotal strategy for fostering just transition inclusion. This paper explores the business challenges and opportunities faced by SMMEs owned by marginalised groups such as youth and women as they navigate the transition to greener practices and industries. Drawing on a review of existing literature and case studies, the paper identifies key SMME business barriers such as limited access to capital, a lack of technical expertise, and limited market opportunities. Moreover, it examines green sectoral challenges faced by youth and female entrepreneurs, including energy, water and waste sectors. Building upon these insights, the paper proposes a set of tailored strategies to strengthen the participation of youth and female-owned SMMEs as newcomers in green industries to ensure a Just Transition does not leave anyone behind. These strategies encompass capacity initiatives, targeted financial support mechanisms, business development, and mentorship programs, enterprise and supplier development initiatives and policy interventions aimed at levelling the playing field and fostering an enabling business environment for inclusive participation in the Just Transition as local green entrepreneurs. By addressing the unique needs and aspirations of youth and female entrepreneurs, empowering SMMEs owned by these demographics can drive meaningful progress toward a Just Transition, promoting economic resilience, social equity, and environmental sustainability.

Sakhile Ndlovu is an economist and researcher at TIPS, where he joined in 2024. His work at TIPS explores how industrial policy can support inclusive and sustainable development in South Africa. He holds a BA Honours in Political Studies and International Relations and an MPhil in Economics (specialising in industrial policy), both from the University of Johannesburg and completed with distinction. His Master's research examined accumulation in South Africa’s sugar industry through a political economy lens, highlighting how policy regimes and entrenched power dynamics shape industrial outcomes. His broader interests include macroeconomics, structural transformation, financialisation, and the political economy of industrialisation in emerging markets. Sakhile is an aspiring development economist with a background in academic research and teaching, committed to evidence-based policymaking that supports equitable and transformative economic strategies.

The demand for electricity in the Southern African Development Community (SADC) region is anticipated to double from 280 terawatt hours (TWh) in 2010 to 570 TWh by 2030. By extension, the region will require significant amounts of electrical equipment, which includes items that are used for generation, conversion, transmission, supply, control, and utilisation of electric energy. The SADC region is a net importer of electrical equipment, although South Africa supplies some of the equipment, including cables and structural steel products to the region, and Zambia produces copper wire on a large scale. If more local requirements for electrical equipment were produced in the region, it would stimulate investment, innovation, manufacturing, and job creation both directly and indirectly.

This regional value chain report examines whether SADC countries can move up the value chain and produce more inputs. It considers opportunities for further value addition in three Southern African countries – South Africa, Zambia, and Zimbabwe.

The TIPS Development Dialogue: Industrial policy after the COVID-19 downturn was held on Thursday 25 April 2024. For more information about the programme and speakers, and copies of the video and presentations, go to Development Dialogue.

The Tracker added 23 projects in the fourth quarter of 2023 with a pledged investment value amounting to R478.7 billion recorded from 12 projects. The other 11 projects have not yet reported their respective project values. Monitoring updated 28 pre-existing projects to the Tracker this quarter.

The South African start-up sector has experienced significant growth over the past decade. However, the growth of start-ups in South Africa is still far from its potential. Growth elsewhere in Africa has, in recent years, been far more rapid. Once the leading country in Africa for investment in start-ups, South Africa has been overtaken by Nigeria while other African countries, such as Egypt and Kenya, have been growing more rapidly than South Africa. 

This policy brief identifies the key constraints that currently curtail the rate of growth of the South African start-up sector, and outlines the measures that could address these constraints. It follows a November 2023 TIPS workshop, Growing the Start-Up Economy: Accelerating Local and Foreign Investment. Inter alia, the policy brief draws on the presentations and discussion at the workshop.

PRESENTATIONS

Nishal Robb (TIPS) – SA economic trends pre- and post-COVID-19: Implications for industrial policy

Itumeleng Mokoena (DNA Economics) – Trends in the global economy since 2008 and Implications for South Africa's industrial policy

Nokwanda Maseko (TIPS) – Post-covid industrial policy in the context of the climate crisis

Neva Makgetla (TIPS) – The political economy of industrial policy in SA

AGENDA

Opening Remarks and Moderator: Saul Levin (TIPS)

Presentations and discussion

• Nishal Robb (TIPS) – Insights from Paper: SA economic trends pre-and post-COVID-19: Implications for industrial policy
• Itumeleng Mokoena (DNA Economics) - Insights from TIPS Paper: Trends in the global political economy and trade
• Nokwanda Maseko (TIPS) – Insights from Paper: The climate crisis
• Neva Makgetla (TIPS) – Overview and presenting Insights: The political economic context for industrial policy
• Tanya van Meelis (COSATU) - Discussant

BACKGROUND

The COVID-19 pandemic in 2020 initiated a series of crises, ranging from supply-chain disruptions to geo-political tensions that substantially affected global markets. In South Africa, these developments aggravated joblessness and inequality, contributed to stress on network infrastructure, complicated the response to the climate crisis, and slowed overall growth. The improvement in prices for mining exports in the early 2020s provided only temporary relief.

These issues have reshaped the landscape for industrial policy in South Africa, opening up new opportunities as well as raising threats and obstacles. The development dialogue aims to promote discussion about how industrial policy has to evolve to address these new realities. To support the debate, TIPS researchers will present research undertaken over the past year that aimed to define the challenges more clearly, with in-depth dives into trends since 2020 in economic growth and employment; the climate crisis and policy responses to it; global trade and power relationships; and the local political economic context.

ABOUT THE SPEAKERS

Moderator

Saul Levin is the Executive Director of TIPS. He previously worked as a Chief Director in the Economic Development Department (EDD) with oversight over the Development Finance Institutions reporting to EDD.

Presenters

Dr Neva Makgetla is a senior economist at TIPS. Makgetla has published widely on the South African economy and worked for many years in government.

Nokwanda Maseko is a senior economist at TIPS. Her work is at the intersection of industrial policy, gender and the just transition. She previously worked as a Budget Analyst at the National Treasury, and as an Assistant Director for Industrial Policy at the Economic Development Department.

Nishal Robb is an economist at TIPS. Nishal has worked on a range of topics, including the history of South Africa’s labour-intensive clothing industry; the impact of poor school safety on education; the financialisation of South African firms and implications for structural transformation; and illicit financial flows, tax havens and industrial development in South Africa.

Itumeleng Mokoena is an economist at DNA Economics. He has worked on several projects across different sectors including financial services, government and manufacturing.

TIPS Dialogues bring together academics, policymakers, civil society organisations, workers, and practitioners
to discuss important issues and share ideas on industrial policy.

TIPS is partnering with the Department of Trade Industry and Competition (the dtic). 

eNCA 11 April 2024 - Interview with Neva Makgetla (TIPS Senior Economist)

Watch on YouTube