Durban - Innovators and owners of emerging businesses could soon be in the “pound seats” following the announcement by eThekwini Municipality that it is setting up a fund to assist these businesses with capital.
Durban mayor Mxolisi Kaunda made the announcement yesterday while addressing delegates attending the City’s Energy Transformation Summit held at the Inkosi Albert Luthuli Conference Centre.
The two-day summit is aimed at helping the municipality chart a way forward towards a more energy secure future.
The municipality wants to engage with independent power producers who can supply it with 400MW by 2025 and supply it with enough power to be energy independent by 2035.
Kaunda said the fund would not be managed by the City, and would have an independent board. Its intention was to make capital available for those who wished to start or expand their businesses.
The announcement has received mixed reaction from opposition parties, with DA councillor Thabani Mthethwa describing it as a good idea and IFP councillor Mdu Nkosi saying he was sceptical, pointing to the financial constraints in the municipality.
The details about the fund were not clear, including the capital that would be invested and how it would be different from other funds which were administered by entities including the National Youth Development Agency and the Small Enterprise Finance Agency.
According to Kaunda, this fund was intended to ensure that ideas and innovation did not die because of the absence of money to invest in them.
Furthermore, it aimed to ensure that small businesses like co-operatives were not confined to remaining small and solely focused on jobs like catering or grass cutting because they did not have funds to build capacity and take on bigger projects.
“The City is finalising its enterprise and development fund. That fund is not going to be a government fund. It’s going to be a fund to support enterprise and development to make sure that in the city, even the developing companies are working as expected.
“That is not going to be a fund that we will be managing as a city; it’s the fund that will have someone appointed through the legal framework to operate,” said Kaunda, adding that it would have a board comprising government and private sector stakeholders.
“This fund must help us. Those who have ideas, who are innovative, must not complain about not having capital injection to start such initiatives.
This fund must enable them when they have ideas, capability and capacity. They should not be complaining about access to finance,” he said.
The DA welcomed the announcement, but councillor Mthethwa warned that the City could not take on this task alone. “This is a welcomed move, but the municipality does not have the capacity to implement this. We believe there should be the involvement of the private sector.”
The IFP’s Nkosi said it was dangerous for the mayor to announce the initiative publicly. “The question is, does the City have the money to do this?
“We are faced with challenges; you cannot announce something like this at such a gathering and then it does not happen after you have raised people’s hopes,” he warned.