COVID-19 crisis an opportunity to cut red tape

20 March 2020

It is already clear that small, micro and medium business enterprises (SMMEs) will find it harder to handle the stresses and strains of the Covid-19 pandemic than larger organizations.

Equally obvious is that this sector of the economy will be crucial in reviving economic activity when the pandemic subsides, as it surely will.

Perhaps now would be a good time for us to be thinking about what resources can be made available to ensure that the small business sector survives and comes back even stronger in the future. Developed countries have huge resources for programmes such as these, but a developing country like South Africa might find it more difficult to direct resources in this direction. What money can be prudently made available should target the SMME sector as a priority, but financial support is not the only answer. The Covid-19 challenge may well present us with an opportunity to lower the cost of doing business by removing regulatory red tape.

Surveys show that 40% of the barriers to small business growth is made up of government regulations. Bringing this down by speeding up and simplifying permit applications and registrations should be as important as protecting public health.

What has been encouraging about the response to Covid-19 is the extent to which all sectors of society have been working together against this common enemy. As a Chamber, we hope that this change in mind-set will result in government working more closely with the private sector in future in simplifying the regulatory framework and reducing the cost of doing business.

It’s already an emergency situation for SMMEs, and it is made worse by COVID-19. This challenge offers an all-round opportunity to cut red tape to the bone.

Issued by Dean Le Grange, Media and Digital Co-ordinator, Cape Chamber of Commerce and Industry, 20 March 2020