Trade, Industry and Competition contextualizes R100 billion Transformation Fund.

The Department of Trade, Industry and Competition (the dtic) wishes to contextualise the objectives of the Transformation Fund and the process underway to generate discussion and arrive at consensus for its eventual implementation. This Fund is a critical initiative that advances South Africa’s constitutional commitment to economic redress and inclusive growth, which the dtic is bound by. Rooted in Section 9(2) of the Constitution, it aims to promote shared equality through legislative and other measures to empower black-owned enterprises and small, medium, and microenterprises (SMMEs).

The Fund also reflects the statement of intent of the Government of National Unity (GNU), which emphasizes fostering redress and inclusive economic growth. The GNU’s transformative agenda seeks to dismantle systemic barriers to economic participation, ensuring that historically-disadvantaged communities are afforded equal opportunities to thrive in all sectors of society.

In addition to advancing the constitutional imperative of economic redress, the Fund is anchored in the Broad-Based Black Economic Empowerment (B-BBEE) Act, particularly Section 2(h), which obligates government to "increase the effective economic participation of black-owned and managed enterprises, including small, medium, and micro enterprises and cooperatives, and enhance their access to financial and non-financial support." The Fund directly addresses these priorities while promoting greater compliance with B-BBEE requirements and unlocking opportunities for sustainable growth.

Aligned with the National Development Plan’s (NDP) Vision 2030 to eliminate poverty and reduce inequality, the Fund supports Outcome 4: decent employment through inclusive economic growth. It also reinforces the Department’s Medium-Term Development Plan (MTDP) 2024–2029, which prioritizes job creation and inclusive economic participation, as outlined in the revised Annual Performance Plans (APPs). 

Objectives of the Transformation Fund:
The Transformation Fund:
1. Promotes Economic Inclusion: Provides financial and non-financial support to black-owned enterprises, ensuring meaningful participation in the economy.
2. Addresses Fragmentation: Aggregates resources from existing Enterprise and Supplier Development (ESD) obligations and other
sources to enhance impact and efficiency.
3. Fosters Sectoral Growth: Focuses on high-impact sectors, including agriculture, tourism, ICT, manufacturing, and businesses in township and rural areas.
4. Enhances Market Access: Offers technical assistance, pre- and postinvestment support, and market access opportunities to beneficiaries.
5. Supports Industrialization: Aligns with South Africa’s industrial policy to stimulate growth in productive sectors and underdeveloped areas.

The Minister of Trade, Industry, and Competition, Mr. Parks Tau, states, “The Transformation Fund is not about imposing new obligations but about ensuring that existing commitments under the B-BBEE legislation are strategically utilized to create meaningful economic transformation. It embodies our constitutional mandate to achieve equality and empower historically disadvantaged communities.”

As outlined in the Department’s revised Annual Performance Plans (APPs), the Fund’s conceptual framework will be opened for public consultation and stakeholder engagement with a target to mobilize R100-billion by 2029. We welcome the ongoing
debate on transformation and look forward to broad participation during the consultation process. This timeline underscores the dtic’s commitment to achieving sustainable and impactful transformation.

Minister Tau adds, “The Transformation Fund is not merely a funding mechanism, it is a catalyst for change. Through collaboration with the private sector, civil society, and other stakeholders, we will create an economy that is inclusive, sustainable, and reflective of South Africa’s diversity.”

Media enquiries:
Mr Yamkela Fanisi – Ministerial Spokesperson
Department of Trade, Industry and Competition
E-mail: YFanisi@thedtic.gov.za
Mobile: 076 034 6551

Mr Bongani Lukhele – Director: Media Relations
Tel: (012) 394 1643
Mobile: 079 5083 457
WhatsApp: 074 2998 512
E-mail: BLukhele@thedtic.gov.za

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