6.3. TOWARDS A NEW SPATIAL POLICY FRAMEWORK
6.3.4. Constraints of small-scale industries and their integration into the value
a) Information
A value chain consists of various sets of activities which different firms in different sectors, operating in specific industries, implement with the objective of delivering a valuable product or service to the market. Thus for the development of effective involvement by informal markets within the eThekwini municipality to occur, understanding of the sector and what adds value is vital. One of the constraints informal businesses face is the lack of information and knowledge on how to connect with the market. With this lack of information and understanding, businesses tend to focus on short term goals and are driven by the prospect of money; neglecting the notion of sustainability, goals and objectives for the long run. Due to the lack of opportunities and the limited spatial capacity for activities within the eThekwini municipality, informal businesses often get involved in the activities of different sectors, therefore convoluting the understanding of the main sector that the informal market is defined as, and in return produce products of little value or nothing. With the lack of understanding, there will be specific challenges faced by informal market participants and they have to deal with those challenges.
Source: The DTI National Directory (2010)
181 b) Accuracy of data
Accurate statistics is a vital element for the success of informal businesses, and the problem of the inaccuracy of statistics in the eThekwini municipality is a major obstacle to SA’s attempt to improve policies that are operative and support schemes for informal/small enterprises. Informal/small business development initiatives must be on a platform where informal market businesses actually operate with factual spatial, social and economic statistics. These statistics must be targeted precisely at value chains, and be specific to the informal/small businesses’ localities so that they can effectively address their varied competition, constraints, opportunities, characteristics and needs, (Mahembe, 2011).
c) Environment
The environment and climate changes are also part of the constraints affecting the informal market at large. For non-agricultural production, the value chain has stalled due to various factors lacking within the eThekwini municipality. Firstly, land capacity is a major component for urban areas involved in non-agricultural production, and space within the eThekwini municipality is very limited. The vast demand for land for housing to amend the issue of the housing backlog creates significant conflict with the demand for land for business purposes, as the urban poor who participate in the informal marker for economic stability also seek space to in which to operate. As a result the value chain of the non-agriculture sector is affected: production is limited in terms of quantity and quality.
Secondly, climate change, global warming and air pollution affect production levels, the value chain and operational viability. They contribute to dilapidation of the infrastructure and physical distortion of the environment, which affect the well-being of the markets’
participants. With the limited amount of urban space, activities that are not agricultural in nature are affected as the majority of people are unemployed and the space becomes overcrowded. The element of the value chain within the informal market being disconnected by spatial factors affects the supplier and consumer relationship, and influences the economies of scale; where the balance between demand and supply is unequal and prices are affected. This will eventually lead to prices becoming increasingly high and businesses will be restricted to buying and selling at unprofitable rates.
d) Public support and technical capacity
Public support is vital for informal businesses’ success. People often neglect informal/small businesses for big corporations, and this issue creates financial constraints for SMEs as they struggle to generate enough income to keep their businesses going. The majority of informal/small businesses lack technical capacity even though it is effective, primarily
182 because technology is expensive. This discourages business owners from buying technological assets, therefore their production is limited, quality is decreased and the business tends to fail in the long run. In some instances, business owners lack knowledge concerning recent technology and how to use it efficiently to improve their businesses.
e) Telecommunication services
Telecommunications is a term derived from the Greek word tele, which simply means over a distance, while communication simply means the sharing of information or messages between two or more entities. Putting the two terms together to form telecommunications refers to exchanging or sharing information over a distance, between two or more entities (Dean, 2003). Telecommunication services enable access to information and communications technology. For this initiative the ninth Sustainable Development Goal (SDG9) should be analysed (Statistic South Africa, 2017). The aim of this goal is to significantly increase access to information and communications technology within the eThekwini municipality. The authorities and the community will be able to communicate better regarding spatial planning, amongst other issues. An assessment should thus be conducted on whether or not to provide universal and affordable access to the spatial planning of the city and include the poor economic development initiatives.
f) Communication technology
The eThekwini municipality has attempted to improve its utilisation of communication technology by providing free municipal newspapers in every municipal department and Sizakhala centre. The Metro Ezasegagasini newspaper which is published and distributed fortnightly includes information detailing job opportunities and events that will take place in the city. Sizakhala is a subdivision of the eThekwini municipality which provides communication technology such as computers with free internet access, which people from all occupations can use to look for employment opportunities and skills-based events that they can attend to empower themselves and add value to their businesses.
The eThekwini municipality has been making progress in terms of transforming Durban into a ‘smart city’ by converting 85 libraries into internet hotspots with the necessary infrastructure. Ht5is initiatives could be of great value to informal participants, as members can utilise computers that belong to the libraries, or bring their own wireless enabled laptops to connect and browse the internet for educational and entrepreneurial purposes. Although there has been some progress in terms of installing telecommunications infrastructure in the libraries in Durban, this has not been rolled out on a larger scale in the eThekwini municipality and further work is needed. This installation has been made possible by the US
183 funded Carnegie Project, which uses the city’s fibre-optic infrastructure (Department of Economic Development and Tourism, 2017). Libraries were initially chosen for the provision of affordable connectivity to the community, due to their pervasive presence as educational nodes throughout the city of Durban.
A shortfall in the implementation of this telecommunications infrastructure around the eThekwini municipality, especially in peripheral area libraries, is that not all of the library staff have been trained on how to use the equipment and not all library members know how to use these computers and the internet. There are also not enough computers for the number of people requiring them, hence the municipality promotes that people bring their own wireless enabled laptops to the library. However, there are few people who have their own laptops and there is a large concentration of crime in the city so people who own laptops might not be comfortable carrying their laptops to the library for safety purposes.
Whether or not the eThekwini municipality will be able to achieve the ninth Sustainable Development Goal by 2020 is questionable since there is gap that needs to be addressed;
programmes need to be implemented to assist people to use this information and communication technology (Department of Economic Development and Tourism, 2017). The attempts made by the libraries to ensure that everyone has the opportunity to use the computers by restricting the time that each person is allowed to use the computers and internet have been effective to a certain extent. At least everyone has the opportunity to use these facilities at the libraries, even though they have to wait their turn since access works on a first come first served basis.
In terms of the newspapers that are made available for the general public: they do assist those seeking employment as they have all the relevant information regarding how to apply for positions and which channels to follow. However, there remains the need to assist illiterate and disabled people who cannot read. There is a need to make information and communication accessible to them, by using other means such as radios or television. The municipality may install software that disabled people understand or invest in providing newspapers printed in braille for those who need them.
It may not be feasible to provide those in the surrounding rural areas of the eThekwini municipality with computers and internet access, since most of the older generation do not own or understand communication technology such as computers and laptops, and it is the older generation which comprise the majority of the informal market participants.
Communication and information in the city is dominated by digital resources whereas in informal markets people still rely on word-of-mouth, radio and newspapers to get information. Thus the method selected to communicate information should be structured
184 according to the community members’ abilities. Lastly, affordability should also be considered, since data is expensive in South Africa and people still prefer purchasing newspapers since they are cheaper.