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The transformation fund aims to address structural exclusion in the South African economy, the minister said.
Parks Tau, minister of trade, industry and competition. Picture: Refilwe Modise
Minister of Trade, Industry and Competition Parks Tau has extended the time for public comment on the R100 billion transformation fund by 15 days to give more people the opportunity to comment.
Tau said at a media breakfast in Pretoria on Wednesday that the transformation fund, developed in partnership with the private sector, is envisioned to mobilise R100 billion and represents “one of the most coordinated and impactful efforts yet to enhance access to finance, technical support and market opportunities for black-owned, managed and controlled enterprises, especially MSMEs, cooperatives and businesses in rural and township areas”.
He emphasised that the transformation fund will not impose any new demands on business and industry, but will consolidate funding efforts through enterprise and supplier development (ESD) and other obligations as prescribed by the B-BBEE codes of good practice.
“Let me stress that the transformation fund does not replace any well-functioning vehicles already in place. Instead, it seeks to amplify what is already required under existing B-BBEE legislation.”
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Tau said the legislative rationale for the transformation fund is anchored in the Broad-Based Black Economic Empowerment (B-BBEE) Act, which mandates government to increase the effective participation of black-owned and managed enterprises in the economy and enhance their access to both financial and non-financial support.
“It is further grounded in our constitution, specifically Section 9(2), which affirms the need for legislative and other measures to advance those disadvantaged by unfair discrimination. In this way, the transformation fund gives expression to our constitutional obligations and the goals of the National Development Plan, particularly the vision of eliminating poverty and reducing inequality by 2030.”
According to Tau, the transformation fund will be capitalised at R20 billion per year over a five-year period and disbursed through a combination of grants, loans and equity support, complemented by technical assistance, pre- and post-investment support and market access facilitation.
“In particular, we are designing the transformation fund to ensure good governance, transparency and accountability through the establishment of a special purpose vehicle (SPV), which will report to an oversight committee and a board comprised of individuals with the necessary technical and sectoral expertise.”
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Tau said since publishing the draft transformation fund concept document on 20 March, his department noticed a strong wave of public interest and engagement. He said many stakeholders welcomed the initiative, while others called for more time to prepare thoughtful and constructive submissions.
That is why the department decided to extend the period for public commentary to 28 May 2025. “This extension is based on being transparent and reaffirms our belief that policy should be shaped with people, not for them.
“It allows time for a broader range of voices, especially those of black entrepreneurs, cooperatives, organised industry and social partners to contribute to a framework that will directly affect them. Above all, we want the transformation fund to reflect the needs, realities and aspirations of those it is meant to support.”
The document is available on the DTIC website and submissions can be sent to transformationfund@thedtic.gov.za.
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