BUREAUCRACY and administrative delays are suffocating small businesses and undermining economic growth, President Cyril Ramaphosa warned on Wednesday, 15 April.
Addressing the National Local Economic Development Summit at the Birchwood Hotel & OR Tambo Conference Centre in Boksburg, Ekurhuleni, Ramaphosa said the current system is failing entrepreneurs.
"Instead of rolling out the red carpet for small businesses, we are placing obstacles in their path," he said.
Ramaphosa described the environment as "uncomfortable" and often "hostile" to SMMEs.
He highlighted long delays in permits and licences, as well as allegations of corruption where officials demand incentives before processing applications.
"This is not just an administrative problem. It's an economic crisis," the president said.
He stressed that unreliable infrastructure and limited market access further push businesses to operate outside the country rather than locally.
Ramaphosa said municipalities sit at the centre of both the problem and the solution, as they control key levers such as approvals, infrastructure and compliance costs.
He called for a shift from a culture of control to one of enablement.
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"We must ask ourselves: how many people does this business employ and how can we help it employ more?"
Ramaphosa proposed a streamlined approval system with strict timelines, where applications such as licence renewals are automatically approved if authorities fail to act within a set period.
He also emphasised the need to cut red tape to attract investment and support informal traders and township entrepreneurs.
While some municipalities have made progress by improving systems, introducing e-registration and ensuring regulatory certainty, Ramaphosa said these remain exceptions.
The president said that backlogs in business licensing hinder access to government support.
"Investment will always gravitate towards municipalities that make it easy to do business."
The summit will also advance the District Development Model through "One Plan" economic compacts aimed at co-ordinating investment in key areas such as transport, bulk services and business infrastructure.
Meanwhile, Ekurhuleni Mayor Nkosindiphile Xhakaza echoed the urgency for reform.
"Our people are not asking for promises. They want jobs, reliable infrastructure, and real access to opportunities," he said.
He also stressed that Local Economic Development must be central to addressing unemployment and inequality.
"We are aligning planning across all spheres of government, investing in infrastructure and prioritising skills development to unlock growth," he said.
