By Vutivi Business News
Minister of Trade, Industry and Competition Parks Tau has established a fund aimed at addressing challenges linked to foodborne illnesses particularly in township spaza shops.
The intervention comes after more than 20 people died from suspected food poisoning after consuming items from spaza shops late last year.
In response to the crisis the government shut down more than 1 000 spaza shops and issued a directive compelling spaza shop owners to register their businesses with municipalities.
On Tuesday, Tau told the Select Committee on Economic Development and Trade in Parliament this week that the primary objective of the fund is to support township-based community convenience shops, including spaza shops.
The fund is set to be administered jointly by the Ministry of Small Business Development and the Department of Trade, Industry and Competition (DTIC).
“The prevalence of food poisoning incidents linked to spaza shops poses significant health risks to consumers and erodes trust in these businesses. Contributing factors include inadequate food handling practices, poor storage conditions, and limited awareness of hygiene standards. This fund has been established to help address some of these challenges,” Tau said.
He added that the funding will be utilised for business refurbishments and to facilitate wholesale aggregation. Additionally, non-financial support will be provided, including technical skills development, regulatory compliance assistance, and capacity-building initiatives.
“The support package aims to strengthen locally owned spaza shops in South African townships by enhancing their operational efficiency, building capacity, and improving access to competitive pricing through strategic partnerships. This includes enabling spaza shop owners to benefit from bulk purchasing advantages and business support services to enhance their sustainability and competitiveness,” Tau said.
He further outlined that the fund’s implementation will be led by the National Empowerment Fund and the Small Enterprise Development and Finance Agency. The entities are set to provide both financial and non-financial support, focusing on critical areas such as regulatory compliance, business management skills, operational capacity-building, working capital, and infrastructure refurbishment.
Tau said the initiative will require strong partnerships with key stakeholders, including private sector partners, health authorities, fast-moving consumer goods manufacturers and provincial governments and the Department of Cooperative Governance and Traditional Affairs.
Tau said this is to ensure a comprehensive support structure which will drive sustainable growth, improve market access, and foster economic resilience within South African townships.
“The expected outcomes of this initiative include increased income and job creation for local spaza shop owners, the strengthening of township economies, and improved competitiveness of locally owned businesses. Additionally, beneficiaries will gain enhanced supply chain access, leading to lower operational costs and increased profitability, while skills development programs will equip shop owners with essential business management capabilities, fostering self-reliance and long-term sustainability,” Tau said.
