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SMEs

Strategies and policies on TNC-SME linkages country case studies: South Africa (SDS RP70)

Strengthening the linkages between global corporations and local domestic enterprise

Authors: G. Robbins; UNCTAD
Publisher: School of Development Studies, University of Kwazulu-Natal, Durban, South Africa, 2006

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This report documents and assesses selected South African experiences with regard to the promotion of linkages between Trans- National Corporations (TNCs) and Small and Medium Enterprises (SMEs). It outlines the context and intent of South African approaches to the issue of TNC-SME linkages, comments on perspectives on the effectiveness of such activities and looks in some detail at two particular initiatives at the local and sub-regional level.

Following examination of the policies and programmes directly or indirectly relevant to TNC-SME linkages, the report points some areas which could benefit from additional attention:

  • greater transparency and reporting by TNCs active in developing countries as to their links with local firms
  • encouraging learning and co-operating between TNCs and facilitating improved commitments through charters and other voluntary instruments
  • Setting up of business development partnerships at the local or sub-regional level where TNCs operate
  • more explicit performance measures of government programmes around TNC-SME linkages in relation to trade development, FDI attraction and SME development
  • linkage development activities into value chain, cluster or inter-firm network processes - around service activities and core supply and downstream transformation processes
  • empowering local, sub-regional and provincial level actors to offer improved and accessible services to SMEs seeking to build relationships with TNCs domestically and globally.