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A recent online press conference led by the World Business Angels Investment Forum (WBAF) revealed that now more ever financial inclusion will empower entrepreneurs to survive the impact of COVID-19.

Present at the press conference was WBAF chairman, Baybars Altuntas, President of WBAF global startup committee, Professor Sigh, managing director MBA, Ingrid Vasiliu-Feltes, and WBAF international partner and founder of South African-based Divaine Growth Solutions, Yolanda Mabuto.

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Mabuto provided insights on the global entrepreneurship survey results, revealing that over 40% of businesses indicated that they are not confident that their business has the financial resources to continue operating throughout the COVID-19 pandemic.

Access to financial resources has become a challenge with 23,8% of survey respondents indicated a decrease, while 52,6% indicated access to financial resources remained the same, 30,6% indicated they can survive less than a month without any turnover, and 54,0% said they can survive between one to three months.

“We have experienced a widespread adverse impact of the COVID-19 pandemic on business turnover across all industries. The industries reporting the highest proportions within the normal range were mining and quarrying; electricity, gas and water; and community, social and personal services,” Mabuto stated.

She continued: “Leading entrepreneurship initiatives, like the Woman Power Boss & Global Businesswomen Evolution, allowed us an opportunity to be privy on the challenges that startup businesses faced during COVID-19 and mindful of possible remedies the South African government is putting in place to support businesses.

“We work with the government to position the SMEs for support and collaborate with Clarion Event’s Initiate! programme aimed at empowering start-ups and SMEs during this time and beyond. During the lockdown, we kept the solutions-based conversation going through a series of GenderLens interviews in collaboration with ESI Africa.”

Mabuto noted that local and global collaboration has never been more important than now. It is time to ensure that entrepreneurs stay in business and that the integration with government financial relief is well managed and inclusive.

The timing and speed of the economic recovery, depends on how quick the health crisis can be solved, she stated, adding that the health crisis is likely to exacerbate inequality, mental health problems, and lack of societal cohesion.

Reviving the economy

The COVID-19 pandemic has created profound disruptions to the economy and society. Many industries are experiencing an adverse impact from the pandemic.

Mabuto recalled that in response to the crisis, from 25 March South Africa was placed under a national lockdown to reduce the spread of the virus, which resulted in businesses ceasing operations.

Three months into lockdown, the government’s goal is to steadily increase economic activity while putting measures in place to reduce the transmission of the virus and provide adequate care for those who become infected and need treatment.

The businesses that were affected at the beginning of the national lockdown are those that were not regarded as providing essential services. The industries included those who are reliant on the movement of goods, the telecommunications sector, and selected mining activities due to a decrease in demand for minerals, accommodation and tourism due to travel ban.

Mabuto pointed out that the COVID-19 economic crisis has already hit poorer people and those in more socially disadvantaged groups disproportionately harder.

“Our involvement with World Business Angel Investment Forum affiliated partner of the G20 Global Partnership for Financial Inclusion aims to facilitate access to finance for businesses, with the aim of generating economic development, jobs and more social justice worldwide. To achieve this goal, WBAF lays the groundwork for its first $10 million investment fund (WBAF Angel Investment Fund), which will be an international co-investment platform for start-ups,” Mabuto concluded.

Read the full survey results.