“The success of German business is driven by its SMEs, a group to which more than 99 per cent of all firms in Germany belong. These companies account for more than half of our economic output and almost 60 per cent of jobs. Approx. 82 per cent of apprentices in Germany do their vocational training in an SME.” Federal Ministry for Economic Affairs and Energy

There’s a compelling case that small and medium enterprises form the backbone of geopolitical strength—though this connection often goes unnoticed in policy circles.

The chain is straightforward: Thriving SMEs → Economic resilience → Strengthened global positioning.

Countries with robust SME ecosystems demonstrate greater economic stability during global shocks. They create diversified supply chains, foster innovation at the grassroots level, and build the middle-class foundation that sustains long-term growth.

When we examine countries that demonstrate exceptional geopolitical influence relative to their size, a pattern emerges. Germany’s Mittelstand model sees SMEs generate 68% of exports¹ while Singapore has sophisticated SME ecosystems. These nations show that distributed economic power creates more resilient foundations than concentrated conglomerates or South Africa’s “tenderpremiership” model.

The South African context reveals a stark contrast. While companies like those in the Siyanqoba Ngamandla Holdings portfolio led by Valentia Mkhabela demonstrate how visionary SME leadership can drive industrial transformation and global competitiveness, the broader ecosystem tells a different story. The question is whether South African policymakers fully grasp this connection when crafting and implementing economic strategy.

Germany trains 82% of its apprentices in SMEs. Singapore has dedicated SME development agencies. South Africa has potential—but do our policies match our rhetoric?

South African entrepreneurs: How effectively has government support contributed to your business resilience and global competitiveness compared to what you see internationally?

Analysis by Lunga Dweba

References: ¹ Federal Ministry for Economic Affairs and Climate Action. The German Mittelstand as a model for success. Available: https://www.bundeswirtschaftsministerium.de/Redaktion/EN/Dossier/sme-policy.html