Jack Ma, the founder of Chinese e-commerce giant Alibaba Group, has used his first visit to South Africa to encourage governments in Africa to support small businesses in order to address the crippling challenge of unemployment.

“We can create jobs by encouraging small businesses and young people in the African continent,” said Ma on Wednesday at Wits University in Johannesburg.

In their support of small businesses or start-up companies, the government could create policies to grow businesses including offering them tax breaks or “good tax conditions”, said Ma.

“Give good tax conditions to start-ups. Big companies don’t need these. Let’s get policies for start-ups and young companies,” he said.

Ma is in South Africa to launch a new programme for African entrepreneurs with US$10-million (R134-million at the time of writing) in funding.

The programme, called the “Netpreneur Prize”, aims to support 100 young African entrepreneurs by 2030 by giving them grants totalling $10-million.

The Jack Ma Foundation also plans to launch five training hubs in Africa for emerging entrepreneurs to learn about business, e-commerce, distribution and logistics. The foundation has not announced the countries targeted for the training hubs.

Ma’s address was largely centred on governments creating an enabling environment for entrepreneurs in Africa.

“Governments should encourage entrepreneurs. It’s the entrepreneur that will drive dreams in Africa. Small businesses create jobs. Dreams drive the economy.”

Red tape

Ma’s speech came at a time when there are growing views that government policies and regulations are stunting the development and growth of small businesses.

Although the government in South Africa continues to acknowledge the potential of small businesses to boost the economy and making a dent in unemployment figures — standing at 27.2% in the second quarter — most businesses still complain about lack of financial and skills support from government. Entrepreneurs also complain about the lack of clear entrepreneurship policies and an environment fraught with regulation.

Ma also encouraged governments to start having dialogues with small businesses to understand their concerns, challenges and opportunities.