Big business identifies critical measures to boost economy, reduce unemployment after meeting Ramaphosa
The CEOs of prominent private sector companies have partnered with the government to fix Eskom’s blackouts, out-of-control crime and corruption, and inefficiencies at Transnet-operated trains and ports. The CEOs believe a turnaround can be seen in the next six to 12 months.
The CEOs of top companies in South Africa have identified at least three critical measures for the government to implement with speed to tackle the energy crisis, rampant crime and corruption, and deteriorating rail and port services.
Following their meeting on Tuesday, 1 August, with President Cyril Ramaphosa and his Cabinet members, the CEOs and leaders of business organisations have identified priority measures that have the potential to grow the economy by at least 3% every year and reduce the official unemployment rate to 28% by 2030.
“It will take time to see the results. We are hoping to see results in the next six to 12 months, especially on the employment side,” said Martin Kingston, the chair of Business for South Africa, a pan-industry body, and who attended the meeting with Ramaphosa. Kingston briefed journalists on Wednesday, 2 August, about the outcomes of the meeting with the President.
CEOs, including Discovery’s Adrian Gore, Anglo American’s Nolitha Fakude, Remgro’s Jannie Durand, Kumba Iron Ore’s Mpumi Zikalala, Sibanye Stillwater’s Neal Froneman, Standard Bank South Africa’s Lungisa Fuzile and Sanlam’s Paul Hanratty, have been brought in to offer their skills, capacity and financial resources in workstreams that will focus on three priority areas. The areas are:
- Ending rolling blackouts;
- Improving the efficiency of the rail and ports network (operated by Transnet); and
- Keeping crime and corruption in check.
The CEOs have to report back to Ramaphosa on progress every six weeks.
Fixing the energy crisis
To arrest intense Eskom blackouts, the business head honchos have called for the passage of the Electricity Regulation Amendment Bill to be expedited within the sixth Parliament (or within the next six to 12 months).
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The successful passage of the Bill would fundamentally open up the electricity market as it would pave the way for the direct purchase and transmission of electricity not only from Eskom but also from private power producers. It would allow small power users to access private power without going through cumbersome and expensive legal processes.
The passage of the Bill, which must bring the 2006 law up to date, also proposes the establishment of an independent transmission system operator for the purchase and transmission of electricity on an impartial basis.
CEOs and business organisations see the passing of the Bill, which was tabled in Parliament on 20 July after its approval by Cabinet on 29 March, as a key step in ending Eskom blackouts. The CEOs and business organisations expressed optimism about the government’s ability to move with speed to pass the Bill, despite measures on liberalising the energy market being mooted as early as 2019. Some market watchers have expressed doubt that there is sufficient time for legislators to consider the bill before the 2024 elections.
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James Mackay, the CEO of the Energy Council of South Africa, a lobby group in the energy sector, and also a participant in the meeting with Ramaphosa, said the journey to amend the Bill had been “treated on an emergency basis. This bill will go through if there is commitment.”
Although the business leaders are optimistic about law amendments, they have no control or say in the process, often relying on promises made by government officials, who themselves face capacity and commitment challenges.
Other electricity-related measures proposed by the CEOs include fast-tracking the authorisation and building of renewable energy projects and completing the establishment of the National Transmission Company of South Africa, which is necessary to enable increased investment in transmission infrastructure.
Crime and corruption, and the logistics crisis
In tackling rampant crime and corruption, the CEOs and business organisation leaders have targeted amendments to laws, mainly the passage of the National Prosecuting Authority (NPA) Amendment Bill. Passing of the Bill will pave the way to establish the Investigating Directorate (ID) as a permanent entity within the NPA with investigating powers. This is part of the government’s response to the recommendations of the State Capture Commission of Inquiry and is set to bolster the independence and capability of the ID to fight complex corruption-related crimes.
The CEOs hope that the bill will be approved by Cabinet and tabled in Parliament by the end of this month. Other measures proposed by the CEOs include providing support to the South African Police Service to aid crime detection and response, including optimising the 10111 helpline.
Read more on Daily Maverick: Business and government’s master plan to rid South Africa of its R1-trillion crime and corruption headache
They have also proposed pooling the skills and resources of the private security sector to fight crime syndicates, and the private sector providing forensic skills — at an arm’s-length basis — to the NPA.
“It is a significant step forward that for the first time, the government has supported the private sector working closely with the security cluster,” said Sibanye Stillwater’s Neal Froneman.
In the transport and logistics workstream, a freight logistics roadmap was in the process of being completed. It will be available for consultation by the end of August and submitted to Cabinet by the end of September.
Asked whether the private sector helping the government would compromise their independence and bona fides, particularly coming before the 2024 general election, business leaders said they could not afford to sit back and watch the country regress further.
“I am working unashamedly with the government because I want a South Africa that works, that delivers prosperity for everyone. I’m not doing it for the governing party; I am doing it for South Africa. South Africa does not belong to the governing party,” said Standard Bank South Africa’s Fuzile. DM