C H A P T E R 3 | I N T E R V I E W | MALUSI GIGABA, FORMER MINISTER OF PUBLIC ENTERPRISES
“ T h e l a c k o f i n v e s t m e n t s i n i n f ra s t r u c t u re d e n i e d u s t h e p o s s i b i l i t y t o i n d u s t r i a l i s e t h e S o u t h A f r i c a n e c o n o m y, a n d t h e oppor tunity to diver sify the des tinations for our inves tment to c reate a th riving manufacturing sector and to devel o p n ew tradin g par tner s (par ticularly in Africa and wi t h ot h er d e v e l o p i n g n a t i o n s ) .”
T R A N S F O R M AT I O N G i g a b a s a i d t h a t s t a t e - o w n e d e n t i t i e s h a v e a c r u c i a l ro l e t o p l a y i n t r a n s f o r m i n g S o u t h A f r i c a ’ s e c o n o m y. “ W e m u s t l o o k a t t r a n s f o r m a t i o n i n i t s b ro a d e r s e n s e . T h i s i s n o t o n l y i n t e r m s of em powering black people, but also in terms of contributing t o c h a n g i n g t h e f u n d a m e n t a l s t r u c t u re o f t h e S o u t h A f r i c a n e co n o my an d creating an ind us trial sector that wo ul d di ver si f y t h e e c o n o m y. Yo u c a n t h e n c re a t e o p p o r t u n i t i e s f o r b l a c k people, not to only chase tender s, but to become indus trialis ts t hat are go in g to d ir ty their hand s and get invol ved i n t h e development of the local indus tries. I n d u s t r i a l i s a t i o n c a n c re a t e a t h r i v i n g S M M E s e c t o r i n t h e c o u n t r y, b e c a u s e y o u c a n n o t c re a t e a S M M E s e c t o r o n t h e b a s i s o f n o t h i n g . “ Yo u m u s t l a u n c h S M M E s , s u p p o r t S M M E s , a n d h e l p t h e m d e v e l o p o n t h e b a s i s o f p ro j e c t s , w h i c h w e’ re g o i n g to place in the end for them to do. The s tate-owned com panies h a v e d o n e i m p o r t a n t w o r k , b u t t h e y c o u l d ’ v e d o n e m o re h a d w e i n v e s t e d c o n s i s t e n t l y i n i n f ra s t r u c t u re i n t h e l a s t 2 0 y e a r s a n d t h e r e f o r e i n d u s t r i a l i s e d t h e e c o n o m y. “ T h e n e x t f i v e y e a r s a re g o i n g t o b e a d e t e r m i n i n g p e r i o d . W e m u s t c h a n g e t h e g a m e , t h e s t r u c t u re o f t h e e c o n o m y, t h e s t r u c t u r e o f p a t t e r n s i n t h e e c o n o m y, a n d b e u n a p o l o g e t i c i n our pursuit in good industrialisation, as well as black e c o n o m i c e m p o w e r m e n t .” G i g a b a s a i d t h e s t a t e - o w n e d e n t i t i e s a re a l re a d y w o r k i n g t o pro mote the aims of the N ational Development Pl an (NDP). “Th e N D P e n j o i n s u s t o g ro w t h e S o u t h A f r i c a n e c o n o m y o n t h e b a s i s o f s o c i a l i n c l u s i o n a n d t o d e v e l o p t h e e c o n o m y, a n d p u r s u e 11 million jobs over the next 20 year s. How it says we should do t h a t – a m o n g o t h e r s a s t h e N e w G ro w t h P a t h i d e n t i f i e d – i s t o i m p l e m e n t a r o b u s t a n d i n t e g ra t e d i n f ra s t r u c t u re d e v e l o p m e n t pro g ramme that is going to assis t South Africa to devel o p wi t h s o c i a l a n d e c o n o m i c i n f ra s t r u c t u re . “ O u r s t a t e - o w n e d c o m p a n i e s p l a y a ro l e i n t h a t e f f o r t b y s u p p o r t i n g i n f r a s t r u c t u re . Tra n s n e t i s i n v o l v e d i n ra i l w a y s a n d p i p e l i n e s i n f ra s t r u c t u re , E s ko m i s i n v o l v e d i n e l e c t r i c i t y i n f r a s t r u c t u r e , B r o a d b a n d i s i n v o l v e d i n n e t w o r k s i n f ra s t r u c t u re , a n d o t h e r s t a t e - o w n e d c o m p a n i e s p ro v i d e e c o n o m i c s e r v i c e t h a t a r e v i t a l t o t h e S o u t h A f r i c a n e c o n o m y. The Minis tr y of Public Enterprises is at the ver y hear t of the NDP a n d i s f o c u s e d o n h o w t o p ro v i d e s u p p o r t . W h e n t h e P re s i d e n t g a v e a n i n j u n c t i o n t h a t 7 5 p e rc e n t o f g o o d s a n d s e r v i c e s r e q u i r e d b y g o v e r n m e n t m u s t b e p ro v i d e d b y l o c a l s u p p l i e r s , t h e d e p a r t m e n t c o u l d t a ke p r i d e t h a t i t w a s a l r e a d y f a r a h e a d in that ef for t.
I N D U S T R I A L I S I N G A N AT I O N Gigaba said that the Depar tment of Public Enterprises and s t a t e - o w n e d e n t i t i e s m u s t b e a g g re s s i v e a n d re l e n t l e s s i n pur suing indus trialisation over the next few year s. “ I n d u s t r i a l i s a t i o n i s t h e o n l y w a y y o u c a n c re a t e d e c e n t a n d s u s t a i n a b l e j o b s . Wo r k o p p o r t u n i t i e s a re i m p o r t a n t t o t h e e x t e n t t hat they provide oppor tunities for unem ployed p eo p l e to earn a n i n c o m e , b u t w e n e e d t o p u r s u e t h e c re a t i o n o f d e c e n t a n d s u s t a i n a b l e j o b s . T h i s w i l l e n s u re t h a t t h e S o u t h A f r i c a n
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20 YEARS OF SUCCESS | GOVERNMENT & BUSINESS
e c o n o m y c a n g ro w a t o v e r s i x p e rc e n t o n a s u s t a i n a b l e b a s i s . I f w e d o t h i s , w e c a n w i p e o u t u n e m p l o y m e n t a l t o g e t h e r. “ I w o u l d l i ke t o s e e P u b l i c E n t e r p r i s e s a d d r e s s i n g t h e i r b a l a n c e s h e e t c o n s t ra i n t s , a n d g e t t i n g i n t o m o r e s t r a t e g i c p a r t n e r s h i p s w i t h t h e p r i v a t e s e c t o r, i n a m a n n e r t h a t a s s i s t s c r e a t i n g j o b s and thriving manufacturing sector to suppor t the SMME sector and developing schemes. “I can see that their balance sheet in some ins tances can s e r v e a s a m a s s i v e c o n s t ra i n t , b u t I b e l i e v e w e w i l l o v e r c o m e t h o s e c h a l l e n g e s , a n d t h e g re a t e r s u p p o r t f r o m g o v e r n m e n t i n cer tain policies to suppor t s tate-owned com panies will see a massive change in how the balance sheets of the s tate-owned c o m p a n i e s l o o k . T h e re f o re , t h e y c a n u s e t h e i r b a l a n c e s h e e t to inves t in the economy to develop economic activity and s u p p o r t l o c a l i s a t i o n a n d i n d u s t r i a l i s a t i o n .” G i g a b a s a i d t h a t , a p a r t f ro m S o u t h A f r i c a c e l e b r a t i n g 2 0 y e a r s o f f re e d o m a n d d e m o c ra c y, s o m e o f t h e s t a t e - o w n e d e n t i t i e s a l s o h a v e s p e c i a l c e l e b ra t i o n s t h i s y e a r. “ S o u t h A f r i c a n A i r w a y s ( S A A ) t u r n s 8 0 t h i s y e a r a n d E s ko m t u r n s 9 1 t h i s y e a r. T h a t ’ s a n o l d g u y. W e w i l l h a v e d i f f e re n t s t a t e - o w n e d c o m p a n i e s i n v o l v e d i n o u r 2 0 y e a r c e l e b ra t i o n s . “ H o w e v e r, w h e n w e c e l e b ra t e d t h e 9 0 t h a n n i v e r s a r y o f E s ko m , w e d i d n ’ t j u s t d o a g a l a d i n n e r i n S a n d t o n . We t o o k E s ko m o u t t o i t s c u s t o m e r s a n d s t a ke h o l d e r s – t h e p e o p l e w h o b e n e f i t f r o m i t . E s ko m g a v e b u r s a r i e s t o y o u n g p e o p l e s t u d y i n g e n g i n e e r i n g a n d e c o n o m i c s . T h e y s u p p o r t F u r t h e r E d u c a t i o n a n d Tr a i n i n g (FET) colleges and other univer sities with vita l infra s tr u ctu re . T his i s w h a t w e’d w a n t t o s e e s t a t e - o w n e d c o m p a n i e s d o a s a p a r t of their contribution to the 20th annive r sa r y of ou r fre e d om. I t ’ s n o t j u s t a b o u t t h e p a r t i e s . H e d o e s n’t w a n t t o s e e a n y p a r t i e s i n c e l e b ra t i o n o f a n y t h i n g . H e w a n t s t o s e e t h e m c o n t r i b u t i n g t o w a rd s d e v e l o p m e n t – p a r t i c u l a r l y o f y o u n g people – because a 20-year-old dem ocra tic Sou th A fr ica ha s jus t come out of teenage-hood. “ W e a re a y o u n g p e r s o n i n o u r e a r l y 2 0 s , w h o i s s t i l l g r o w i n g ver y fas t, assimilating knowledge, s till at var sity learning a lot. What s tate-owned com panies need to do as par t of the c e l e b ra t i o n s i s t o i n v e s t i n y o u n g p e o p l e , a s s i s t g o v e r n m e n t , a n d d e v e l o p t h e p ro d u c t i v e p o t e n t i a l o f y o u n g p e o p l e .”
“ We m u s t l o o k a t t ransfor m at io n in it s b road e r se nse . Th is is n ot only in te r m s of e mpowe rin g black people, but also in te r m s of c ont r ib u t in g to chang ing t he fun da me n ta l st r uc t ure of t he S ou t h A f r i c a n e c o n o m y. . .”