Captains of industry in South Africa have resolved to collaborate with the government in tackling the country’s major bottlenecks in a bid to attract investment, create jobs and grow the economy by 3% a year.
This comes after President Cyril Ramaphosa met with CEOs from various sectors for an update on progress with their efforts in tackling the country's economic crisis.
Leaders of Business Unity South Africa (Busa), Business for South Africa (B4SA), and Business Leadership South Africa (BLSA) yesterday said they had identified three priority areas to turn the tide against the low growth trap.
They said the energy crisis, transport and logistics challenges, and crime and corruption were South Africa’s albatross to meaningful economic growth.
B4SA steering committee chair Martin Kingston said research conducted by PwC and Sanlam demonstrated that if progress was made within the three focal areas, they were likely to make a contribution of at least at 3% to the gross domestic product (GDP).
Kingston said a higher rate of economic growth is essential to create meaningful jobs, the majority of which were within the private sector.
He said business agreed that there was a window of opportunity to urgently implement initiatives in these priority focal areas to reverse the economic downturn and rebuild confidence in the country’s trajectory.
“There is still much to be done and many specific interventions to be agreed and urgently, and properly, implemented,” Kingston said.
“Added momentum and impetus will be provided by harnessing the combined skills, expertise and other resources of the business community, which we firmly believe will help reset the country’s economic and social path.
“South Africa no longer has the benefit of time to address these issues and all B4SA workstreams will continue to focus on urgently driving the immediate, rational and pragmatic choices to guide our collective actions, ultimately to achieve economic restoration and sustainable, inclusive growth for all South Africans.”
The meeting between business and the government agreed to expedite the passage of the Electricity Regulation Amendment (ERA) Bill within the Sixth Parliament, following its tabling in the National Assembly last month.
The meeting also agreed that the ERA Bill was crucial to ending load shedding, expediting energy development, expanding transmission infrastructure, establishing a competitive electricity market, and attracting investment in the energy sector.
Business’ support has been mobilised in critical areas, including Eskom technical support on optimising the diesel supply chain at Ankerlig power station, supporting the return of additional units at Kusile and four key power stations to assist power station managers with turnaround plans at those facilities.
Business technical teams are working through the National Energy Crisis Committee to assist the planning and implementation of key energy reforms, including planning for efficient grid access and expansion.
All these interventions aim to recover 5 400MW over the next 12 months.
In logistics, the National Logistics Crisis Committee (NLCC) has established four Corridor Recovery Teams focusing on strategic commodity export supply chains in coal, iron ore, manganese, chrome and magnetite to jointly address performance constraints.
An additional Container Corridor Recovery team is being constituted with representatives from all major shipping lines, agriculture and automotive sectors.
The Joint Initiative against Crime and Corruption (JICC) has also been constituted, and the Business Against Crime South Africa (BACSA) is being established as an independent structure and will coordinate the interface with the government.
A special purpose vehicle for establishing digital and data forensic capabilities for the National Prosecuting Authority (NPA) is also being set up.
Busa CEO Cas Coovadia emphasised the importance of adhering to established time frames and achieving deliverables for each priority area.
“The focus is on achieving agreed targets and improving performance in key action areas,” Coovadia said.
“If we neglect or delay critical decisions needed to accelerate our much-needed growth ambitions to build the economy and tackle poverty, inequality and unemployment, there will be many more years of challenge, frustration and despondency. We need to act, together, with immediate urgency.”