Gigaba, Patel meets SOE CE’s

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Ministers of Public Enterprises and Economic Development Malusi Gigaba and Ebrahim Patel Friday met the Chairs and CEs of the nine state-owned enterprises (SOE) reporting to the Department of Public Enterprises, including state arsenal Denel and South African Airways.

Gigaba’s office, in a statement, says the meeting was the “first of many envisaged dialogues on the role of the SOE in the New Growth Path (NGP) discussion” and “resolved that these entities should intensify their efforts to accelerate the pace of job-creation and skills development and training in their respective sectors.”

Denel spokeswoman Sinah Pochana says board chairman Dr Sibusiso Sibisi and Group CE Talib Sadik attended the meeting. But she could not immediately comment on Denel’s role in Patel’s NGP that will seek to add least 30 000 additional engineers by 2014 and 50 000 new artisans to the economy by 2015. “We have not received feedback as yet as to the expected role of Denel,” Pochana says. “We’ll advise once we have the necessary info.”

The state BuaNews agency last month added the NGP sets South Africa “an ambitious target of creating five million jobs and reducing unemployment from [the official] 25% to 15% in the next 10 years.”

Gigaba in his statement says SOEs “will be critical in our efforts to improve our competitiveness, accelerate our infrastructure investment programmes and reduce the cost of doing business, thus laying the platform for long-term growth. We must raise our investment levels on a sustainable and consistent basis if we are to support the State’s developmental objectives.”

His SOEs face a busy Christmas as they have until year end to prepare inputs on their contribution to the NGP, for further discussion at a two-day workshop to be held early next month. Gigaba’ office says SOEs will have to brief the minister on their infrastructure projects, giving a break-down by province and investment value per year. They will also have to provide detail on the numbers of jobs created during construction (including opportunities for labour-based construction methods), in the supplier industry, as well as how many are employed operating the facility and on its maintenance. Gigaba also wants facts on training, including targets for artisans, and the active use of training centres.

Gigaba adds that SOEs should also identify and pursue opportunities on the continent. He also commented on the need for improved co-ordination between SOEs and government. “Government must play a leadership role in unlocking opportunities for the SOE on the African continent. We must contribute to the development of the African continent, and identify key stakeholders and partners, both in the public and private sectors, to help us achieve our goals of better integration.”

The Engineering News, meanwhile reported Friday that private enterprise should “complement” the SOEs, particularly in areas where these enterprises are weak. “This approach was unlikely to overly enthuse the domestic business sector, with Business Unity South Africa (BUSA) having already questioned the appropriateness of government’s plan to further boost public sector involvement in the economy, as well as the creation of yet more SOEs in the resources and banking sectors,” the publication said. BUSA CE Jerry Vilakazi argued that the private sector, rather than the State, should play the leading role in economic growth, development and job creation.



But Gigaba says the “developmental State” at the heart of the ruling African National Congress’ agenda has the “objective of actively intervening in the economy to drive investment in targeted areas to achieve a long-term vision of a higher value-added, labour absorptive and racially integrated economy”.