‘Empowerment no longer at the top of government’s list’ 

‘Empowerment no longer at the top of government’s list’ 

By Mpho Sibanyoni 

MphoS@sundayworld.co.za 


 

A meeting between President Cyril Ramaphosa and the Black Business Council (BBC) has failed to deal with reasons why the state is no longer serious about empowerment. 

Economist Duma Gqubule said this after the meeting at the Union Buildings in Pretoria, which discussed the immediate challenges facing the economy and its fundamental transformation. 

According to a joint statement from the presidency and BBC, the discussion centred on issues that have inhibited black business participation in contributing to the country’s development and economic growth. 

They also touched on energy security, transport, agriculture and the capacity of the state.  

Employment equity and transformation also featured prominently in the discussion, with participants reflecting on the 20 years of the B-BBEE Act and 25 years of the Employment Equity Act. 

Said Ramaphosa: “Since the advent of democracy nearly 30 years ago, we have worked to advance the economic position of black and women South Africans. That is why we introduced broad-based black economic empowerment, affirmative action, preferential procurement and other transformation policies to address the imbalances created by years of apartheid rule.  


“Our fiscal policies enabled a massive redistribution of resources towards mainly black South Africans through the provision of basic services, subsidised housing, improved education and health care and social grants.”  

BBC president Elias Monage said the organisation noted progress being made in processing the Public Procurement Bill.  

“We view this bill as a very important instrument and the BBC is happy that the bill, in its current form, after many fights, contains the set-asides in the primary legislation,” said Monage. 

The meeting agreed to establish five focused work streams, including inclusive economic transformation, funding of black small businesses, energy, transport and logistics and state capacity. 

“The work streams will be coordinated from the presidency, and the first quarterly report back will take place in March 2024.  

“President Ramaphosa reaffirmed the government’s commitment in addressing the energy crisis, logistics backlogs and crime and corruption by highlighting key interventions through the Energy Action Plan, national logistics crisis committee and the recently adopted Freight Logistics Road map.”  

However, Gqubule was not convinced, saying he was concerned why they never dealt with reasons about transformation being in reverse gear over the past 10 years. 

“BEE has fallen down to the bottom of the list of government priorities. The president never talks about black economic empowerment,” said Gqubule. 

He said financial services companies were no longer doing BEE deals as there were no incentives for them to do replacement in BEE transactions. Mines are responsible for the majority of the little black ownership we have on the JSE. 

“To all its intent and purposes, BEE is on its last legs, it is almost dead. I don’t think the government has the political will to confront the powerful interests in the mines and the banks and address the core problems we are facing in terms of the BEE policy.” 

“Banks and mines bullied government into accepting these policy compromises that basically killed the BEE policies.  

“There are very few BEE transactions on the JSE. And we are very far from transforming our economy.  

“It is time for stronger mechanism for dealing with quotas for employment equity because we are no longer dealing with skills shortages anymore.  

“Companies just don’t want to transform. They don’t address the total lack of funding for SMEs,” Gqubule said. 

He said the SME financing gap was (according to the department of small business development) about R350-billion … while the NEF and Sefa provided a small amount of funding to black companies.  

“National Treasury and the Reserve Bank should recapitalise development finance institutions if we are serious about expanding funding to black business,” said Gqubule.

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