Attendees at the October B4SA gathering where the positive energy was palpable
3.3% Growth by end 2025 and 1 million jobs by 2030 – Possibility or a pipe-dream?
Ray Mahlaka of the Daily Maverick writes “If Eskom blackouts end permanently, crime and corruption are successfully prosecuted, and Transnet’s logistics get back on track, business leaders hope to see economic growth of 3.3% by the end of next year. Note: This is a summary of the full article below.
https://www.dailymaverick.co.za/article/2024-10-01-heavy-hitter-ceos-target-eye-watering-economic-growth-by-end-of-2025-and-a-million-jobs-by-2030
“By 2025, SA’s economy could grow by 3% and create more than 1 million new jobs if the partnership between business and government continues to address crises in electricity and logistics, and crime and corruption.
This is a projection offered by SA’s prominent CEOs, who committed to mobilising financial resources and lending their expertise to the government over the coming years to help halt the country’s economic slide.
In June 2023, organised business (comprising about 150 CEOs) pledged its support to the government (B4SA), offering expertise and money (mobilising R250-million) to fix the country’s problems in three key areas: electricity, transport and logistics, and crime and corruption (Phase 1). https://www.sagoodnews.co.za/the-130-pledge-ceos-what-have-they-achieved/
President Cyril Ramaphosa and Discovery CEO Adrian Gore at the Industrial Development Corporation in Sandton on Tuesday, where Phase Two of the government and business partnership was launched. (Photo: Siyabulela Duda, GCIS)
On Tuesday 1 October, the CEOs pledged to launch Phase Two of the partnership with the government, saying they would focus on:
· Permanently ending Eskom’s rolling blackouts,
· Lending assistance to Transnet to run trains and ports,
· Helping law enforcement agencies investigate and prosecute complex corruption-related crimes.
If these initiatives are accelerated, they have the potential to lift economic growth, create jobs and improve sentiment and overall investment flows towards SA, the CEOs said.
Eskom blackouts that have persisted for 16 years, crime and corruption that festered during the State Capture years, and Transnet’s inability to rail goods to markets have held back South Africa’s economy.
Stretch targets
At Transnet, processes are under way to partner with the private sector to run trains and ports independently for a set period, while pouring in money to upgrade the flailing logistics infrastructure.
At Eskom, there is a renewed focus on monitoring the performance of power stations, which has resulted in no blackouts for more than six months.
Renewable energy, The private sector is working to deliver about 22GW (22,000MW) in the coming years, which would end the electricity crisis.
Crime and corruption, business has offered expertise (even forensic) and raised more than R50-million to help law enforcement agencies investigate and prosecute complex corruption-related crimes at an “arm’s length basis”. The 10111 police line was capacitated with more resources to respond to crime-related incidents.
Digital spectrum was auctioned, after 18 years of inaction, which brought faster internet speeds and lower mobile data costs.
Discovery CEO Adrian Gore said the mood and narrative around SA had changed since Phase One of the partnership with the government. “There is a feeling that things have changed. We need to accelerate the partnership and do more. The second phase will be about economic growth and jobs. It can be done if we push very hard, of the one million jobs set to be created by 2030, organised business wants 400,000 to be specifically created for young people.”
The Action Plan
Several things will have to happen to lift economic growth and create jobs.
Energy: the government and business want to improve the performance of Eskom’s power plants so that they maintain an energy availability factor (EAF) of more than 64%. Private sector investments worth more than R23-billion are needed to boost the renewable generation capacity to 4GW and construct 1,000km of new transmission lines.
Transport and logistics: by 2025, investments worth R28-billion need to be unlocked in rail infrastructure. To grow exports and attract investment, rail capacity needs to increase from a projected baseline of 170 million tonnes to 193 million tonnes.
Crime and corruption: the focus of the partnership between business and government is to get SA removed from the Financial Action Task Force’s greylist.
Expectations going forward;
There was an expectation that the CEOs would take on more problems under the second phase
The water crisis,
Improvement in basic education standards in the public sector
Increased support for early childhood development programmes
Business for South Africa (B4SA) steering committee chair Martin Kingston said the CEOs had faced pressure to increase the number of priority areas, but decided against it.
“We might expand the areas in the future,” said Kingston. DM
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Ray Mahlaka of the Daily Maverick writes “If Eskom blackouts end permanently, crime and corruption are successfully prosecuted, and Transnet’s logistics get back on track, business leaders hope to see economic growth of 3.3% by the end of next year
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