In order to incentivise banks and financers to start funding small to medium size businesses and/or small to medium size oil and gas companies, governments need to start understanding that collaboration is critical.
This is the word from Mtho Xulu, president of the South African Chamber of Commerce and Industry (SACCI), speaking on a panel discussion on financing projects on the African continent.
“Governments, I believe, need to start understanding that we live in a world of collaboration and some of the best ideas are sitting outside government,” says Xulu.
He explains that governments need to make sure that energy solutions are provided cost-effectively and sustainably.
“If they [government] can just focus on their policy instrument and implementation to make sure that there is affordability and sustainability, and then allow the private sector to be the ones to build, run and operate all infrastructure projects and develop opportunities, we will really go a long way.”
In the South African context, particularly concerning the country’s debt-ridden utility company Eskom, he says the issue is clear and that it can only be effectively addressed if there is a collaboration between the private and public sector.
“We have a lot of resources sitting outside government, waiting for the government to make a move,” he says, insisting that “governments must focus on making sure that people have access to affordable energy, and that does not mean that they must own the power”.
Bambili Group’s Nyonga Fofang agrees with the challenges the sector presents due to the complex nature of distribution models and says public-private partnerships are necessary because of the massive impacts they have on people’s lives whether they have or have not been put in place.
“You need to have some kind of a collaborative nature in terms of how you deliver that resource. Simple confidence-building measures in terms of appropriating opportunities between the private sector and government make a big difference.”