Business Leadership South Africa (BLSA) was approached by former Eskom CEO Andre de Ruyter to help fund an investigation into alleged corruption within the company and, since then, SA Inc. has proved that it means business in its efforts to enable a capable state.
Busisiwe Mavuso, CEO of BLSA was recently part of a discussion with award-winning broadcast journalist, Alishia Seckam in the latest instalment of the Think Big webinar series. The series, hosted by PSG, aims to get candid opinions from societal leaders and titans of industry, in a bid to promote independent thought and critical engagement on the country’s most pressing issues.
“The public sector doesn’t have the resources, capability and the time that the private sector holds, so it’s important for us to step in and support where necessary,” says Mavuso. This stands to reason, as the stated purpose of BLSA is to build an environment in which globally competitive and nationally responsible companies can prosper, “Resolving the Eskom crisis is imperative and fundamental for improving our trading environment and growing our economy.”
She believes the solution lies in putting in place necessary interventions that will remove obstacles to inclusive, economic growth and job creation. To do this, the business alongside government has co-created and put forward what it believes to be a credible and adequately funded plan.
In cooperation with various state entities, the plan will focus on three key work streams: energy, transport and logistics, and crime and corruption. These are what business and government have concluded to be the priority areas of intervention – a finding that is based on a rigorous, analytical process.
And, as Mavuso explains, a targeted approach to tackling these three critical areas will be driven by clear objectives. “We refer here to the 80/20 principle, where getting 20% of matters right as a country would give us an 80% shift in the creation of a conducive business environment,” says Mavuso.
For instance, from an energy perspective, the initiative aims to unlock rapid generational capacity, improve the energy availability factor of Eskom, rapidly scale residential and commercial rooftop solar, and fast track gas to power. To achieve these aims, the business will lean on private sector capability to provide the necessary engineering expertise and support. Timelines for the achievement of these aims have been set and there are very clear tangible outputs.
“It is important that in these engagements we get to have robust and constructive conversations so that the implications of our decisions are clear to all,” says Mavuso.
She adds that the advantage that the private sector has is being privy to key investment conversations.
“We sit in boardrooms that they don’t; we sit with investors; we sit with the fund managers; and we do the investment road shows – and we have insight of the concerns of the investor and global community. And the overarching sentiment of the international community is that South Africa has mounting weaknesses which is a huge cause for concern,” says Mavuso.
She points out that the minimal foreign direct investment that SA is currently seeing is illustrative of these concerns.
According to Mavuso, South Africa used to be the gateway into Africa. However, she says that if the environment is not an enabling one, then capital quickly moves on to the next feasible environment – she points to an investment shift from South Africa to East Africa as an example of this.
“The private sector and government need to be driven by this notion that we’re losing credibility in the foreign business landscape, and we need to [focus on regaining our credibility] as the goal because if you can’t get investment, the economy is not going to grow at the right levels which means we’re not going to be able to address the approximately 46% unemployment rate (using the expanded definition),” she says.
She believes that the ability of this public-private sector partnership to “rescue” South Africa from its current crises will rest heavily on the government’s constructive use of its policy tools in support of the skills that the private sector contributes. But, she believes, the bottom line is that we’re looking at a credible plan.
In the months ahead, these measures will determine the future of South Africa’s vitally important network industries.
The need to abandon the developmental state agenda and focus on leveraging on the knowledge, skills, expertise, and capacity of both the public and private sector to get foundational institutions up and running again will be key to a positive outcome, says Mavuso.