BBBEE Collaborative Approach to Growth for all through Infrastructure Development

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BBBEE - Collaborative Approach to Growth for all
through Infrastructure Development

• Vuyo Mahlati
• 29 August 2006
• Free State Province

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CHALLENGES

• Public Private Sector Priority, Resource
  Budget Non-alignment
• Eastern Cape Infrastructure R2,9billion budget
  for 2006/7 has no training component
• Growth of the Construction Sector and Skills
  Shortage
• Lawless (2005) conducted a census of all local
  and district municipalities and metros which
  yielded the following statistics
• No civil professionals
• Of the 231 local municipalities 79 have no civil
  engineers, technologists or technicians
• Of the 47 district municipalities 4 have no civil
  engineers, technologists or technicians
• Only one civil technician
• Of the 231 local municipalities 42 have only one
  civil technician
• Of the 47 district municipalities 4 have only one
  civil technician

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Implications for BBBEEFacts (2003 2004 Fyr)
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Enterprise Challenges

• Inappropriate procurement procedures and
  processes with inefficient systems
• Access to working capital
• Access to equipment
• Capital to buy Equipment
• Poor business /or technical skills
• Poor Project Management skills

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Accelerated Shared Growth Initiative for South
Africa (ASGI-SA)
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1. Background
Main challenge in current period

• To identify and clear constraints to higher
  economic growth

• Social partners jointly to commit energy and
  resources

ASGI-SA

• Set of concrete economic proposals NOT an
  overarching economic strategy
• Should be understood against the backdrop of
• Govts PoA
• Decisions of the 2003 GDS
• MERS

• Further work required to put proposals in
  practice, in a partnership among all economic
  role-players
• To be further sharpened in the context of
  defining a broad industrial strategy
• Many other proposals, deserving inclusion, will
  emerge during further consultations among social
  partners and in elaborating new municipal IDPs.

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Achieving balanced sustainable growth
Isolating key constraints
Binding constraints that inhibit movement to a
higher range of investment, job-creation and thus
economic growth
Cost and efficiency of national logistics system
and some infrastructure
Deficiencies in state organisation, capacity and
strategic leadership
Barriers to entry and competition in sectors of
the economy
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Infrastructure development
Leverage of SOEs assets

• Use of assets and initiatives of SOEs to leverage
  further economic activity

• Utilising property portfolios of SOEs to catalyse
  major urban and light industrial development
• Portfolio of new investment opportunities related
  to port and rail infrastructure, incl. IDZ
  packages, airports, rail and tourism network
• New growth areas, e.g. the PBMR to leverage
  investment as part of an overall industrial
  strategy

Interventions to impact the second economy

• Trains passenger/citizen
• Rural business process outsourcing

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The ASGI-SA Challenge
reaching social targets and objectives below, by
2014, through sustained and strategic economic
leadership and effective partnerships.
Workshop Objectives

• Halving poverty rate to less than 1/6 of
  households
• Reducing unemployment to below 15
• Achieve 5 average growth rate 2005-09 4.5
  2010-14 6

Issues for Discussion
ASGI-SA

• Increasing FDI in both the Macro and Second
  Economies

ASGI-SA
IIC
National Programme for the Creation of Small
Enterprises and Jobs in the Second Economy

• Create 1,000,000 jobs for poor people in rural
  and peri-urban areas within 3 -5 years

The Second Economy
Programme Strategy - Partnership Development
Challenges
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Emerging Initiatives

• Provincial Integrated Infrastructure Plan
• Free State Inter-Governmental Infrastructure
  Summit summit intention to strengthen the
  Provinces capacity and determination to deliver
  integrated services, such as
• Engineering services
• Social services
• Land and Housing services
• Transportation services
• Economic services
• Information Technology and communication services

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RecommendationsCollaborative Approach
(Public-Private, Local-Province-National)

• Alignment of Initiatives, Plans and Budgets
• Linking Growth, Skills Development and Job
  Creation
• Procurement for Growth and Development
• Develop a dedicated Emerging Contractor Support
  Programme
• Provide Technical Assistance to SME in the
  Construction Industry
• Facilitate a partnership between Government and
  Financial Institutions
• Benchmarking, Tracking, Monitoring Accounting