Why is government planning on developing and supporting only 100 black industrialists? This is the question put by the Treasurer General (TG) of the African National Congress (ANC), Comrade Zweli Mkhize put to the Presidential Advisory Council on Black Economic Empowerment in a meeting held in Johannesburg this past week. The meeting was held as part of the stakeholder engagement processes ahead of the ANC’s National Policy Conference to be held in Johannesburg from the 30th June 2017.
The Presidential Council is established in terms of the BBBEE Act and met with the ANC Treasurer-General to provide an update on work done in the implementation of the Charters, identify areas for policy review and exchange ideas on how to accelerate inclusive economic growth and job creation.
The Council has established work streams to coordinate its work being a focus on the Preferential Procurement Policy Framework Act (PPPFA), the Black Industrialists Programme and Radical Economic Transformation amongst others.
The Black Industrialist Program was launched by the Department of Trade and Industry (DTI) to catalyze the participation of black (African, Indian and Coloured) people in the “origination, creation, significant ownership, management and operation of industrial enterprises that derive value from the manufacturing of goods and services at a large scale”. According to the DTI, the program would shift the demographic composition of South Africa’s industrial sector to allow the country to take advantage of its resources and diversity as a nation.
At its inception the DTI committed to work with entrepreneurs to create 100 black industrialists by March 2018. Reasons cited for this ceiling were available resources, and the need to manage government’s ambitions within the reality of what is feasible. Once take up and interest from entrepreneurs had been established, government would then seek additional funding to drive this program.
“Much more must be done to effect fundamental and radical change in the economy; 100 industrialists just isn’t enough” say Mkhize. “In 2017, unlike in 1994, there are thousands of black professionals, technicians and entrepreneurs who have the requisite set of complex skills and industry experience as well as track record of outstanding achievements to be trusted to become competent industrialists”.
According to Mkhize, “Many more entrepreneurs have proven themselves in operations, and financial institutions. Investors should show confidence by supporting them to be industrialists. This will bring about the inclusivity that will deracialise the ownership patterns and bring in more new players from disadvantaged communities into the real economy.”
The meeting also agreed that the Black Industrialist program must also support and be integrated into other government programs to expand manufacturing capacity for employment creation. There should also be discussions on the key tenets of the programme, including the need to expand the sectors supported through the program.
Members of the Council decried the R15m cap for financial support and committed themselves to continue engagement with government in this regard. Black professionals and black businesses stand ready to assist government in the implementation of the programme.
Amongst other issues discussed for input into the ANC NEC Economic Transformation Subcommittee towards the Policy Conference include the review of the Preferential Procurement Policy Framework Act (PPPFA). Specially the need to call on government to withdraw Practice Note Number SCM 2 of 2006 which prohibits set asides.
“We have a progressive constitution that allows for redress and addressing the historical injustice. We must make sure that our regulations allow scope to achieve transformation and use of state levers, such as preferential procurement to bring black people, especially women, youth and the rural poor into the economy” says Mkhize. “This is not a new matter and we commit to resolve it speedily.”
The African National Congress will hold its 5th National Policy Conference from the 30th June to the 5th July 2017 where all these matters are expected to be discussed to develop recommendations towards the National Conference in December.