Business Undertakes to Partner with Government to Accelerate Growth in SA
Wednesday, 24 February 2016
Ahead of Finance Minister Pravin Gordhan’s Budget Speech, SA business leaders have committed to working closely with Government and labour to help accelerate economic growth and job creation and strengthen public finances.
Business leader Jabu Mabuza today announced that the country’s major business groups would contribute senior-level expertise and invest in specific initiatives to avoid a credit rating downgrade for SA, accelerate growth of small and medium enterprises (SMEs) as a vital catalyst for job creation, and increase investment projects in key economic sectors.
Mabuza was speaking on behalf of dozens of CEOs who have met with Mr Gordhan and President Jacob Zuma in recent weeks.
“SA is at a critical economic juncture, with slow growth, high unemployment and real risk of a sovereign debt downgrade,” said Stanley Subramoney, lead convener of the initiative. “We are confident that the Minister of Finance will today announce bold steps to boost growth and strengthen public finances – and we are committed to working actively and urgently with Government and labour to support these steps.”
“We remain committed to the National Development Plan, which provides a compelling vision and framework for growth, and urge all social partners to focus on it as the vision guiding implementation” Vassi Naidoo added. “However, today SA business goes further and announces three specific initiatives to help translate the NDP into faster growth, new jobs, and greater economic inclusion.”
These initiatives are:
1. Preventing a ratings downgrade: Co-conveners – Mike Brown and Ralph Mupita
“Business understands that Government will play its part in avoiding the severe long-term costs to our country and all its people that a downgrade would create,” said Brown and Mupita. “As we have indicated to the Minister, we accept that business must play its part and we accept that there could be changes to the tax regime as part of a broader package of fiscal consolidation. As part of this, business is prepared to do more and bring private sector expertise to the Boards of state owned enterprises to help reduce their drain on the fiscus and position them to contribute positively to growth; participate in Public Private Partnerships in the energy sector and elsewhere; and play an active role in SA’s efforts to review regulatory blockages to promoting and attracting investment and starting and growing businesses, as well as increased efforts to combat corruption. ,”
2. Empowering Entrepreneurs and SMEs to accelerate their growth: Co-Conveners Adrian Gore and Brian Joffe
“If SA is to create jobs in the numbers we need, while accelerating economic transformation and reducing inequality, we must give our SMEs a major boost – in skills, capital, and access to export markets,” said Gore and Joffe. Business is ready to invest money and skills to accelerate the development of high-potential SMEs, and together with government, will support a single vehicle which will co-invest with existing successful enterprise development funds run by the private sector.”
3. Driving key investment projects in targeted sectors: Co-conveners Sim Tshabalala and Dan Matjila
“Business will work with government and labour to identify a core set of priority economic sectors and enterprises – both those made vulnerable during current market turbulence, and those that can unlock new growth,” said Tshabalala and Matjila. “For each sector selected, we will contribute private sector expertise to help create an urgent, detailed plan to remove barriers to growth, protect existing jobs, and drive inclusive growth as fast as possible.”
Mabuza said that more specific details of these three initiatives would be announced in the near future.
“SA business believes passionately in our country,” they said. “Now is the time to tackle our problems together, reinvigorate our economy, and show the world – once more – the greatness that South Africans are capable of.”
For further information, please contact:
1. Jabu Mabuza
2. Cas Coovadia