Business cannot wish away the sovereign – Deputy FinMin

2017-10-27 14:09 - Carin Smith
Deputy Finance Minister Sfiso Buthelezi. (Photo: Carin Smith)

Cape Town - Government needs businesses to work with them to create a new social contract for growth and transformation, Deputy Finance Minister Sfiso Buthelezi said on Friday.

South Africa needs to legislate to create an enabling environment, he said at the African Infrastructure Dialogue.

“We need business to work with us for a new social contract for growth and transformation. Business cannot wish away the sovereign, but can use good governance and build expertise,” said Buthelezi.

“We are aware that the private sector is an engine for growth. Issues mentioned include that trust is not there from business, but we need to work together with business and government to deal with this. We cannot outsource (to business), but we must work together.”

Agriculture is another important sector for him.

“The colonial legacy also remains with us in Africa. We suffer a shortage of infrastructure and infrastructure is critical to the development of the African masses,” he said.

Only 35% of people in Africa have access to electricity and in sub-Saharan Africa road infrastructure has actually declined, he said.

“Key infrastructure will unlock opportunities. Where infrastructure abounds, communities prosper. Procurement is also very important in this regard,” he said.

“Especially women and black people should be used in infrastructure development.”

Buthelezi added that it is “important for us to maintain the expenditure framework in SA”.

Treasury revealed in its mini budget this week that South Africa would breach its spending ceiling by R3.9bn, which required them to sell assets like shares in Telkom and cut projects to ensure the state maintains the expenditure framework.

“We might have to cut some of our projects. Yet, we cannot just do that. We have to grow our prosperity,” he said.

Private sector cannot avoid the government

Meanwhile, Harith chairperson Jabu Moleketi said in his address that the private sector cannot avoid the government.

“The private sector must become friends with the sovereign, but it must understand that there is this thing called 'capture' in South Africa,” said Moleketi.

“So, you (the private sector) must still retain your objectivity, look for returns and not become just an extension of the sovereign.”

Moleketi said successful public-private partnerships needed collaboration

It needs people “who cannot be shaken down”. It needs people who can raise capital, but also mitigate risk, including in the types of partners they take on.

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