Bonang Mohale: Treasury is in safe hands with new FinMin Mboweni

2018-10-19 22:00 - Lameez Omarjee, Fin24
Bonang Mohale, the CEO of BLSA. (Gallo Images / City Press /Leon Sadiki) ~ Gallo Images

Business Leadership South Africa (BLSA) has welcomed President Cyril Ramaphosa's choice in "tried and tested" Finance Minister Tito Mboweni, said the organisation's CEO Bonang Mohale.

Mohale was speaking at the South African National Editor's Forum gala dinner on Friday to commemorate Black Wednesday in Johannesburg.

During his address Mohale shared expectations for the mini-budget to be delivered by Mboweni on October 24. "We welcome President Cyril Ramaphosa's choice in the ministry of finance - a safe pair of hands in minister Tito Mboweni, tried and tested," he said.

Mohale highlighted things that need to be fixed. "In the medium-term budget our expectation to him (Mboweni), at a high level, is that he could help us root out and defeat state capture."

This could help save R100bn a year, which had been siphoned off to two families. "One being an illegal, immigrant, Indian family," Mohale remarked.

The second task for the finance minister is to reduce debt. SA's GDP ratio is above 50%, he pointed out.  

Thirdly, state-owned enterprises (SOEs) need to be fixed, Mohale said.

"We know our government is bloated," he said, before referring to former president Nelson Mandela's Cabinet which only comprised of 20 people. "This past regime had 37," he quipped.

SOEs are also far too big - Eskom has 15 000 employees too many. He said the structure of the power utility which is ambitious in being responsible for generation, distribution and transmission, compared to utilities in other parts of the world where these three functions are run by separate companies.

"When you do the math, it does not add up," he said. Eskom currently needs to borrow to serve interest payments on its debt, Mohale explained.

Government must also exercise "fiscal prudence and consolidation" as SA is in a "fiscal crisis" and can't be "extravagant". "We must tighten our belts," he said.

Finally, SA should also work on communicating a "positive narrative" to the world. "As South Africans we are our own worst enemies," he said. SA should take a lesson from Columbia. The country's president received the Nobel Peace Prize in 2016, because Columbia changed its narrative.

Columbia stopped telling the world about all the brains being blown out of drug lords heads, and instead told the world about the processes in place to achieve lasting peace, Mohale said.

As he concluded Mohale stressed the importance of education. "Education matters. As business we are going to pay attention to this." It unlocks knowledge and wisdom, a world of meaning, and a world which cannot be conquered without a "persistent crusader".

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