Nene: Business, govt must work together

Nene: Business, govt must work together

2014-06-24 19:40

Johannesburg - The private sector and government must work together to grow South Africa's prosperity, Finance Minister Nhlanhla Nene said in Johannesburg on Tuesday.

"While the global economic outlook has improved moderately, South Africa cannot rely on external developments to alleviate domestic growth constraints," he said in a speech prepared for delivery at a KPMG forum.

Collaborative partnerships across society were needed to stimulate the economy, which needed to be more competitive, diverse, and inclusive.

"The next phase of growth is about the dynamism and agility of the private sector and the synergies between the private sector and government," he said.

This would lead to more job creation and greater revenue generation.

In the last quarter of 2013, 5 500 formal jobs were shed in the private sector, mostly in the finance, insurance, real-estate and business services sector, and the mining sectors, he said.

"Of the total mining sector contraction of around 25% in the first quarter, the drop in platinum production as a result of the strike accounted for about 19 percentage points."

The Association of Mineworkers and Construction Union signed the wage agreement with  Lonmin [JSE:LON], Impala Platinum (Implats) [JSE:IMP] and Anglo Platinum (Amplats) [JSE:AMS], on Tuesday, bringing an end to the five-month strike.

"The ending of the strike in the platinum sector should have a positive impact on sentiment and ultimately economic growth."

Nene said the country's constrained electricity supply had detracted from the growth potential and impacted investment decisions, but Eskom was expected to commission the first unit of its Medupi Power Station by the end of the year.

"The National Development Plan provides us with a menu of options to boost our development and growth prospects. The business before us now relates to the prioritisation of options and working through some tough trade-offs," he said.

Government had unveiled a number of measures to improve the competitiveness of the private sector, which would help build a more stable macro-economic environment.

For example, R847bn from the national budget had been allocated for infrastructure investment over the next three years.

Companies with operations in the rest of Africa would benefit from a simplified tax and foreign exchange framework, and the cap of these benefits would be upped for listed companies.

The labour force, government, and private sector each had roles to play to reach the balance needed for stronger economic growth and job creation.

"We must find a balance between meeting the earnings expectations of shareholders, the realisation of vision of economic transformation required by the electorate, and occupying our rightful place as global corporate citizens," Nene said. "Such a balance is possible."

  • Getafix - 2014-06-24 19:50

    Well, The way I see it, The business works hard, and then the moola is handed over to you know who. Who is actually doing the work here? So mabe the title isn't so fitting from this point of view. Unless they saying they actually going to do some work for a change.

  • lacrimosewolf - 2014-06-24 20:06

    Ag more of the same tired, raggedy speeches over the last 20 years. Really, whoever these speech-writers are they should be shot. Business Must, People Must, Youth Must. But what government Must remains unfulfilled.

  • Khumo William Monosi - 2014-06-24 20:13

    That's what india is doing. They discuss de economic programme of de government with the business. If white capitalist are willing, soouth africa will b number 1 in africa. White south africans must take part but they r not coming forth

      John Williamsii - 2014-06-24 20:39

      Listen: Asia has the world's 2nd largest economy: China, it has the world's 3rd largest economy: Japan. It has the Asian tigers: Malaysia, Indonesia, South Korea etc. It is a SUPER economic block where billions of people save and invest in businesses and employees in that region. South Africa is located 12000 km from the US, China, UK, Japan etc. The 5 million whites CANNOT grow this economy faster! CANNOT! CANNOT! The savings of South Africans are not enough to start businesses, the skill levels are too poor to produce most products. The region is POOR. Southern Africa is poor! Poor, poor! Far from the world's markets. Foreign direct investment is needed!

      Fortes Fortuna Adiuvat - 2014-06-24 21:03

      The average south african (out of the 50m people that are here) are some of the most unproductive people in the world. You cannot build if that remains the case. We need to abolish protectionist labour legislation and increase productivity. That will reduce unemployment by allowing business to be less cautious to employ people, especially the youth. It will allow the youth to enter the market. Then they will be better able to educate their children and so on. Right now, we are rewarding laziness. Giving people free things provides an incentive not to work.

      Naas Du Plessis - 2014-06-25 09:04

      Cause we are pushed away completely by the government.

  • John Williamsii - 2014-06-24 20:18

    Lower all taxes, personal and business taxes to 15%! Economic boom! Watch businesses grow at incredible rates, see investment like in Singapore! Hong Kong! Food and jobs for all! Wealth creation, requires just one thing: low taxes!

  • Melck - 2014-06-24 20:50

    Mr Nene - please explain why would business want to work with you and your government - 1) You have put labour laws in place that makes it impossible for small and medium businesses to employ people 2) If a business does not comply to our BEE ratings you do not do business with them - does you must employ a person whom is not capable of doing the work, pay them a very high salary then you can do business to be paid 120 plus days when you are lucky otherwise 24 months. 3) Now comes the best you must build the business so that by April next year the people working for you can take 50% I think you must go play on the highway where there is big busses.

  • Sydney Horn - 2014-06-24 21:11

    What he is actually saying is that business must do all the work, earn all the money and then government will help steal and waste it !

  • Kamogelo Majoe - 2014-06-25 00:11

    the best way to grow our economy is ensuring that all the sectors of the economy are productive.

      Malcolm Nicolson - 2014-06-25 02:15

      We can start with getting MP's to do their work, government departments that fail to deliver books or water, government companies like ESKOM, SAA, SABC.

  • Malcolm Nicolson - 2014-06-25 02:09

    Farms are part of the private sector, but they want to take it away. What other businesses will they want to take away? They have talked about the mines. Do I want to invest in, work and sweat over something they may come and take away from me? The red tape they have created, all those laws of employment for example have made their effect on businesses, reducing their efficientcy. How many times have I heard businessmen that had productive business, with all the red tape, give up and close down their businesses? Does the government see what they are doing? Or is it for the sake of votes to stay in power and live with the consequences.

  • Naas Du Plessis - 2014-06-25 09:12

    And what about bbbbbbeeeeeeeeeee. So I must give my company away that I worked so hard for. I was not part of apartheid so therefore these laws do not apply to me. I didn't do anything wrong in the past so why must I be penalised.

  • Felicit√© Thipe - 2014-06-25 09:34

    Ah, Mr Nene that song is sung all the time,yet South Africa doesn't want to understand it. It's a real pity. Educated and uneducated knuckleheads galore in SA.

  • Freddie Miller - 2014-06-25 11:11

    The ANC created the current environment of slow growth through their misguided, socialist policies. Fix the LRA as a first step, then we may think about investing our hard earned capital.

  • James N Catherine Coackley - 2014-06-25 11:21

    And tell us Mr. Finance Minister.....Where do the unions and the commies fit into your puzzle?

  • Peter L' Estrange - 2014-06-25 17:58

    I would guess that the huge infrastructure spend will encourage many small entrepreneurs! How? With all the red tape involved in a small business and the labour law constrictions who in his right mind is going to start a small business?

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