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Minority privilege is unsustainable

Oct 23 2016 06:10
Fumani Mthembi

What does it mean to be a young black female entrepreneur? I am responding to the question as an operator in the independent energy-generation sector.

Currently, the sector is failing to advance some of our most critical national development objectives. The department of energy’s initiative, known as the Renewable Energy Independent Power Producer Procurement Programme, is a key vehicle for securing electricity capacity from the private sector for renewable and nonrenewable energy sources, as determined by the minister of energy. It has been hailed globally as a feat in state procurement.

Its role in supplying the power needed by Eskom to repair its old infrastructure – and bringing an end to the misery of load shedding – is well documented. In addition, it has consistently featured in state of the nation addresses for having attracted foreign direct investment and created jobs.

It is because of this programme that my four business partners and I were able to move from our garage start-up to become one of the leading independent power producers in South Africa. So, why would I criticise the procurement programme that made it possible for a young black woman like me to participate in our economy as an entrepreneur?

I critique it because I recognise that my private gain, in terms of my ability to participate in the programme, is less a reflection of the entrepreneurial genius of my partners and me than it is a reflection of our marginal privileges.

These privileges, which include access to information, networks, education and employment, are not common among South Africa’s black youth. Therefore, the fact that our participation hinges on minority privilege reveals that the sector carries a fundamental sustainability risk.

The programme has defined black people as “rent-seekers”. I use the term ‘rent-seeking’ to mean that we are deemed to be entrepreneurial for seeking out white or foreign people who have created value, and then attaching ourselves to them as “transformation partners”.

We are forced into this position as there are no institutions willing to free up capital for us to do the work of entrepreneurship – to organise all factors of production for the purposes of power generation. As a result, it is easier to raise R200 million to be a transformation partner to a white person than it is to raise R2 million to develop your own power project as a black player.

I am not making a case against BEE, but one for redefining the notion of economic participation. We need a state programme and procurement programmes that fund and incentivise our active participation, so that we may enter into opportunities as partners, not passengers.

Also, the independent power production sector has failed to invest the requisite resources into the development of energy communities. Despite decades of evidence that corporate social investment has failed to scale for impact, the state still seems unable to provide the correct level of governance for community development. Thus, where we already have a commitment exceeding R25 billion towards the development of energy communities, we run the risk of wasteful expenditure. This is because the state lacks the ability to transfer development priorities, guidelines for engaging communities and impact targets to the private sector.

These flaws are not unique to the energy industry. They permeate the economy, reflecting an absence of a coherent, state-led vision for development. Specifically, it is the unique contribution of business in general – and black-owned businesses in particular – that is poorly articulated. Yet our historical context provides sufficient clarity on this question.

South African businesses should exist to innovate for development. They should be judged and supported on their ability to advance the African renaissance – the restoration of Africa’s place among other civilisations.

What is it like to be a young black woman working in this sector? It is an honour to be at the coalface of one of the country’s newest industries and to use my position to advocate the just inclusion of all who reflect the beauty and genius that is Africa.

* Mthembi is a co-founder of the Pele Energy Group. She oversees its research and development consulting subsidiary, Knowledge Pele

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