Ramaphosa wants a new trajectory for B-BBEE

Says structural flaws still prevent black entrepreneurs from equitably participating in the economy.
President Cyril Ramaphosa speaking at the inaugural Black Industrialists and Exporters Conference in Sandton on Wednesday. Image: Fikile Marakalla/GCIS

President Cyril Ramaphosa wants to see a new and improved trajectory for broad-based black economic empowerment (B-BBEE) and feasible proposals detailing how to leverage capacity and resources from across society to bolster transformation.

“We want a frank conversation about impediments to the expansion of black business, not just from government, but from the private sector as well,” he said during an address at the inaugural Black Industrialists and Exporters Conference in Sandton on Wednesday.

Read: Presidential advisory council to ward off anti-BBBEE rhetoric

Ramaphosa noted that South Africa has not yet dealt with the structural flaws of the economy, despite working towards the Freedom Charter’s vision for all to share in the country’s wealth.

The president said that in other upper-middle-income countries, small and medium enterprise (SME) employers and self-employed people make up around a third of all employed people in rural areas, and one in seven in towns.

However, in South Africa the figure is just over one in 20, in both rural and urban areas.

“According to modelled estimates from the International Labour Organisation, business owners in South Africa plus family members who work for them make up just 17% of total employment. This is compared to 46% in China and an average of 31% in other upper-middle-income economies,” he added.

Speaking to the bosses of around 650 black-owned companies at the conference, Ramaphosa said the black industrialist’s strategy is underpinned by a commitment to secure greater diversity in the ownership and control of the economy.

This includes the promotion of emerging enterprises to drive “inclusive industrialisation”.

“Over the past six years, the Department of Trade, Industry and Competition [dtic], the Industrial Development Corporation, the National Empowerment Fund and other agencies have supported approximately 900 black industrialists,” he said.

Read:
NEF approves over R1bn in July unrest funding for black businesses
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“Over the past 11 years, black enterprises have been supported to the value of R55 billion.”

However, Ramaphosa stressed that there are still barriers preventing black entrepreneurs, particularly women, youth and people with disabilities, from meaningfully and equitably participating in the economy.

Value chains

“They [the barriers] are particularly challenging for entrepreneurs in townships and rural areas. These entrepreneurs have difficulty accessing finance, markets, technology and infrastructure. There is red tape and other bureaucratic obstacles,” he added.

The president said there is also the issue of concentrated economic and ownership patterns, and exclusion from major value chains.

“For this reason, even as we celebrate black entrepreneurial success, our eyes must look towards the horizon … We need to talk about private sector procurement, about value chains, about access to financing for emerging black business and about how existing systems militate against black business.

“We need to talk about the inefficiencies in the economy that affect established and emerging businesses alike.”

Ramaphosa also said there is a need to act decisively and urgently to end load shedding, saying that black industrialists cannot grow without a reliable supply of affordable energy.

Read:
SMEs need urgent support
‘State of SA’s economy keeps me awake at night’ – Ramaphosa
Women-owned petrochemicals group acquires bpSA’s East London terminal

Minister of Trade, Industry and Competition Ebrahim Patel launched the Black Exporters Network during the conference. The initiative intends to increase the volume of exports and create local jobs.

Patel said South Africa exported R1.8 trillion worth of goods in 2021, a record performance which represented almost a third of the country’s gross domestic product.

Commenting on boosting export-led growth, Ramaphosa said the country’s achievements through the Black Industrialists Programme, which has funded black-owned companies since 2016, and other initiatives must act as a springboard to achieving higher rates of economic growth, social transformation and common prosperity.

“Through this conference we want to establish a practice of recognising and celebrating black excellence in the economy.”

Nondumiso Lehutso is a Moneyweb intern.

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There is no ‘briad based’ whatsoever and the construct is just a vector for corruption and mismanagement, so the best trajectory is to terminate it.

Let’s go back to the basics and ask one fundamental question. What would happen to the concept of BEE when there are no white people left in South Africa? Think about that one for a while.

We only have BEE laws because there are white people around. The track record clearly proves that BEE is not about broad-based empowerment at all.

In effect, BEE is a narrowly-focused project of discrimination against white people. BEE is similar to the handicap system in golf. It helps incompetent amateurs to compete with professionals. Professional and competent black individuals don’t need BEE. They are successful, and efficiently serve consumers on their own accord.

So, who needs BEE laws? The incompetent amateurs who cannot serve consumers efficiently, and who are a drag on the system, need BEE laws to boost them. BEE laws is a cost to the economy that strangles real entrepreneurs to give oxygen to dead entrepreneurs.

The only viable method to empower people is through employment opportunities. The inefficiencies of BEE projects consume capital savings, and as such, consume job opportunities. BEE is a process that shifts broad-based empowerment through employment to narrowly-focused enrichment of the political elite. BEE parasitizes the unemployed youth.

Looking at the jobless rate, BEE has been the biggest disempowerment disaster to have hit the nation. BEE is a step back towards petty apartheid. It is a crime against the unemployed youth of the nation. BEE is a socialist project that delivers broad-based disempowerment.

Structural flaws preventing black entrepreneurs from equitably participating in the economy? Frankly, 9 biggest problems faced by black entrepreneurs are:

1. Poor Planning
2. Roles and responsibilities not correctly assigned
3. Failure to communicate the company’s vision and goals effectively
4. Lack of proper systems
5. Space Limitations
6. Need to Hire New Employees
7. Financial Challenges
8. Outdated Practices
9. Poor Customer Service

Maybe the biggest impediment that should be addressed is the entitlement attitude. Anybody waiting for some entitlement benefit is always going to lag behind somebody using initiative and hard work to move forward.

With a worth of some $400mn and his F&F like Patrice Motsepe in the billion dollar league, the disjunct seems to be from the side of the ruling cabal, not the struggling white skinned entrepreneurs.

BEEE – proudly destroying SA for 20 years and counting !!!!!

A political-economic system can either empower consumers, or it can empower certain politically connected interest groups, but it cannot empower both at the same time. Either the customer is king or the politician is king. The economic policies can empower the unemployed masses by creating jobs, or they can empower the political elite by redirecting resources to cronies.

Take Eskom and SAA for instance. Both these SOEs were/are prime examples of the enrichment of beneficiaries of the BEE project. Where did that leave the taxpayers and the customers of these institutions? BEE is not economically viable, and it certainly is not politically viable either. For how long will voters, who are consumers, customers, and clients, support a system that enslaves them to the political elite?

The socialist politician bribes his way to the top through the patronage network that plunders consumers to reward cronies.

Let’s have a truthful discussion as to what a “Black Entrepneur” really is?

What I see is whole lot of Black Middlemen with access to the work, just passing it onto some unsuspecting Value Add Service provider, who does the work and seldom gets paid for it. I heard another story just this morning, involving the repairing of SAP Vans!

So whilst there are obviously genuine one’s out there, there are 10 of the above for every one genuine one, and the genuine one’s do not want to deal with their own people for fear of exactly what I have mentioned! I have a brilliant Black partner in one business who tells me not to deal with his own people due to his own experiences!

That’s what BEE brings to the table- Easy “sit at the coffee shop all day” money for some, and a lot of heartache for the majority!

The bulk of these “industrialists” are merely black tenderpreneurs that add a 20% fee as the middleman to real companies !!!!

BEE is value intercept or undue premium, not value add.

The impediments he speaks of, are those the very same ones created by his corrupt and inefficient government. Are these the very same impediments which prevented him from accumulating obscene amounts of wealth, pray do tell Mr President. Nothing that comes out of his mouth is credible.

How I would love to have a small chat with this Chaps PR company and Speechwriter!:)

After almost 30 years of enforcing the ANC race quota ideology, the impact of economically unsustainable population growth over many years on poverty, inequality and unemployment is still blindly ignored. To the contrary, social grants promotes undisciplined family planning which exaserbates inequality. It is more rewarding to target the white minority with race quotas than to provide leadership to our people regarding the long term benefits of responsible family planning.

the next government will likely shred the program after 2024 so don’t bother fixing this one’s trajectory

I have done business with 2 such businesses, both of which were recipients on this funding. One has been liquidated and the other is currently under business review.
Who has sucked hind tit here …… me and you the taxpayer, not the recipients or the funders.

Perhaps the BEE industrialists and entrepreneurs are not good enough to survive in an open market. Is that frank enough?

BEEE = Bloody Empty Economic Excuse!
Until we rid this country of racist BEE policies we will not survive.
CR’s statement is merely a voting ploy to keep the masses engaged
Finished and Klaar

End of comments.

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