14 September 2006, Graceland, Secunda
Programme Director,
The MEC for Economic Development and Planning, S W Lubisi,
The President of NAFCOC Mpumalanga, Mr Sydney Kunene,
The leadership of NAFCOC, both from the Province and National,
Distinguished Delegates to the 2006 Provincial AGM,
Chamber Representatives,
Ladies and Gentlemen
We meet here tonight, more than three months after the Summit co-hosted by NAFCOC and government in Loskop early this year. The relationship between NAFCOC and government has matured to a point where not only do we see eye to eye on a number of important issues confronting our country and people, but where we do not agree, we are able to productively debate our different points of views. The recent conference that we jointly hosted to strengthen the partnership towards better service delivery, attests to this.
The Conference was convened to enhance efficient and effective service delivery in the Province by addressing the challenges faced by both Government and Business. We emphasised the need for cooperation between us to enable Government to achieve its goals, which amongst others include the halving of poverty and unemployment by 2014. Towards this end Conference adopted a declaration in which Government and Business committed themselves to working together to address the challenges identified.
Some of the challenges outlined at the conference included the following:
• To address challenges faced by SMME's in delivering services sourced by government from the private sector.
• To answer the question why sub-standard services, for instance in construction, are rendered to government, while private clients generally get better services.
• To probe why the good policies government has on procurement cannot be satisfactorily implemented.
• To identify policy gaps that militates against the achievement of government's goals.
• To help business and government to achieve their respective goals.
• To address challenges around guarantees and bridging finance.
A range of recommendations came out of conference, recommendations that if implemented would result in a win-win sitatuion of better service delivery by government, and growth of the black business community in Mpumalanga. The following are some of the recommendations:
• Simplified language on tender documents
• User friendly specifications
• Regular verification of supplier database
• Reduce turnaround time for tenders
• Identify and remove collusion between government officials and service providers in fraud
• Possible fund to address collateral issues
• Funding government institutions to pay assessment visits to applicants instead of outright desktop rejection of funding applications.
These are only some of the recommendations of conference. Since conference did not have sufficient time to assess the implementability of the recommendations, some were invariably found to be in conflict with some policies and legislation. We are however committed to the realisation of the objectives of conference.
Programme Director, colleagues, speaking on behalf of all of us as leaders, we must take our duties serious. We must admit that work done so far to follow-through the deliberations of the Loskop Summit is disappointing to say the least, we could have done better. I make this statement recognising the fact that some of the reasons why we have not made sufficient progress in this regard, are objective, as they relate to matters such as our capacity to do the things we want done. Resources and the availability of people for this work can be a constraint. But the truth is that to every desire in the realm of public duties, there will always be inhibiting factors. We need to be more resolute in our ways.
Through the Task Team, NAFCOC has informed us that in order to achieve the Summit objectives, NAFCOC plans to have a Centre of Excellence at the Provincial level. We are informed that this Centre will serve as the head quarter of all the branches throughout the Province. At this Centre, NAFCOC will access information from international, national and provincial levels. It is our understanding that the Centre will then feed this information to the branches through a network of telecommunications infrastructure and relevant fora such as the NAFCOC Council and the Executive Committee.
Program Director, it is our view that this relationship forged at conference must not simply be a feel good affair but must lead to tangible results for our people, especially the black business community in the province.
Last night we were launching the Mpumalanga Economic Growth Agency. We observed at this launch that there is no contradiction between the goal of economic growth and Black Economic Empowerment. The organisation should actively seek out entrepreneurs in the province who can partner with big enterprises, especially in high growth sectors of our economy. We also highlighted one of the critical areas of intervention to drive economic growth to be the facilitation of BEE in the procurement expenditure of big companies in the province.
NAFCOC has a major role to play in facilitating the flow of information between public development institutions such as MEGA and entrepreneurs.
The entrepreneur we are looking for is not a survivalist who seeks business funding simply because they are unemployed, and funding happens to be available. The entrepreneur we are talking about is not a black face that adds little or no value to the business enterprise in which they partner with white business, except the fact that they know the municipal manager on a first name basis.
We lay no claim to having the ultimate knowledge of what an entrepreneur should look like or possess by way of competencies. As part of our humble contribution to the mission of NAFCOC however, we would like to highlight three key characteristics of entrepreneurship that will make our collective task of black economic empowerment a lot easier.
• First, the capacity to identify opportunities. By the time an entrepreneur bids for a government tender, they must have built their capacity for fulfilling market demand for their goods or services. For a real entrepreneur, government should not be the first port of call to test their capabilities.
Opportunities lie in the gaps in the market in the form of unfulfilled demand. Not all of us have the skill to see such gaps. Even where opportunities are dressed in pink and red, very bright colours indeed, some of us would still not recognise them. Because markets are more ruthless than government, some of our enterprises can only remain in business because they are dealing with government. This syndrome we all cannot be happy about.
• The second critical entrepreneurial competency is the capacity to mobilise financial and physical resources. This is probably where the name enterprise comes from because a person who can creatively access and use minimal resources to maximal effect is generally said to be enterprising. For us who come from a history of lack of access to resources and economic opportunities, this is a critical capability. Those with rich uncles might be able to rely on them to fund their ventures. The rest of us need to develop business plans that demonstrate viability and can attract funding.
Talking about financial resources – let me admit that the provision of sufficient resources to provide the business community in our province with seed capital has always remained a big challenge. It is our intention to improve this situation drastically, through the new-born baby of the province's MEGA. Last night the Board Chairman announced a plan to establish a Growth Fund for which over R1,2 billion has already been mobilised. In this regard, I wish to add that to make this intervention a success NAFCOC must also be enjoined to cultivate with its constituency and members the culture of discipline in honouring their obligations to pay back what they have been loaned. It is also a critical dimension of becoming a successful entrepreneur.
• The last critical competency is the ability to mobilise a team that is relevant to the opportunity and lead such a team. This is a human rather than a technical skill. To some it comes naturally, others have to be taught how to do it. Even the best IT boffin might not be able to mobilise and lead a team relevant to a given opportunity.
Distinguished delegates, honourable guests, I have remarked somewhat extensively about challenges facing our entrepreneurs, not to deride our business community, but out of a desire and duty to generate positive pressure on black business in the province to remind us that it is in our province where the gap between black poverty and white affluence is most acute in the whole country.
I hope that your conference takes you to higher levels of performance and I wish you all the best.
Thank you!