Industry, to the Global Banking Alliance for Women Summit
6 November 2006
Chairperson,
Ms Claire Logie, Director of Women in Business Bank of Scotland,
Ms Amanda Ellis, Head of Gender Entrepreneurship Markets (GEM),
Distinguished members of the Global Banking Alliance for Women
Secretariat,
Managers and officials of respective banks and companies,
Ladies and gentlemen:
Good afternoon to all of you, indeed it is a great honour to be invited as a
politician to share with this forum the views of my government reflecting how
we have interacted with the private sector, the impact as well as the
challenges. As you have already heard from the other South African presenters,
the issue of women's access to the financial markets has started to dominate
the discussions of our government, moreover, that of the Department of Trade
and Industry (the dti). Addressing this issue to us is critical and will enable
us to fast track women's economic empowerment thus further assisting us to
achieve the national objectives of the Accelerated and Shared Growth Initiative
of South Africa (AsgiSA). Under the leadership of Deputy President, Ms Phumzile
Mlambo-Ngcuka, AsgiSA is our revised economic initiative for growing our
economy targeting to halve poverty and unemployment by 2014.
As already introduced, my name is Elizabeth Thabethe, one of the two Deputy
Ministers of Trade and Industry, responsible for consumer issues as well as the
issues of the second economy. Ensuring that next year in particular South
Africa launches its first fund for women entrepreneurs is one of my priorities
hence my participation in this forum. My Department is committed in making 2007
a year of positive relationship for women with the broader financial markets.
This we will do by also implementing some of the recommendations made in the
study presented to you especially those within our area of responsibility.
Ladies and gentlemen, South Africa is in its 12th year of democracy. Our new
government inherited two economies, this being the first and the second
economy.
Addressing the challenges of the second economy has been part of our main
concern thus an area deserving a special focus. To us as South Africans the
second economy is derived from the specific legacy of the apartheid state which
had the establishment of an economic trajectory. Central to the design of
apartheid economics was an enforced spatial development process that resulted
in a well-capitalised, relatively technologically advanced, urban-based first
economy sector that is increasingly relying on skilled labour and a second
economy that is located in peri-urban and rural areas and is associated with
low skill requirements, poor infrastructure and poor labour conditions.
It is important to note that the marginalisation of the second economy was
systematic, resulting in the relatively under-developed character of these
areas. The majority of those who have been negatively affected by this process
are black people as well as women. Consequently, in the process of redirecting
the economic trajectory of the first economy, it is necessary to develop
interventions that progressively integrate the second economy. It is along
these lines that we at the dti developed the necessary interventions to close
this gap.
Ladies and gentlemen, it is for these reasons that through these 12 years we
have been a country at work restructuring our policies and our way of doing
businesses addressing some of the challenges of our past. Part of this has also
led us to facilitate and forge good partnerships with the private sector in and
outside of South Africa. All of this was aimed at achieving efficient and
affective results as we were transforming our society and our economy as part
of providing a better life for all South Africans, consisting of 44 million
people with its population growing at 1,9 percent. These kinds of partnerships
have been happening in a very structured way under what we refer to as
Public-Private Partnerships (PPPs). As once indicated by our Minister of
Finance, Mr Trevor Manuel, "The public gets better more cost effective
services, the private sector gets new business opportunities. Both in the
interests of the nation."
Ladies and gentlemen, it is indeed based on the positive objectives
associated with PPP's that we have allowed these to advance significantly over
the last seven years under the leadership of the Department of Finance. In 2000
we introduced a treasury regulation for PPPs followed by the 2003 Municipal
Finance Management Act. These have clearly stipulated consistent financial
accountability system for local authorities whilst providing for municipal PPPs
and Treasury a view on feasibility. They have further assisted us to legally
define PPPs as follows:
A contract between government institution and a private party:
* a private party performs an institutional function and or uses State
property in terms of output specifications
* substantial project, be they financial, technical or operational,
transferred to private party
* private party benefits through unitary payments from government budget and
or user fee.
Ladies and gentlemen, as part of implementing our transformation national
objectives we have introduced the black-economic empowerment (BEE) strategy,
the act, now currently facilitated through the first and second phase of BEE
codes of good practice. These are the basic requirements for entering into any
PPPs. The BEE scorecard is applied which stipulates a clear criterion of whom
and how those previously disadvantaged should benefit from these, who happen to
be black men and women. The criteria touch on the equity ownership, management
and employment, subcontracting and the local socio economic impact of the
partnership. So far we have managed to successfully implement more than 50
projects at national level and 300 at municipal level. These have included
infrastructure development (rail, roads and airports), provision of health,
education and social services amongst others.
Ladies and gentlemen, allow me to share with you some of the success stories
we have had. Around infrastructure development those who have had the
opportunity to visit our country would have hopefully seen the dti campus. A
state of art, contemporary and very modern building was a result of this. Its
value to government has been R870 million signed in 2003. Its BEE equity was 55
percent construction, 43 percent subcontract and 50 percent facilities
management. Unfortunately, the involvement of women except at the employment
level was absent, pity for us.
Another one which will be of great interest to you is the construction of
the Chapman's Peak Drive Toll Road, very popular with South Africans and
tourist for any sun shine relaxing day especially Sunday afternoon for locals.
Its benefit to government was R450 million signed in may 2003, 30-year term
with its BEE equity being 30 percent, 10 percent in contracting and
subcontracting and 50 percent in operations and maintenance. Another one is the
Free State Social grants distribution its value being R260 to government signed
in April 2004, three-year term, BEE equity being 40 percent, 30 percent in
subcontracting in its first year, 35 percent in its second year and 45 percent
in its third year.
On a daily basis as part of delivering our services to our entrepreneurs the
dti has also entered into similar initiatives but at a small scale. Through
Khula Enterprise we have been working with the private banks to facilitate the
financing of small to medium size enterprises. Other initiatives have been
through the Gender and Women's Empowerment Unit with institutions like the
banks to train our women entrepreneurs on financial and business management
skills required for ensuring profitable and growing enterprises. Some of these
have also been on initiatives aimed at facilitating access to technology. The
current Women Entrepreneurial Women's Fund being finalised will also be one of
these initiatives.
Ladies and gentlemen, the overall success I can say have included the
following:
Timeous delivery of project, increased number of needs met, some degree of
transfer of skills and knowledge amongst those empowered and those previously
disadvantaged, improved relations between government and private sector,
accompanied by transparency, accountability and good governance of these and
other initiatives not mentioned.
One of the challenges has been to pace of some of these at local municipal
level, unavailability of scarce skills required for fast tracking some of these
projects involvement of women in some of these big projects in strategic
positions. Access to finance and skills development lies in the centre of
mainstreaming women in the main economy. Without these two being addressed,
women will continue to stay in the periphery of our economy.
In conclusion, I would like to thank you again for inviting us to
participate in this forum. As we intend making 2007 a year for women we are
seeking for effective partnerships that will assist us in achieving this
objective. Being a part of alliances like these is therefore critical to us and
we invite all of you interested to come forward and make us your partners in
fighting the exclusion of women in the financial markets.
Issued by: Department of Trade and Industry
6 November 2006
Source: Department of Trade and Industry (http://www.dti.gov.za/)
