Minister of Public Enterprises Alec Erwin on Tuesday called for bold steps by the private and public sectors to use the current economic realities for continued and increased growth.
Speaking in debate on his Budget vote in the National Council of Provinces, Erwin said the past two or three years have shown the economy is very robust and competitive, and capable of a higher growth rate.
”It is now time for both the public and private sector to internalise this reality and adjust their decision-making accordingly,” he said.
In the public sector, from the local through to the national level, full attention has to be paid to every aspect of infrastructure and efficient and continuous maintenance of that infrastructure.
In the private-sector supplier industries, where investment lead-times were longer, business leaders have to have the confidence and foresight to invest now.
”Hesitancy and timidity are obstacles to the growth that we can achieve. This is not an incitement to reckless planning, but it is a call to courage,” Erwin said.
The public enterprises department and state-owned enterprises (SOE) will attempt to improve their communication with stakeholders so that more information was available for decision-making.
Interaction with potential suppliers into the infrastructure-investment programme is important, both to facilitate such a large programme and to open opportunities for the largest and the smallest of enterprises.
”We will ensure that opportunities arising both from the investment programme and the [non-core] property disposal process are advertised broadly and well in advance to enable broad participation,” Erwin said.
Significant resources are being ploughed into ensuring that SOEs reconfigure to provide world-class, affordable products that meet the demand arising from the growing economy.
The majority of these resources are being directed at core input sectors, such as energy and transport.
Among other things, Eskom has committed R97-billion to improve generation, transmission and distribution of electricity to ensure a secure energy supply.
The electricity build programme includes refurbishing existing power stations, building new generation capacity, and generating alternative, cleaner sources of energy. A number of programmes are already underway.
Efficiency in the port and freight systems is a key ambition, as a delay in this area will form a fundamental impediment to growth.
”A priority of Transnet is thus to accelerate the building of new ports, expanding capacity in the overcrowded ports and modernising freight facilities,” he said.
The capital-expenditure programmes being driven by the SOEs will help grow the local-supplier industry, thereby catalysing the creation of new economic activity and re-establishing related industries.
Transnet and Eskom’s capex spend is estimated to contribute 1,5% of 2004 GDP per annum over the next five years. Spending in key areas of manufacturing will be significant.
The development of the Pebble-bed Modular Reactor (PBMR) will also give rise to a new industrial sector in the form of the supply and maintenance of these reactors.
It is also foreseeable that new engineering techniques to deal with the heat by-product of the PBMR will open many new industrial and chemical opportunities.
Erwin said non-core properties have been classified according to various disposal options, namely sale, housing, transfer and development, and properties for sale have been identified based on their relative location, size, market demand, topography and potential.
Sales, such as with the Victoria and Alfred Waterfront, will be an open and competitive tender process, he said. — Sapa