B-BBEE still important: ZumaThis year marks 10 years since South Africa introduced Broad-based Black Economic Empowerment (B-BBEE) and it remains an integral part of South Africa's economic policies and transformation, President Jacob Zuma said on Thursday.
"B-BBEE is part of a broader objective of promoting inclusive growth and economic development," he said, adding that the state will continue to intervene and promote transformation.
Mr Zuma was speaking at the first ever B-BBEE Summit, hosted by the Department of Trade and Industry (dti) in collaboration with the Presidential B-BBEE Advisory Council, which he chairs.
He stressed that economic transformation was not just about big business deals for a few individuals in society and that BEE policy should be consistently implemented across all parts of the economy to ensure maximum impact on as many South Africans as possible.
Mr Zuma said that throughout the decade, there have been successes and challenges in the implementation of the legislation, and that the summit was intended to reflect on what has worked and what has not worked, so as to build a truly inclusive economy.
"There have been successes and there have also been challenges," he told delegates, adding, "A lot of progress has been made over the years to open up opportunities and to grow the economy. In this regard, the South African economy has expanded by 83 percent over the past 19 years."
Zuma also noted that there had been growth in the black middle class and said although progress had been achieved with BEE, the country still faced unacceptable levels of poverty, inequality and unemployment.
"Let me hasten to add however, that while we have made strides with regards to black economic empowerment and the growth of the black middle class, we are still faced by unacceptable levels of poverty, inequality and unemployment," he said. "The average annual African household income is R60,613 and of the white household stands at R365,164, indicating the enormous work we must still do to bridge the gap at the levels of the poor and the working class.
"With regards to progress in terms of BEE transactions, according to our National Treasury, over R600 billion in BEE transactions have been recorded since 1995."
Zuma encouraged the growth of SMMEs that are owned by black people, women, youth and people with disabilities.
"We encourage the growth of more SMMEs owned by black people, women, youth and persons with disability in our six New Growth Path job drivers – mining, agriculture, the green economy, tourism, manufacturing and infrastructure development. The backbone of any growing economy will depend on its SMMEs sector, and will have huge impact on creation of jobs and skills development in our economy," he said. "The National Empowerment Fund (NEF), which is mandated to grow black economic participation, has approved over 500 transactions worth over R5 billion to black empowered businesses across the country."
Zuma added that, going forward, active B-BBEE will continue to be an important policy of the ANC government, "driving real and meaningful economic transformation and growth".
"The State will continue to intervene and promote transformation," he explained. "Where the state intervenes strongly and consistently, it can turn around key industries that face external or internal threats as has happened in our manufacturing sector. Intervention by way of targeted financial support and localised State procurement has seen the revitalisation of industries such as train and bus building as well as clothing, textiles and footwear manufacturing. This has helped to protect existing jobs and to create new ones. We are moving a step ahead to promote transformation, and the passing of the BBBEE Amendment Bill by the National Assembly on 20 June 2013 represented a huge step forward. We have reviewed BBBEE in order to align it with other key pieces of legislations, including, but not limited to Industrial Policy, National Development Plan, New Growth Path, and National Skills Development Strategy 3, which are all geared to support job creations, localizations, skills development and growth."
Zuma condemned the act of so-called fronting, calling it unforgivable.
"It distorts our empowerment picture, giving an impression of progress where there is none," he said.
The President continued that business training was "crucial" so that emerging entrepreneurs can gain confidence and expand beyond ownership to become industrialists. He said the State would continue to support empowerment.
"The State will continue to intervene and promote transformation," Zuma explained.
Economic Development Minster Ebrahim Patel and Trade and Industry Minister Dr Rob Davies were among those who attended the first day of the summit.
Image: © Getty
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