Speaking at the launch of the DBSA’s annual report in Soweto yesterday, Manuel urged the bank to focus more on development financing and thus to strengthen the ability of government to achieve more.
“The DBSA cannot wait for the debate on development finance to be concluded globally. We must ask of it to offer leadership by example to the debate elsewhere.
“This will mean that its work must focus more emphatically on development, and a rebalancing of the roles of financier, adviser and partner,” he stated, adding that the DBSA’s future work should be informed by more rigorous targeting.
Manuel pointed out that he would like the targets to include:
– A focus on the poorest quintile – looking beyond the macro-aggregates and into qualitative improvement in the lives of the poorest.
– New partnerships with the poorest municipalities in support of the challenge placed by Mbeki’s to ensure that municipalities with low fiscal capacity are adequately resourced and empowered to collect their own revenues.
– Significant interventions to reverse the current geography of poverty – transforming RDP housing areas into sustainable communities and unleashing the potential for local economic development.
– Additional support for infrastructural development across all municipalities, including a determined effort to upgrade older townships.
– A much larger push in support of urban renewal projects and the ISRDP.
“Delivering on the people’s contract requires all hands on deck. It also demands the unique ability to congratulate ourselves for past performance, while committing to do much more in the future,” he concluded.
DBSA chairperson Jay Naidoo echoed Manuel’s call for the bank to focus more on development activism and vowed that the DBSA would continue to support labour-intensive projects, which have been proven to “absorb five times the amount of jobs” as non-labour-intensive projects.
He explained that during ‘Vision 2014’ – the DBSA’s next ten-year plan – the bank would redouble its efforts to create an empowered and integrated region free of poverty, inequity and dependency, while seeking to retain its business model and credit rating.
“We will seek to drive down the cost of money for these projects,” Naidoo added.
In terms of Manuel’s call for more financial risk-taking by the DBSA, the bank’s CEO and MD, Mandla Gantsho, pointed out that risk management was one of the DBSA’s core competences.
“We have to do things in a business-like way and push back the frontiers of poverty. We will take financial risks and sell them back to the private sector,” he commented.
Gantsho also said that the DBSA would continue to strive to be a leading change agent for sustainable socioeconomic development in Southern Africa and to be a strategic development partner to the wider Africa region, primarily south of the Sahara.
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