GALLAGHER ESTATE, MIDRAND 11 OCTOBER 1999
President (Mr H Khoza)
Chief Executive Office (Mr K Wakeford)
Members of SACOB
Ladies and Gentleman
I thank you for the opportunity to address the SACOB annual convention, the first after our second democratic elections.
This event allows us the opportunity to engage and further strengthen our common understanding of the challenges that face our country on the eve of the third millennium as we move decisively towards a more just and caring society for all our people. This is also the time during which we want to confirm our belief and hope that the next Millennium will indeed be the one where Africa moves from the periphery of the world development to the centre.
Our country has just commemorated the Anglo Boer South Africa War, which started on October 11, 1899. The event this year marks for the first time the role played by black soldiers in this war, and to honour them alongside both the British and the Boer sol diers. An attempt, as others, to have a clearer understanding of how we as South Africans share a common future - socially and economically, but also what this future holds.
Your convention also occurs at a time when inflation is the lowest it has been for many decades. This is testimony to how well this government has been managing the economy.
Our tight management of the economy has helped us weather the Asian crisis, bring down interest rates from over 25% to current levels where new home loans are now 15.5%.
It is true that the economy has shed jobs but this was to be expected as our manufacturing sector was forced to restructure to become more globally competitive. Nevertheless unemployment remains a major problem.
In this context it is important that we critically look at the role and interaction of government and organised business on this path towards a better and more equitable future for all South Africans.
President Mbeki in his address to Parliament on June 25, 1999 said:
"What will guide us in everything we do will be the challenge to build a caring society.This society must guarantee the dignity of every citizen on the basis of a good quality of life for every woman, man and child, without regard to race, or colour or disability.
It must be sustained by a growing economy capable of extending sustainable and equitable benefits to all our people."
He went on to say that this task of building a more caring society is one that can not be carried by government alone. It is a challenge that has to be taken up by the entirety of our people. A national task:
"... that calls for the mobilisation of the whole nation into united people's action, into a partnership with government for progressive change and a better life for all, for a common effort to build a winning nation.The Government therefore commits itself to work in a close partnership with all our people, inspired by the call -Faranani! - to ensure that we draw on the energy and genius of the nation to give birth to something that will surely be new, good and beautif ul."
It is indeed this challenge of building a caring society and the recognition that it can only be done through meaningful partnerships that should be our guiding light in discussing the repositioning of organised business in order to be more relevant.
In this regard the policy positions of government are clear: our long term policy framework to build a better life remains the Reconstruction and Development Programme (RDP) which guided the policy initiatives and developments we saw during the last five y ears. Our economic policy is enunciated in the Growth, Employment and Redistribution Strategy (GEAR) and will remain the cornerstone of managing our economy in the years to come.
After five years of governance the ANC led government is more certain than ever that the partnerships we refer to, need to take into account the realities of government, business, the community and labour. We see the meaningful and institutionalised intera ction of these role players firstly in the processes established through NEDLAC, which amongst other culminated in substantial agreements at the Job Summit towards the end of last year.
In the City Press dated 10th October 1999, NAFCOC voices its dissatisfaction at the structural representation in BSA. On the other hand we are aware of the attempts in the business community to find common ground and agreement on representation in these st ructural relationships, this need to be commended.
The challenges of unity in the organised business sector remain and we look forward to hear from this convention as to the how these processes develop.
Although the matter of unity in the organised business remain a challenge it has to be said that the establishment of the Business Trust has been very positive in working in the areas of human capacity development and job creation.
The process that led to the establishment of Business Trust played an important role in strengthening the political relationship between business and government. The co-ordination and interaction between the government Task Team, the National Business Init iative and the SA Foundation during this process developed a shared understanding and objectives.
Based on this and other experiences the President announced during his address to Parliament on June 25, 1999 that government wants to consolidate these relationships between government and organised business.
In this regard he announced the establishment of Working Groups to strengthen partnerships and achieve common goals. These working groups will bring government together with big business, the black business sector, commercial agriculture and the trade unio ns.
The social partnerships and closer co-operation that is to be forged in these working groups have to jointly identify the areas of perceived or real negative influences on specifically the areas of job creation and the development of the small, medium and micro enterprises (SMME's).
These working groups will not replace the institutionalised relationships established through NEDLAC. The positive experiences in NEDLAC have to be further built on in the years to come. We value structured relationships, as these create intellectual space for the ironing out of differences thereby helping to reduce tensions when these arise.
In talking about the relationships between government and organised business we also need to turn to the realities of today, some which we inherited from the past. Economic power and wealth to a large extent still follow historic patterns. We can not but a gree that this wealth has to be spread more equally.
It is therefore imperative that important elements of our policies should be directed to the deracialisation of the economy to ensure that, amongst other things, in its ownership and management, our economy increasingly reflects the racial and gender compo sition of our society.
If we say that the locality of wealth, and indeed most of the time access to the economy, has to be spread more equally we can not but agree that women and black women specifically needs to be brought into the mainstream.
In order to deracialise the economy, eradicate poverty and reduce the inequality we have to redouble our efforts to:
The achievement of these would result in the elimination of poverty and unemployment and the continuous upliftment of the standard of living and quality of life of all our people. In this regard the private sector obviously has an important role to play. T he important point is that we, and the private sector specifically, must integrate this in our strategies. The deracialisation of ownership of productive property, and the facilitation of the participation of black people in this process, should be an esse ntial part of our perspectives.
Last night in Durban, President Thabo Mbeki opened an Anti-Corruption Conference which is meant to provide a forum where representatives from governments and organisations around the world can exchange their experiences of corruption and forge joint strate gies to fight it.
How do we together with business prevent corruption from taking place? This government inherited the apartheid government, a system that was rotten to the core. How do we transform this through the partnerships we spoke off earlier?
Our efforts to address the scourge of corruption, making strides towards a more representative economy and the empowerment of black people in the economy calls for a shift in our understanding of what constitutes success.
In 1997 at the ANC Conference in Mafikeng Mr Mandela made the observation that:
"... it may very well be that the success of our strategy for black economic empowerment will address not only the objective of the creation of a non-racial South Africa. It might also be relevant to the creation of the system according to whic h the owners of capital would, willingly, understand and accept the idea that business success can no longer be measured solely by reference to profit.According to this thesis, to which we must subscribe, success must also be measured with reference to a system of social accountability for capital which reflects its impact both on human existence and the quality of that existence."
Deputy President Jacob Zuma recently spoke about partnership with business in the fight against the spread of HIV/AIDS. I therefore urge members of SACOB to also actively take part in this partnership. To find ways of breaking the taboos of speaking out an d dealing with a growing number of our work force who are HIV positive.
Today, as the African Renaissance Institute is officially launched at the Presidential Guesthouse in Pretoria, it is also appropriate to reflect briefly on this renaissance. Can we have a renaissance without the active participation of business - no. It is in all our interest that we lay the basis for the process of the Africa Renaissance to take off.
This relates closely to our response to the growing globalisation of the world economy. We can no longer debate if globalisation is a fact or not, we need to discuss our response and how we function within this new reality. Suffice it to say that it is not possible to meet challenges of globalisation without partnership with private sector.
In conclusion then, clearly the single most important challenge confronting us as a nation, whether in terms of deracialising the economy or related to the building and development of our human resource capital, is job creation. In this regard the role of the SMME sector is crucial. In the radical restructuring that larger enterprises have been forced to undergo to become internationally competitive jobs have been lost. However it is a known fact that the SMME sector has the potential to create many more th an these large enterprises. In this regard clearly SACOB, as well as NAFCOC and FABCOS have a crucial role to play. A united approach is required by these organisations. As government we would like to encourage the forging of this unity.
I thank you.