Keynote address by President Cyril Ramaphosa at the 2nd Black Industrialists and Exporters Conference
20 March 2024
Programme Director,
Minister of Trade, Industry and Competition, Mr Ebrahim Patel,
Minister, Deputy Ministers and MECs,
Leaders from the Black Business Council and Business Unity South Africa,
CEOs of state-owned companies,
Commissioners from the Competition Commission and the BEE Commission,
Industrialists, entrepreneurs and business leaders,
Distinguished Guests,
Ladies and Gentlemen,
I am delighted to join you at this showcase of black industrial excellence, the Second Black Industrialists and Exporters Conference.
This Conference coincides with the 20th anniversary of the enactment of the Broad-based Black Economic Empowerment Act.
This Conference also takes place as we approach the 30th anniversary of our democracy.
It is therefore a good moment to reflect on our empowerment journey, which is a central part of the changes that have taken place in our country over the last three decades.
We have about 1,000 black industrialists present here today. This is a living testimony to the changes that have taken place in the past 30 years, and indeed, over the past five years.
Empowerment is a historical imperative, to provide redress to black South Africans, who were discriminated against and excluded under apartheid.
Even after the advent of democracy, and the removal of discriminatory laws, the racial features of privilege and disadvantage remained.
Unlike many of their white compatriots, most black people did not have access to the capital accumulated in families or the networks acquired at school and university, on the golf course or in social circles.
The inequality went deeper. Underdevelopment in townships and bantustans limited access to economic opportunities. Bantu Education left several generations without the skills needed to improve their economic situation.
Much has changed in our country, but this iniquitous inheritance continues to diminish the economic prospects of many black and women South Africans.
It is this inheritance that we are determined to overcome.
In this, we are guided by the Bill of Rights contained in our Constitution, which says:
“Equality includes the full and equal enjoyment of all rights and freedoms. To promote the achievement of equality, legislative and other measures designed to protect or advance persons, or categories of persons, disadvantaged by unfair discrimination may be taken.”
Let us take a moment to reflect on the historical journey of black industrialists in South Africa.
For far too long, our country's economic landscape was marked by inequality, exclusion and systemic barriers that hindered the progress of aspiring entrepreneurs, especially those from black communities.
However, despite facing immense challenges, black industrialists have persevered, defying odds and breaking barriers to create thriving businesses and contribute significantly to our nation's economic development.
Today, we celebrate the power of empowerment. Empowerment that has not been handed out as charity but earned through hard work, resilience and unwavering determination.
Black industrialists are not just job creators and wealth generators; they are agents of change, driving social and economic transformation in our communities.
At the heart of every successful industrialist lies a spirit of innovation and creativity.
Whether it is in technology, manufacturing, agriculture or services, they have shown that excellence knows no bounds and that Africa is a continent brimming with untapped potential and ingenuity.
None of this progress would have been possible without the spirit of collaboration and partnership.
Government, private sector stakeholders and civil society have come together to create an enabling environment for black industrialists to thrive.
By working hand in hand, we have been able to dismantle barriers, foster mentorship, and provide access to markets, funding and resources essential for business growth and sustainability.
The journey of black industrialists is part of the broader journey of social and economic transformation in our country.
This is evident in the fact that South Africans are living longer than ever before.
Life expectancy has increased from 54 years in 2003 to 65 years in 2023. Maternal and infant deaths have declined dramatically.
Households that resided in formal dwellings increased sharply from 65 percent in 1996 to more than 88 percent in 2022.
Access to electricity for lighting has increased from 58 percent of households in 1996 to nearly 95 percent in 2022.
At the end of apartheid, only six out of 10 people had access to clean drinking water. Today, that figure has increased to nearly nine out of 10 South Africans.
The percentage of persons aged 20 years and older who completed secondary education more than doubled from 16 percent in 1996 to more than 37 percent in 2022.
Our economy has tripled in size since 1994, and while unemployment still remains high, the number of South Africans in employment increased from eight million in 1994 to over 16.7 million now.
The proportion of jobs in executive management held by black people increased almost five-fold between 1996 and 2016.
All of this progress points to the work we have undertaken as a society to give effect to the constitutional injunction to promote the achievement of equality.
It is this injunction that led to the enactment of the Broad-Based Black economic Empowerment Act 20 years ago.
And to give effect to the core goals of that legislation, government formally launched the black industrialist programme in 2016.
This programme is part of the broader effort to expand South Africa’s industrial base, especially in new and growth industries.
While affirmative action in the economy aims to redress the damage of the past, it is also sound economics.
It broadens the base of entrepreneurship, it opens the economy to more talents and capabilities, it encourages innovation and expands the economy.
This Conference showcases the results of this investment.
It shows the impact of the black industrialists programme, not only in the wares on display, but also in the data that will be presented here.
The impact of this investment is clear from more than R100 billion in turnover generated by these businesses each year and by more than 100,000 direct jobs sustained in their factories, mines and farms.
This Conference tells the stories of the industrialists of freedom, who built their businesses through hard work and ingenuity, propelled along by the tailwinds of democracy and opportunity.
Over the course of the last five years, we have worked to deepen these efforts.
At the start of this administration in 2019, we began to develop master plans in different sectors of the economy, ranging from clothing to sugar, from autos and steel to poultry.
These masterplans have specific and dedicated sections dealing with the promotion of black industrialists.
In the auto sector, clear targets have been set for the promotion of black industrialists as component manufacturers. In the clothing industry, government set up a fund to support SMMEs.
In the sugar industry, an industrial fund of R1 billion over 5 years has been put in place, and small-scale black farmers receive about R200 million in support annually.
We also ramped up the black industrialist programme’s funding. In the past five years, some R24 billion has been committed for black industrialists.
Through institutions like the Industrial Development Corporation and the National Empowerment Fund, we have provided funding to several black-owned companies in emerging high-tech industries, from pharmaceuticals to renewable energy to chemical production.
Alongside the provision of funding and other forms of support to black- and women-owned companies, we have taken steps to improve the operating environment for these businesses.
We introduced new legislation that increased the powers of the competition authorities to act against abuse of dominance or commercial practices by large firms that keep small businesses and black South Africans out of markets.
Among other things, this has resulted in the reduction of data costs and an agreement to end long exclusive leases that big supermarkets had in place with shopping malls.
It ended the practice where insurance companies kept smaller township-based or black-owned panel-beaters off their insurance-approved lists.
It prohibited practices that kept small township delivery services from being able to contract with franchisees of large fast-food companies.
Through measures taken during mergers and other investigations by the competition commission, several large companies have made around R2.4 billion in funding available for supplier development. These include companies like Coca-Cola, Pepsico, Heineken, Shoprite-Checkers, Astron and Massmart.
Google has made R330 million available for young app developers in South Africa.
In the Equity Equivalent Investment Programme, over the past five years large car-makers and companies such as Amazon, JP Morgan and Citibank have committed support for black industrialists to a total value of R7.2 billion.
In January this year, we began the implementation of the African Continental Free Trade Area, which brings together a vast market on the continent.
The African Continental Free Trade Area is an opportunity for black industrialists to enter markets across the continent, to partner with firms in Ghana, Kenya, Algeria, Angola and 40 more countries to penetrate those markets.
The Black Exporters Network that we launched at the previous conference enables black industrialists to share experiences and provide support to each other as they move into other markets.
In addition to the huge opportunities on the African continent, there are businesses here today that are successfully exporting to the United States, the European Union the United Kingdom, China, India and the Middle East.
These businesses are being supported by government’s robust efforts to expand access for South African products into significant export markets.
What all these examples show is the scope and extent of support that is now being given and how we are energising the black industrialist and export programmes.
In spite of the electricity and freight logistics challenges, we are making progress.
Through an intense focus on implementing the Energy Action Plan, there has been a steady decline in the severity of load shedding over the last half year.
Through regulatory changes and other measures, we are seeing massive new investment in energy generation and in the installation of rooftop solar.
Government, Transnet, industry and other social partners are working closely to relieve congestion at our ports and increase the volumes of freight being carried on our key rail corridors.
The R1.3 billion Energy Resilience Fund put in place to support SMMEs and other firms affected by the energy challenges is fully subscribed.
When the Black Industrialist Programme was initiated in 2016, it set a target of 100 black industrialists.
During this administration, we have taken it well beyond 1,000 black industrialists that are supported through the range of government activities.
In addition to what we have done through partnerships and the work within the trade, industry and competition portfolio, there are several other measures that we have undertaken to promote economic inclusion.
Through state procurement, many additional billions of rands of support has been provided to black-owned businesses to supply the state.
The Department of Agriculture, Land Reform and Rural Development, together with entities such as the Land Bank, provide further support to black farmers.
Then there is the support given through the Department of Tourism to emerging tourism businesses, and the infrastructure spending by state-owned companies who use black suppliers to manufacture key inputs and provide key services.
The Department of Small Business Development has supported large numbers of micro and small businesses, adding to the numbers we can celebrate.
The black industrialist programme itself has also gone a long way in promoting meaningful participation in the economy by women, youth and persons with disabilities.
Looking forward, we need to set ambitious targets for the next five years.
First, we need to scale up the number of black industrialists that are supported directly by government through various forms of support, including finance, regulatory measures and partnership arrangements through masterplans.
These businesses will be drawn from manufacturing, green technologies, the digital economy, mining, agriculture, construction and tourism.
Second, we need to scale up the level of financial support we make available through the public sector and partner funding.
A particular focus will also be on support for small businesses and those owned by women and youth.
Third, we need to open up the economy and make it more inclusive. This means addressing features of the market structure that inhibit the participation of black industrialists in the economy.
To facilitate this, we will be setting a target that the Competition Commission should undertake a set number of market inquiries in strategic sectors in the coming five years, aimed at addressing high levels of economic concentration and low participation by small businesses.
Fourth, we need to export more of our processed products, including through the African Continental Free Trade Area.
This can be done through partnerships with existing exporters, financing of exhibitions, assistance with credit risk and other means.
To facilitate this, we will set a target of the number of black industrialists be supported and assisted through the Black Exporters Network to get into export markets over the next five years.
These targets will guide the work of economic regulators, development finance institutions and government departments across the three spheres, with fiscal support focused on achieving these targets.
We will also work to unlock funds within the private sector, through supplier development funds, local procurement commitments and public interest conditions that are made when licenses are issued or regulatory approvals are obtained.
The whole economy benefits from the growth of black-owned businesses.
Through partnerships with established businesses, we can leverage more procurement, technical support and financial backing to black industrial suppliers.
Joint-ventures can help to expand the footprint of small and large businesses in global markets.
I want to thank the CEOs of various established enterprises that have committed to procure services from black industrialists.
During this conference, a number of firms will make further pledges that cover the next five years, in an event that we hope to repeat again at the next Conference, pledging billions of rands of procurement.
This will go a long way in fostering economic inclusion and transformation of our economy.
This conference is not only an opportunity to showcase, celebrate and acknowledge the strides that black businesses continue to make within the South African economic landscape. It is also an opportunity for the businesses to network and explore opportunities for collaboration.
As I close, I invite you to join us tonight at the Awards Evening and Gala Dinner where we will celebrate black industrial excellence.
Through all these efforts, through the many successful businesses that we are here to celebrate, we are together transforming our economy and changing lives.
I thank you.
Issued by The Presidency, 20 March 2024
