State to intensify SOE re-purposing for growth, development

Thursday, February 13, 2020

Government will this year intensify efforts to stabilise and re-purpose the country’s state-owned enterprises to support growth and development, President Cyril Ramaphosa has announced.

Delivering the 2020 State of the Nation Address on Thursday, the President said government is working to ensure that all SOEs are able to fulfil their developmental mandate and be financially sustainable after years of state capture, corruption and mismanagement.

“In consultation with the Presidential SOE Council, we will undertake a process of rationalisation of our state owned enterprises and ensure that they serve strategic economic or developmental purposes.”

He said the extent of capture, corruption and mismanagement in SOEs is best demonstrated at South Africans Airways (SAA), which was placed under business rescue late last year.

The business rescue practitioners are expected to unveil plans for the restructuring of SAA in the next few weeks.

“In the interests of South Africa’s aviation industry and our economy, it is essential that a future restructured airline is commercially and operationally sustainable and is not dependent on further government funding,” said the President.

A key priority this year, he said, is to fix commuter rail which is vital to the economy and to the quality of life of the people.

“Our rail network daily transports over a million commuters to and from work,” said President Ramaphosa. “We are modernising PRASA’s rail network.”

The Central Line in the Western Cape and the Mabopane Line in Pretoria have been closed for essential refurbishment and upgrades.

Government, he said, will over the next years invest R1.4 billion in each of these lines to provide a safe, reliable and affordable service.

“Work underway on other lines includes station upgrades, parkway replacements, new signalling systems and overhead electrical traction upgrades,” said the President.

Furthermore, the President announced that government will over the next year undertake a fundamental overhaul of the Durban port – the third largest container terminal in the Southern Hemisphere – to reduce delays and costs.

“Our ports are congested and inefficient,” he said. –