Opportunity magazine is a niche business-to-business publication that explores various investment opportunities within Southern Africa’s economic sectors and looks to provide its readers with first-hand knowledge about South African business.
Opportunity also looks to present South African business to international markets that may have interests in investing in South Africa. The publication is endorsed by the South African Chamber of Commerce and Industry (SACCI).
www.opportunityonline.co.za JULY/AUG/SEPT 2021 • ISSUE 98
ESTATE PROPERTIES
Ten of the best
What AfCFTA means for
transport and logistics
JOIN US ONLINE
SMME Virtual Roadshow
INFRASTRUCTURE
INVESTMENT
Public and private players
are aligned to make it count
AGILE AND
RESPONSIVE LOCAL
GOVERNMENT
Opportunity interviews Midvaal
Executive Mayor Bongani Baloyi
AUTOMOTIVE
Toyota’s newest
passenger model
is to be built
in Durban
The Toyota Corolla Cross to be built at the Prospecton Plant in Durban will
generate around R 2.85-billion a year in local component purchases.
Toyota South Africa Motors (TSAM) announced earlier this
year that it would be manufacturing and selling the brandnew
Corolla Cross... The model reveal, made by TSAM
President and CEO Andrew Kirby at the annual State of
the Motor Industry (SOMI) address in January, follows the
company’s announcement in 2019 that it was investing R2.43-billion in
the production of a new passenger
vehicle in South Africa.
“As announced at the Presidential
Investment Summit in November
2019, Toyota pledged to invest
R2.43-billion in the production of a
new passenger model, and I am so
pleased to say that we are making
good on that promise. We will be
manufacturing this very model
[Corolla Cross] in both right- and left-hand drive… on schedule… for South
Africa and the rest of Africa… right here at Prospecton! The Corolla Cross
is based on the acclaimed new Corolla TNGA platform and will be built on
our passenger car production line alongside the Corolla Quest,” says Kirby.
_________________
Corolla Cross aims to build on the
legacy of Hilux Toughness and will be
exported to 43 countries in Africa.
________________
TSAM’s Executive Vice President of Manufacturing and
Manufacturing Support Group, Nigel Ward, adds that the
manufacturing of the new model will also include the development of
three new Tier 1 and a number of Tier 2 suppliers, which is a significant
step towards the transformation of the automotive value chain.
A significant milestone
In addition to the investment, the
local production of the Corolla Cross
also ushers in a couple of “firsts” for
TSAM’s manufacturing team at the
Prospecton Plant. “This is a significant
milestone for Toyota South Africa. It’s
not often that we get to produce a
brand-new body shape in our factory;
plus, it is the very first time that we will
be manufacturing a Hybrid model which I believe will fast become
a very popular choice. And it’s the first time for us to manufacture
using the Toyota New Global Architecture (TNGA) – which allows us
to keep up with global technology and trends,” says Ward.
AUTOMOTIVE
From a skills and manufacturing
point of view, TSAM believes
that – besides being a crisis of
unparalleled proportions – Covid-19
has inadvertently encouraged
plant production teams to be more
self-reliant. According to Ward,
“Restriction on international travel
_________________
Covid-19 has
inadvertently
encouraged plant
production teams to
be more self-reliant.
________________
due to Covid-19 necessitated that
we rely on local expertise on many
elements of the project instead of
flying in engineers from Japan and
Thailand. To ensure that we are on
schedule to commence production
in October, we have had to do a lot
of things ourselves, in addition to
receiving support virtually from
Japan and Thailand on some
occasions.
In terms of strategy, Corolla Cross aims to build on the legacy
of Hilux Toughness and will be exported to 43 countries in
Africa. The new model is also expected to push Toyota export
volumes to about 15-20% per annum. Toyota is projecting
growth of 7% per annum in the SUV market in Africa – offering
significant growth opportunities to expand production of this
new model. With the Prospecton-built Hilux already dubbed
“built for Africa” in some parts of the continent, the Corolla Cross
has been strategically positioned to expand the local SUV line-up
of Fortuner and C-HR.
According to Kirby, "This is an ideal vehicle for our market. It provides
an exceptional balance between drivability, roominess, comfort
and high-tech features – truly a game-changing SUV. It combines
everything you love about Corolla with the utilitarian and rugged
aesthetics of a segment-leading SUV. Overall, the expectation is that
the Corolla Cross will not only contribute significant sales towards
the Toyota brand, but also accelerate the growth of the mini-SUV
segment, increase the overall size of the passenger market in South
Africa and give momentum to electrification technologies.”
The project will generate more than 500 jobs at Toyota.
Toyota has invested R2.43-billion in the Corolla Cross project.
www.opportunityonline.co.za | 1
Contents
ISSUE 98 | JULY / AUG / SEPT 2021
06
08
10
16
18
24
30
38
46
SACCI FOREWORD
Banishing corruption and building a competent state
NEWS & SNIPPETS
What has been and what is to come
ABILITY, AGILITY AND SUSTAINABILITY: WHAT MODERN GOVERNMENT CAN LOOK LIKE
The Executive Mayor of Midvaal Local Municipality, Alderman Bongani Baloyi, is proud of seven
consecutive clean audits and believes that stability and good systems are vital in attracting investors
GUIDING THE TRANSITION
A recent special meeting of the South African Local Government Association (SALGA)
focussed on renewal in the runup to elections
THE KEY TO A SUCCESSFUL ECONOMY IS A BETTER BALANCE OF SMES
As financier Business Partners Limited marks its 40th anniversary milestone, Managing Director
Ben Bierman reflects on how the local SME sector has still not reached its full potential
ACHIEVING ECONOMIC RECOVERY THROUGH A BRICKS-AND-MORTAR PATH
Researcher and writer Sello Mabotja investigates how infrastructure investment is set to play a leading role
in reversing the effects of the Covid-19 pandemic and weathering the simmering economic maelstrom
SOUTH AFRICA’S PETROLEUM BILL: WILL IT RETAIN AND ATTRACT INVESTORS?
Nonkululeko Zondo and Callie-Jo Bouman of Bowmans run the rule over the latest draft of the
Upstream Petroleum Resources Development Bill which has come before parliament
POLICY NEEDS TO MATCH INFRASTRUCTURE FOR AFRICA’S TRADE TO THRIVE
Hubs around ports and links to transport corridors will enable the newly-minted African
Continental Free Trade Area to thrive, as a recent report by Dianna Games shows
INVESTMENTS IN ESTATE PROPERTIES ARE PROVING THEIR WORTH
A new review by New World Wealth selects 10 of the best lifestyle estates in the world, with
three South African estates listed
www.opportunityonline.co.za
Quarterly journal for business and industry in South Africa
JULY/AUG/SEPT 2021 • ISSUE 98
10
30
46 38
ESTATE PROPERTIES
Ten of the best
What AfCFTA means for
transport and logistics
JOIN US ONLINE
SMME Virtual Roadshow
INFRASTRUCTURE
INVESTMENT
Public and private players
are aligned to make it count
AGILE AND
RESPONSIVE LOCAL
GOVERNMENT
Opportunity interviews Midvaal
Executive Mayor Bongani Baloyi
ABOUT THE COVER:
Three significant assets in the Midvaal Local Municipality are shown on the
cover: the wall of the Vaal Dam (Credit: Vaal Explorer); the Heineken brewery
(Credit: Heineken); Bass Lake (Credit: Burnesseo Internet Marketing Service: www.
burnesseo.co.za)
ADVISORY SERVICES
Mint Fresh
Advisory Services
Founder Thuli Magubane reflects on the popularity of innovation
workshops for entrepreneurs and small businesses.
When Thuli Magubane bought a shelf company in 2010, she liked the “Mint
Fresh” part of the name and so that’s what this 100% black women-owned
and managed boutique management consulting firm became, and it’s a
name that’s become a trusted brand over the last 11 years.
Mint Fresh Advisory Services arose out of Thuli’s desire to expand her
horizons, something she’s been doing ever since she switched from studying politics to
commerce. “I knew I was going to go into business from that time,” says Thuli.
Her first business was in BEE consulting but because she didn’t want to get boxed in,
she had a five-year stint in banking with Absa and Investec before launching Mint Fresh.
The company offers a wide range of services from strategic and business planning, project
management and market and customer strategies to financial advisory services.
When the company evolved over the years, Thuli found that she had come full circle. “I
found myself back in the BEE space with the focus on enterprise and supplier development.”
In the early days, getting clients’ trust was tough. "'Who is this Mint Fresh?' It takes time to
build trust and a rapport.” As the company built up a portfolio of work, Thuli found she could
use successful projects as a reference point. “The more you do, the easier it becomes,” she says
of those early days. A successful programme with Sasol showed what can be achieved. Young
people were selected for an Entrepreneurship programme programme which was run by Mint
Fresh while Sasol donated equipment and made facilities available at an incubator at Sasolburg.
Thuli Magubane
Biography
Recognised in 2018 by the Entrepreneur
Magazine as one of the top 50 businesswomen
to watch in South Africa, Thuli was also selected
by Money Today SA as one of the country’s Top
12 businesswomen in 2019. Thuli is a graduate
of UCT, having majored in Political Science, and
holds a Postgraduate Diploma in Management
(PDM) from the Wits Business School. She
completed a Master’s programme in Leadership
and Strategy at Instituto de Empresa (IE) Business
School in Madrid, Spain.
Services
Sometimes corporates ask the company to find a small business as a supplier, but Mint Fresh is also
asked to assist or train SMMEs that the larger company has already identified. In the case of a taxi
association in the Northern Cape, Mint Fresh helped the group register as a company (as a prerequisite
for trading with the mining company) and advised it on systems and compliance issues.
Clients include Nedbank, Standard Bank, Tata, South32, Sasol, the National Empowerment Fund
(NEF) and Transnet.
The fastest-growing aspect of Mint Fresh’s business is the series of workshops that it runs on
innovation. “We focus on getting small businesses to think more about innovation and helping
those with an idea but who don’t know how to implement it,” says Thuli.
These sessions are generally sponsored by government or corporates, who contract Mint Fresh
to offer the service, which is about to be rolled out in rural areas. There are practical benefits. As
Thuli asserts, “At the end of the workshop, participants walk away with a concrete action plan.”
Thuli credits mentors who have helped her as an individual and supported her in her career
path. Now mentorship is built into programmes that Mint Fresh offers to entrepreneurs. “We work
with people who are currently running their own business and are willing to make the time to
mentor,” she says.
Having mentors spread around the country is an advantage because participants on Mint Fresh
programmes can then “engage with someone who can direct them and they can introduce them
to a network”.
Mint Fresh Advisory Services
Office: 63 Braam Fischer Drive, Ferndale, Randburg | Tel: +27 (011) 086 0629
Email: info@mintfreshas.co.za | Website: www.mintfreshas.co.za
EDITOR’S NOTE
Midvaal
shows the
Delivery and accountability are buzzwords that take on extra weight in
the time of elections. With local elections due to take place across South
Africa in 2021, Covid-19 permitting, citizens are increasingly becoming
aware of how directly their lives are affected by the performance of
local government.
The decision by Clover to close its cheese-making factory in the North West town
of Lichtenburg was a depressing but predictable reminder that the quality of local
government is vital to business. Although the town is the administrative centre of
the Ditsobotla Local Municipality, services had deteriorated to such an extent that
the company felt it had no choice but to move operations to KwaZulu-Natal. The
resulting job losses will be felt hard in the small town.
Astral Foods recently won a court order to force the national government and
Treasury to come up with a financial recovery plan for the Lekwa Local Municipality.
The company’s poultry factory in Standerton has been badly affected by electricity
outages and water shortages.
In this context, it is heartening to read about the successes of the Midvaal Local
Municipality, not only in attracting and working creatively with a major investor such as
Heineken, but in consistently delivering services to its citizens and racking up a shining
record in achieving clean audits.
To read of Midvaal’s achievements is to be reminded that there are many public
officials in South Africa who take pride in their work and who understand that they
have a responsibility to provide for the common good.
Infrastructure programmes have been touted as a possible economic saviour
ever since the 2010 World Cup was held in South Africa. Could current plans actually
start to bear fruit? Sello Mabotja interrogates this issue from page 24. Elsewhere in
this magazine, the implications of parliament’s approval of the Upstream Petroleum
Resources Development Bill are outlined (page 30) and an extract from a recent report
by Africa-expert Dianna Games (page 38) looks at what the newly-minted African
Continental Free Trade Area agreement (AfCFTA) will mean for the transport and
logistics sectors.
Africa and South Africa are seldom short of plans. The Mayor of Midvaal and his
council have shown that plans can be turned into reality, and that’s good to know.
John Young, Editor
4 | www.opportunityonline.co.za
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would like to express thanks to those who support this publication by their
submission of articles and with their advertising. All rights reserved.
Welcome to South Africa’s
fabled diamond fields
Frances Baard District Municipality is nestled in the north-eastern corner of the Northern Cape Province,
and contains four local municipalities, namely Sol Plaatje, Dikgatlong, Magareng and Phokwane Municipality.
In 1870 diamond diggers proclaimed it the Republic of Klipdrift.
Other towns in the area include Delportshoop, Longlands, Kutlwano,
Sydney on Vaal, Ulco and Windsorton. Dikgatlong is the site of the
first alluvial diamond digging in the region and is renowned for its
excellent fly-fishing spots and luxury game lodges. The adventurous
are encouraged to go in search of the Gong-Gong waterfall on the
Vaal where the quiet river suddenly tumbles into a gully and fills
out into a tranquil pool.
PROFILE
SOL PLAATJE MUNICIPALITY
This municipality is named after the first secretary-general of the
African National Congress and writer, Solomon “Sol” Plaatje. At
the heart of Sol Plaatje Municipality is the bright metropolis of
Kimberley, the capital city of the Northern Cape. The municipality
also includes the towns of Modder River, Ritchie, Riverton,
Beaconsfield, Kenilworth, Ronald’s Vlei and Spytfontein.
Kimberley is a diverse city with a vibrant, colourful history. The
city is renowned for its Big Hole and Mine Museum, the largest
excavated hole on earth, and important archaeological discoveries;
Kamfers Dam, a wetland that supports the largest permanent
population of lesser flamingos; Wildebeest Kuil Rock Art Centre, a
premier rock art centre with over 400 San rock engravings; and
the sprawling and vibrant Galeshewe Township, the first and oldest
township in South Africa.
MAGARENG MUNICIPALITY
The name Magareng is a Setswana word meaning “The Middle” and
is derived from the fact that this region is literally in the middle of
the country. Warrenton is an agricultural town located 70km north
of Kimberley on the Vaal River and is the administrative centre of
the municipality.
Diamonds were first discovered in Warrenton in 1888. The town
was originally known as Stanger’s Rest, then Fourteen Streams, but
was finally named Warrenton after Charles Warren in 1880.
PHOKWANE MUNICIPALITY
Phokwane embraces Hartswater, Pampierstad and Jan Kempdorp,
originally named Andalusia. Hartswater is home to Olives South
Africa and boasts a variety of nuts and local wines from Hartswater
Wine Cellar. The town offers accommodation, leisure activities and
historical attractions such as the burial site of Chief Galeshewe and
the Women’s Memorial building. The town of Jan Kempdorp hosts
two World War II concentration camps and lies in the heart of the
Vaalharts Valley and irrigation area.
DIKGATLONG MUNICIPALITY
Dikgatlong is a Setswana name meaning “confluence”, referring to
the place where the Harts and Vaal Rivers flow into one another.
The hub of Dikgatlong Local Municipality, Barkly West, was founded
as a mission village in an area known as Pniel, “Face of God”.
____ ___ _
FRANCES BAARD DISTRICT MUNICIPALITY
Tel: +27 (0) 53 838 0911 | www.visitdiamondfields.co.za
FOREWORD
Banishing corruption
and building a
competent state
The virtues of meritocratic government are obvious.
Credit: Sasol
More so, now than ever, South Africa needs
competent bureaucrats running the state, from
the municipalities right through to the top tiers
of national government. Citizens are crying out
for a competent state.
Mint Fresh Advisory Services arose out of Thuli’s desire to expand
her horizons, something she’s been doing ever since she switched
from studying politics to commerce. “I knew I was going to go into
business from that time,” says Thuli.
Reeling this back to the national lockdown in March 2020,
the country has witnessed tender corruption in the Covid-19
procurement process.
SACCI has publicly advocated for the principle of a competent
state and officials being appointed because they can do the job.
The country cannot continue to operate in a situation where jobs
for pals, nepotism and cadre deployment practices continue to
prevail to the detriment of the country, its taxpayer base and its
international image. The image is of a corrupt system which has
attracted an international status of a country with junk-bond
status, not investment grade status.
During 2020, various pronouncements were made by SACCI
calling for current practices to be reviewed.
In December 2020 government listened to SACCI and
published a government gazette which espoused the virtues of
a meritocratic government.
In recent weeks we have seen the President and even cabinet
ministers talking to this subject. The Minister of Police has supported
the principle of competency within the force.
The first hurdle was always going to be bringing about a mind-set
change from the top down and this is now starting to materialise.
But this is not something that is going to happen overnight. It’s a
_________________
The years of patent corruption in
government appear to be gradually
coming to an end as the legal system is
slowly catching up with the culprits.
________________
process which requires a gradual phasing out of people who are
offered generous packages to step down, and for new best-ofbreed
bureaucrats to be appointed.
The argument that this is going to cost the taxpayers
significantly needs to be brought into perspective. Government
and state-owned enterprises currently deploy hundreds
of billions of rand annually to consulting houses to buy the
expertise to manage their
projects. Having this expertise
in-house will cost a fraction of
this amount annually. Clearly, this
does not require political savvy –
it just makes business sense.
The years of patent corruption in
government appear to be gradually
coming to an end as the legal
system is slowly catching up with
the culprits.
Generally, we believe this augers
well for South Africa, the economy
and a bureaucracy we can all be
proud of going into the future. Alan Mukoki, SACCI CEO
Credit: Hannelie Coetzee/Brand SA
SMME VIRTUAL
ROADSHOW
PRACTICAL AND USEFUL
INFORMATION ON SMALL,
MEDIUM AND MICRO-BUSINESS
IN SOUTH AFRICA.
TO REGISTER:
Visit www.gan.co.za
and then SMME Virtual
Roadshow
Since 2014, the SMME Roadshow has supported small
business in South Africa. Following the unprecedented
challenges of 2020, Global Africa Network is relaunching
the SMME Roadshow in a fully virtual, nationwide format.
The SMME Virtual Roadshow, brought to you by Global
Africa Network Media with Nemesis Accounting, SME
Warrior and Aurum Wealth Creators, takes the form of
presentations and practical guidance from thought
leaders and experts in their fields.
Presentations are pre-recorded for quality and convenience
and presenters and their teams will be on hand to engage
and interact with delegates. Delegates will also be able to
network with other delegates.
Who should attend?
SMMEs requiring support and guidance on the following
topics should attend:
ABOUT GLOBAL AFRICA NETWORK
Global Africa Network Media (GAN) is an established
authority on business development in South
Africa’s nine provinces. GAN’s online products
include its well-established B2B portal, www.
globalafricanetwork.com, and its monthly business
and investment e-newsletters, with a reach of over
53 000 subscribers.
Each of the nine titles and the national journal,
South African Business, has been utilised by all
levels of government, parastatals, corporates,
and national and provincial businesses. GAN is a
specialist in small and developing business, and the
company is a trusted partner of business chambers
and other representatives of organised business in
each province.
• Access to funding
• Access to markets
• Business revival
• Training and skills development
• Compliance and regulatory
• Technology support
• Running a business
Each of South Africa’s nine provinces will be represented at
the Roadshow, and will showcase incentives, services and
opportunities available to SMMEs.
For information on sponsorship opportunities, email
info@gan.co.za
News & snippets
Industry insights from
the past quarter
Mamonkwe Trading is seizing the moment
Mamonkwe Trading, a 100% black-owned company with a permanent staff complement of more than 150, is growing
its footprint in a range of fields.
Mamonkwe Trading is the mother body for a number of subsidiary companies trading under the same banner with the
main focus being plant hire, mining rehabilitation, coal transportation and logistics.
The business philosophy of founder and CEO, Robby Mogashoa, can be summed up as, “An opportunity presents itself for
a moment to be seized by a prepared person.” The company was founded 14 years ago by this dynamic son of Limpopo’s soil.
Says Robby, “We offer the right solution at a compatible rate. We distribute and deliver only high-quality products and
services through reliable and efficient solution systems.” Clients of Mamonkwe Trading include Pan African Resources, Evander
Gold Mine, Manana Chemicals, Eskom and Universal Coal.
Robby Mogashoa has been going
beyond expectations since moving
from a rural area to Kinross
in Mpumalanga to look for
opportunities. He started selling cars
but then started a business providing
services to Evander Gold Mine.
John Deere expands across Africa
John Deere, the agricultural giant, announced in April 2021 that it will bring its construction and forestry
product line back into its Africa Middle East branch. This expansion marks the first time that the John
Deere construction products will be sold under the John Deere name in these 18 countries: South Africa,
Botswana, Zimbabwe, Swaziland, Namibia, Zambia, Kenya, Uganda, Mozambique, Angola, Malawi,
Tanzania, Ethiopia, Egypt, Rwanda, Burundi, South Sudan and Sudan. John Deere is taking full control
of the marketing and support of its own branded construction products.
“This expansion provides an opportunity for us to increase our global footprint in the
construction industry, as we build upon our existing presence in Africa and deliver our product
portfolio under the John Deere brand for the first time to these key markets,” says Jaco Beyers,
Managing Director for John Deere Africa Middle East. “As we move into these new countries, we
are delivering on what customers expect from the John Deere brand.”
ocial
e in
nergy
)
ENT
le energy to
o-economic
ng social
ners?
/ 06-07am EDT
Inspiring the renewable energy sector
Many energy projects have community
participation and CSI projects but a
new initiative wants to ensure that
a real impact is made. INSPIRE (the
Initiative for Social Performance in
Renewable Energy) aims to ensure that
Africa’s just energy transition delivers
transformational
socioeconomic
benefits. The initiative was virtually
launched in June by several companies
in partnership with the renewable energy industry associations SAWEA and SAPVIA
and entities in the energy sector. The participants in the venture are
supported by Actis, Lekela and Biotherm
Synergy Global Consulting, Actis, Lekela Power, Biotherm, the South African
Wind Energy Association (SAWEA) and the South African Photovoltaic Industry
Association (SAPVIA).
DRA Global lists on the JSE
The trading of DRA Global’s shares commenced on the Johannesburg
Stock Exchange (JSE) in July, giving South African investors an
opportunity to invest in the diversified global engineering, project and
operations management company.
Founded in South Africa in 1984, but headquartered in Perth, Australia,
DRA Global operates mainly in the mineral resources sector, where it
provides end-to-end integrated engineering, project and operations
management services to customers developing and operating mining
assets. The company’s primary listing is on the Australian Stock Exchange
(ASX), and it also has operations across several key markets spanning
Europe, Middle East and Africa, Asia-Pacific and the Americas.
Valdene Reddy, Director of Capital Markets at the JSE, says DRA Global
is the sixth company to list on the JSE in 2021, supporting the appeal of
the Johannesburg-based bourse as a capital-raising platform.
JULY/AUG/SEPT 2021 • ISSUE 98
www.opportunityonline.co.za
JULY/AUG/SEPT 2021 • ISSUE 98
Momentum boosts women-owned businesses
The country’s official unemployment rate currently stands at 32.6% and the Covid-19 pandemic will cause more job losses. In the spirit of bolstering small and
medium enterprises (SME) in order to increase job opportunities, Momentum recently chose five women-led businesses to receive a share of R1-million as well
as some invaluable coaching as part of its Budget Speech #AdviceForSuccess competition.
Charlotte Nsubuga-Mukasa, Head of Momentum Brand at Momentum, says that SMEs make up 98.5% of formal businesses
in South Africa, which means that successful SMEs can have a significant impact on our economy. The latest Momentum | UNISA
Household Financial Wellness Insights shows that women were hardest hit by the lockdown. Just over a million either lost their
jobs or were prevented from working. The Budget Speech #AdviceForSuccess competition asked people to nominate deserving,
local woman-owned businesses. One of those chosen was The Trea Garden, an outdoor area and café based in Midrand (Gauteng),
owned and run by Amanda Yoyo.
Vodacom’s launches VodaPay Super App
Vodacom’s VodaPay Super App aims to be a game-changer for driving financial inclusion and economic growth in
South Africa. Developed by Vodacom Financial Services in partnership with digital lifestyle services platform Alipay,
VodaPay is an all-encompassing mobile payments solution that has been customised to meet the specific lifestyle
and payment needs of consumers, businesses and tech developers.
Developers and businesses of all sizes are invited to join the VodaPay ecosystem by building their own Mini
Programmes. This allows them to leverage off world-class technology to accelerate digital engagement and increase
access to market. The VodaPay Super App offers endless possibilities in acquiring new customers, trading, and advertising.
These third-party downloadable sub applications run within the VodaPay Super App and are available to all consumers to
enhance their lifestyle. Shameel Joosub, Vodacom Group Chief Executive Officer, says, “Since we announced the VodaPay
Super App in July last year, we have made significant strides in developing this technology solution that will transform
the fintech ecosystem in South Africa.
Fortress REIT kickstarts logistics strategy
Fortress Logistics Real Estate’s
commitment to develop over a
million square metres of logistics
assets over the next two to three
years, effectively transforming the
weighting of its portfolio to two-thirds
big box logistics, came into its own in
2020/2021.
“The strategy equipped South Africa’s largest supplier of logistics real estate
with the ready-built runway to support key clients’ new supply and logistics
strategies in response to the Covid-19 pandemic,” said Jason Cooper, Head of
Development at Fortress REIT.
Fortress Logistics Real Estate’s focus combined with its commitment to
developing quality infrastructure at prime locations close to the airport and the
Port of Durban saw all of its speculative buildings let.
Increased roof heights and yard dimensions in logistics parks meeting
increased global fire regulation, security and insurance standards underpinned
Fortress Logistic Real Estate’s success throughout the Covid-19 period.
Fortress’s Clairwood Logistics Park (pictured) concluded large deals with Kings
Rest Container Group and African Sugar Logistics. The development of a 56 000m²
container terminal within Clairwood for Kings Rest to be completed in September
2021 will extend the ability of King Rest’s existing container facility within the
port of Durban.
Rand-Air aims for best fit
Rand-Air has announced a fleet renewal programme to ensure customers
receive the best fit possible: “the right fleet, at the right time and at the
right price”.
Rand-Air, a supplier of air, nitrogen, power, flow (pumps), steam
boiler and lighting solutions, is part of the global Atlas Copco Specialty
Rental division. Having an up-to-date fleet allows for operational agility
and is critical to the success of customers.
“Continuous fleet renewal is imperative, as this practice enables
Rand-Air to retain and effectively manage a constantly updated fleet
of equipment – featuring the latest world-class technologies, improved
lifespans, efficiencies, reduced environmental impacts and increased
user-friendliness. Such a fleet reflects our ethos and tagline of “making
agility count” for our customers, by ensuring lower operating costs,
efficient production and sustainable profitability,” says Rand-Air Sales
and Marketing Manager, Byrone Thorne.
While the “best fit” offer is effective for short-term rental solutions,
longer-term rental solutions may be more customised according to
requirements. With more specific factors
taken into consideration, such as energy
consumption, Rand-Air’s products may
feature variable speed drives (VSDs) for
enhanced energy efficiency over longer
periods, Thorne explains.
INTERVIEW
Ability, agility and sustainability:
what modern government
can look like
The Executive Mayor of Midvaal Local
Municipality, Alderman Bongani Baloyi, is
proud of seven consecutive clean audits
and believes that stability and good
systems are vital in attracting investors.
Midvaal is a local municipality within the
Sedibeng District Municipality in Gauteng.
10 | www.opportunityonline.co.za
What are the main economic activities of Midvaal?
The main activities centre around manufacturing in the steel industry and
manufacturing components, followed by some financial services and government
services and trading. The manufacturing sector is positively linked to the steel
industry with companies linked to downstream beneficiation. They tend to be
small engineering companies and the mining sector has been a key contributor
with Afrimat Mines and a few other quarries.
Has your economy been affected by the problems in the steel industry?
We struggled a bit when there were the challenges caused by the import of cheaper
products from China. The immediate impact was that manufacturing production
went down. Coupled with the unreliable electricity from Eskom and also the price
of electricity, companies complained that it was making them uncompetitive. Our
municipal income decreased because some companies went from running four
premises to two premises so electricity revenue was reduced.
What is council doing to assist existing businesses?
Firstly, we must do our work, that is the most important thing for us to keep and
retain or even attract businesses. I must ensure that efficient services are given
which people are paying for. There is reliability and stability.
When you go to a bigger company, then you can start intervening in specific
ways. They might say, “Can we do a reservoir if the municipality does not have the
money?” They build it and then donate it to the municipality. Then the municipality
can look at a longer-term deal for water and electricity, assisting them to remain in
the municipality. This is how we come up with practical solutions for growth.
At most there must be two people and an executive committee which
ultimately makes the decision to ensure that we remain competitive and agile in
our ability to make decisions.
Agile is not a word one often hears with regard to government.
We often say to our businesses they must engage directly with our Head of
Development and Planning. That is the first touch point.
When there’s an escalation, it goes to myself and the Municipal Manager. That may
result in a requirement for a decision by the mayoral committee or council so it goes
back to the two people and one committee and a decision is to be made.
If you are running at such a pace you make it nearly impossible for people not to
want to invest in the area. Through word-of-mouth people say, in our area we had two
calls and the issue was resolved, we met with the mayor. We made a compromise and
we are moving ahead and a decision has been made.
That type of agility is needed to ensure that we set the bar and ensure what a
modern government can look like insofar as its ability, its agility and its sustainability.
Biography
Repaying a debt
Bongani Baloyi grew up on the East Rand and
clearly remembers the bloodshed of the 1990s.
He can remember the smell of teargas.
His commitment to public service had its origins
in those years. Says Baloyi, “I think it has been
frustration from a very young age that things were
moving very slowly. I realised that society is not the
way it should be.”
He quickly worked out that his mother having
to work as hard as she did for little return was “a
function of human control”. It became “important
for me to change the one thing” that could improve
the lives of people, and decided that politics was
the vehicle.
He was schooled at well-resourced, formerly
white schools, partly through the drive of his
mother to ensure that her first-born had access to
education and partly through the generosity of
sponsors.
Many times someone came forward to assist.
Throughout my school education various people
assisted. The difficult part for me is that there are
many people whom I don’t know how to say
thanks today to, because they wanted to remain
anonymous.
“So much of my approach to help those who
can’t help themselves is to try to repay this debt.
I would not be who I am today without that help
from those who assisted me through schooling.”
And start-ups?
What we can do with regard to start-ups is very limited. We can streamline some of
the procedures and the key question is which leg of these applications don’t require
a permanent change of a land use. We might be able to go the consent route.
What are the main economic sectors you are targeting?
Residential has grown significantly. Farm portions are now settlements but that has also
meant that the agriculture sector has declined. So we believe that with agro-processing
and beneficiation down the value chain, we can harness the jobs that we need for the
skill level of the unemployed. That way, it can be much more sustainable.
The second part is tourism: with the biggest nature reserve in Gauteng and
attractive water bodies, we can combine the wonders of nature with the political
INTERVIEW
heritage. We are not doing that very well at this stage; it is just a
20-minute drive from Johannesburg to enjoy all of these things.
Please tell us the story of Heineken in Midvaal.
Is this an example of partnership?
Heineken is a great development. To date they have spent in
excess of R7-billion in the municipality upscaling their facility
and really gearing themselves to compete progressively.
It was a flagship development. Now if you look around there’s so
many other industries and businesses that have moved, some are
part of the value-chain for Heineken. This is getting development
going along the R59.
Heineken has been a really good corporate citizen. We have
partnered on some incredible CSI projects which have left a lasting
legacy in the municipality from primary healthcare, monitoring vehicles
and others.
From the bulk services point of view there have been some
interesting solutions. We are currently in a discussion with them
about a 10MW solar plant.
What is the R59 development?
This is an iconic part of the municipality, demonstrating our intention
to draw and attract business. The R59 is a major regional route which
goes through the municipality from Johannesburg to the Free State.
The route also hosts two-way infrastructure, one is a Sasol pipeline,
the second part is the Rand Water pipeline that feeds Gauteng. We
want to help industry develop along that spine. The R59 today is
what Midrand was 10 or 15 years ago.
These nodes have been identified for projects: Wildebeest
Fontein, De Deur, Mamello, Waterval and Sicelo.
Midvaal has received international awards for “excellence
in investment and innovation” – what are the factors that
won that award?
It reflects the idea of service to the community, the strength
of our governance in Midvaal that has created the stability
and predictability and our agility in making decisions. In the
Heineken experience, we had to work within different time
zones when the executives from Heineken were sitting in
Holland. We even signed an agreement which had penalty
clauses where if we could not make decisions in a timeframe,
then we would pay penalties.
My predecessors started a very different strategy compared to
everyone else. We started to operate outside of what people see as
normal limitations.
We started saying what do you need, let’s see how we can make
it possible, and go the extra mile because we understand the
importance of these developments.
What are the most attractive opportunities for future
investors?
We want to engage with unlocking access to industries that are
important for the future. Energy is incredibly important, whether
it is through the traditional means or alternatives means or
through waste-to-energy.
The Heineken brewery has expanded operations several times in recent years.
Credit: Esaba Consulting Engineers
I believe grey water is the liquid platinum of the future. We should
have innovative mechanisms to reutilise water in various stages in an
efficient and effective manner.
Finance is linked to technology and I think that municipalities should
venture into integrating research and development in those industries.
If a fintech company wanted to invest, would you have
enough bandwidth?
It has to start with finding a partner who is prepared to lay the
foundation of the infrastructure. With Heineken we did not have a
reservoir and a sub-station at first. We need an initial partner, then
we would be able to get in other players later.
How did your organisation achieve seven consecutive clean
audits?
Fortunately, I am head of a stable municipality which has the basic
policies all in good working condition and the right institutional memory.
What I had to do was build and improve the systems and processes.
You need to worry about the thing that delivers consistency. It has
brought the culture of performance, accountability and transparency but
also we have a deeply embedded culture of compliance.
On average, we are achieving 94% with our audits, year-on-year, so the
system is also able to deliver.
We are strengthening our governance: every year we are finding
flaws and the Auditor General is assisting us to say you could improve
in specific areas. This an opportunity to improve our systems.
Are your staff proud of their record?
Oh absolutely. All of them they would walk around with their medal if
medals were presented every year! I think they know the public appreciates
them. My responsibility is to remind them of the goal. When people tell us
how wonderful and fantastic we are, I am the guy to remind them of the
road still ahead, and what we still need to achieve. The worst thing is to
believe the hype and drop your performance and your integrity and the
respect that you have for the system and for the consumer we are working
for. Those are the things we must guard against.
12 | www.opportunityonline.co.za
PROFILE
Midvaal Local
Municipality
Inclusively serving the needs of the community.
Contact details
Customer Services: 0861 643 8225
Fax: +27 (16) 360 7519
Email: via website
Website: www.midvaal.gov.za
Midvaal Local Municipality is one of three local municipalities within
the Sedibeng District Municipality, located in the Southern region
of Gauteng Province.
The principal towns in the municipality are Meyerton, where the
municipal offices are located, Daleside, Randvaal, Henley on Klip,
Walkerville and De Deur.
Natural features include the Vaal River and Dam, Klip River and
the Suikerbosrand Nature Reserve.
Fast facts
Size: 1722km²
Population: 111 600
Major sectors
Manufacturing: 29.5%
Financial and business services: 18.5%
Trade: 14.5%
Major routes
R59 freeway (Midvaal's major development corridor); N1; N3; R82
Awards
2021 Golden Arrow award, PMR Africa
2021 Most proactive Mayor award in Sedibeng District
2020 Seventh consecutive clean audit
2018 Best Performing Municipality: service delivery satisfaction,
GCRO survey
Vision
To inclusively serve the needs of our community.
Mission
We strive daily to enrich the lives of our people, by:
• Adopting a mindset of innovation to revolutionise the way we
operate
• Leveraging partnerships to realise our full potential
• Driving sustainability within the local ecosystem
• Growing the economy in Midvaal, premised on incubating
entrepreneurship, socio-economic growth and environmental
responsibility
• Providing excellent and standardised service delivery for all
• Prioritising the upliftment of our youth
• Being an ethical and proactive local municipality
• Elevating Midvaal to be the best and most attractive municipality
in the country
Credit: Property24
www.opportunityonline.co.za | 13
LOCAL GOVERNMENT
Promoting women in
business and giving
youth opportunity
The Midvaal Local Municipality is committing
resources to uplifting women and young people.
Junior Council
The Junior Council Programme is one of the ways
in which the municipality contributes towards
educating and developing the youth in Midvaal. It
helps to fosters and create a sense of civic awareness
and pride among youth.
This programme has helped to promote
tolerance by introducing leaners to various cultures,
languages and practices.
Midvaal Junior Council meets monthly to cater for academic
activities from participating schools. After every meeting, the
Junior Council debate different topics with an emphasis on
citizen responsibility.
Youth Council activities include but are not limited to: computer
training programmes; learners’ licence preprogramme; “Donate
67 minutes” to cleaning up the results of illegal dumping;
report-writing skills; life skills; active participation in community
development programmes; conservation.
14 | www.opportunityonline.co.za
Sebenza Mbokodo Women’s Project
The Sebenza Mbokodo Women’s Project was established in 2019 by
the Midvaal Local Municipality Executive Mayor, Alderman Bongani
Baloyi. Its primary focus is to provide access to funding, specifically
to qualifying women-owned businesses that operate in the informal
trading sector of the municipality. Through this project, womenowned
businesses will not only be provided with funding but access
to development where needed.
Midvaal Local Municipality
and Standard Bank Enterprise
Development will fund the
Sebenza Mbokodo Women’s
Project. Both parties will
contribute towards a fund
which will be established by
Standard Bank for the sole
purpose of supporting this
project. This collaboration is a result of both parties sharing the same
sentiments and focus where business development is concerned.
The partnership is built on the premise that the municipality intends
to empower, capacitate and support women-led informal businesses.
Funds from the Sebenza Mbokodo Women's Project Fund will be
provided to qualifying women-owned businesses so that they can:
• Grow their business
• Be able to compete with formal business
• Obtain materials and equipment for their business
• Prepare business plans for future expansion
• Provide goods and services to the current markets and to new markets
• Obtain relevant training and experience to grow their business.
Potential beneficiaries of the fund are all informal traders
(unregistered women-owned businesses) operating from the
township or town within the informal trading sectors operated by
women with spaza shops, fruit and vegetables, food preparation
and selling, hair salons, sewing and dress-making.
Standard Bank is proud to be part of this project and will continue
providing a zero-percent interest-free loan of R10 000 to qualifying
SMMEs for 24 months. Through this partnership, the bank wants to see
women entrepreneurship thrive through local economic empowerment.
As a municipality that cares, the Midvaal Local Municipality is
committed to creating a conducive environment for growth and
development for all its inhabitants, businesses, residents, investors
and other relevant stakeholders.
Kgatelopele Youth Development Programme
Midvaal is committed to promoting and supporting the development
of the youth within its municipal jurisdiction through programmes that
are aimed at:
• Skills development and training
• Entrepreneurship
• Business development
• Support for co-operatives and small, micro and medium enterprises
• Support graduates who can’t find employment.
The Executive Mayor has identified youth development as one
of the critical areas that needs intervention to alleviate the high
unemployment rate, poverty and socio-economic ills.
The programme trains youth in skills development, business
administration and management, entrepreneurship, and sectorspecific
technical skills.
About R1-million was used for training and development, and
R30-million worth of opportunities was set aside for this programme.
Youths who graduate from the programme are considered
and linked to job opportunities for further training programmes.
The Kgatelopele Youth Development Programme was
conceptualised and implemented with an objective to
empower and capacitate the youth so that they can compete
fairly within the municipality’s procurement processes and
other business interests.
Kgatelopele companies are continuing to express interest
in municipal procurement opportunities and some have
been awarded tenders. Some of the Kgatelopele companies
participated in the “War on Leaks” programme which was
implemented across the municipality.
The municipality will continue to explore opportunities for
Kgatelopele companies.
Tenacity brings success
In the early days of the Kgatelopele Youth Development
Programme, success rates were low but the drive of one
enterprising entrepreneur to build a good business shows what
can be done.
When Alfred Taikie Ngaloshe (also known as Wes) decided to sign
up for the programme, he didn’t just sit on his hands. Executive Mayor
Bongani Baloyi remembers being “hounded” by the garden services
entrepreneur, but also being hugely impressed by his “tenacity”.
“He wanted a response on consecutive days. How do I do this,
why is this like this, why is this like that,” recalls Baloyi. “He wouldn’t
just wait for things to happen. He was really empowered and this is
why this fellow is successful; the differentiator is the attitude.”
In the 18 months since Wes joined the programme
Woodpeckers Garden has
expanded operations, bought
new equipment and taken
on staff. The company has
also expanded into the
construction sector.
As Mayor Baloyi puts it,
“When you see the passion and
the drive then you realise why
he is successful compared to
the others in the group.”
www.opportunityonline.co.za | 15
LOCAL GOVERNMENT
Guiding the transition
A recent special meeting of the South African Local Government
Association (SALGA) focussed on renewal in the runup to elections.
Credit: SALGA
SALGA President Councillor
Thembi Nkadimeng called
for practical plans for
improvement in municipal
performance as the South
African Local Government Association
(SALGA) convened for a special National
Members Assembly (NMA) in May.
The hybrid two-day event brought
together people from government, heads
of Chapter Nine institutions, civil society
and the research community with a limited
number of delegates attending in person
at the Radisson Blu Gautrain Hotel in
Sandton, Johannesburg.
The event was held under the theme,
“Guiding the Transition: An opportunity
to renew as we usher in the 5th Term of
Democratic and People-Centred Local
Government.” The aim of improving
service delivery was at the centre of
deliberations.
Councillor Nkadimeng (pictured)
stressed that practical actions plans
would strengthen municipal capacity
and performance, which in turn will help
improve service delivery outcomes over
the next five years of local government.
“As we are all aware, the local government
elections are scheduled to take place
towards the end of October this year. It has
therefore become necessary to prepare
for the transition that municipalities will
experience before, during and post the
elections,” Cllr Nkadimeng said.
As the fourth term of democratic local
government nears an end, the NMA
assessed preparations for the upcoming
local government elections on 27 October
and adopted a management and transition
framework for the fifth term of democratic
local government.
“Our intention is to ensure the development
of a comprehensive programme of
guidance and support, in response to
potential challenges that may be faced by
municipalities during the transition.”
Cllr Nkadimeng also announced
that the Statutory Affairs Committee
of SALGA was tasked with the role of
drafting governance and reputation
management protocols that will guide
the organisation’s handling of National
Executive Committee (NEC) and
Provincial Executive Commitee (PEC)
members facing serious allegations of
impropriety and unethical conduct.
She added that the NMA would take
these protocols a step closer to reality.
Delivering the keynote address, Chairperson
of the National Council of Provinces (NCOP)
Amos Masondo pointed out that many
countries across the globe and international
institutions such as the United Nations (UN)
regard South Africa as having one of the most
progressive constitutions in the world.
He said South Africa’s constitution
enjoys high acclaim for how it defines
a constitutional democracy with a
three-tier system of government and an
independent judiciary.
“Under our constitution, a municipality
has the right to govern, on its initiative, the
local government affairs of its community,
subject to national and provincial legislation,”
said Masondo.
Panel discussions triggered an exchange
of ideas, collaboration and engagement on
a broad range of topics in the field of local
government. Panel moderators Sakina
Kamwendo and Clement Manyathela were
tasked with the responsibility of keeping
the conversations on track throughout the
two-day event.
16 | www.opportunityonline.co.za
LOCAL GOVERNMENT
A critical reflection on the fourth term of
democratic local government
During discussion on this topic, SALGA
President Nkadimeng outlined the role
of SALGA in supporting, promoting and
improving local government in line with
the organisation’s mandate. She honed in
on SALGA’s efforts to improve the financial
reporting quality and processes of their
members’ municipalities across the country.
After noting SALGA’s eight clean audits
in a row she stated, “With the limited
resources we have, we’ll adopt
10 municipalities per financial
year, and take our expertise as
SALGA to municipalities to assist.
We can’t be bystanders when we
realise that there’s a problem.”
Masondo said that despite the
numerous critical local governance
challenges that needed immediate
attention, local government has
made meaningful progress in
transforming the lives of the country’s
black majority, who had been
denied participation in political and
economic life under apartheid.
“People who are saying that
there’s nothing at all that has been
done are removed from reality. If
you open a tap, there’s water, there’s
electricity. There may be problems
about supply and outages, there
are roads, rubbish gets picked up
regularly,” said Masondo
“This is not to say that there
are no problems, problems are
there but we must not also deny
the reality of things and progress that has
been made since 1994.”
Professor Jaap de Visser, Director of
the Dullah Omar Institute, University of
the Western Cape (UWC), recommended
political parties to improve their candidate
selection lists ahead of the 27 October
municipal elections, where councils
for all district, metropolitan and local
municipalities in each of the country’s nine
provinces will be elected.
“Political parties would have to
distinguish the opportunists from the
real leaders,” Prof De Visser said. “Political
parties must ask themselves what should
disqualify a person to run for election.”
Lechesa Tsenoli, Deputy Speaker of
the National Assembly (NA), emphasised
the importance of SALGA’s Integrated
Councillor Induction Programme (ICIP),
which caters for newly elected and
returning councillors with the aim of
improving professional practice and
institutional capacity in local government.
The state of readiness for the electoral
transition
Thabo Manyoni, chairperson of the Municipal
_________________
“This Special NMA has witnessed
an unprecedented and major
convergence of views that is groundbreaking
for local government.
Despite the complexity of using
this hybrid format of engagement,
from a content perspective we
all agree that we must not only
adopt and embrace the Special
NMA Declaration, but also take
bold and proactive steps to
implement and accelerate it.”
________________
Demarcation Board (MDB), briefed the NMA
on the delimitation of the municipal wards in
preparation of the 2021 municipal elections.
Wards are delimited every five years in
metropolitan and local municipalities for
electoral purposes caused by changes in
the number of registered voters as a result
of migration and the enrolment of new
voters on the voters’ roll.
“On the 1st of December 2020, the MDB
handed 4 468 ward boundaries to the
IEC to prepare for the Local Government
Elections in 2021,” said Manyoni.
July 17-18 has been announced as the voter
registration weekend for the local government
elections taking place on 27 October.
On these days, all 23 146 voting
stations around the country will open
from 8am to 5pm to assist new voters
to register and existing voters to check
and, where necessary, update their
registration details.
Managing the transition
Nkosinathi Mthethwa, Minister of Sports, Arts
and Culture, spoke about the transformation
of South Africa’s heritage landscape. He
emphasised that to build a truly non-racial,
non-sexist, democratic and prosperous
society, processes of removing the
vestiges of colonialism and apartheid
racism were important.
He also spoke on how certain
monuments, symbols, signs and
statues in public spaces carried a
history of oppression and tyranny
and that it was important for South
Africans to begin having conversations
on what their role should be in a
democratic dispensation.
“Do we create a concentration
camp of unwanted statues with a
narrative or do we leave it to those
who still value them to preserve
them thus running a risk of reigniting
old right-wing nationalism by
privatising public property. Do we
allow for a juxtaposition of these
statues as it is the case in the Union
Building where President Mandela
is given prominence and centrality
while Hertzog was moved to a less
prominent space?” he asked.
Dr Nkosazana Dlamini-Zuma,
Minister of Cooperative Governance
and Traditional Affairs (COGTA), spoke
about the feasibility of conducting free
and fair elections in the shadow of the
Covid-19 pandemic.
She emphasised that while the country
was ready to hold elections in October,
several other considerations, including the
legal, socio-political, health and practical
would also be assessed.
Cllr Nkadimeng brought the NMA to a
close, saying she was confident that the
discussions emanating from the NMA
would translate into actionable strategies
to improve service delivery outcomes over
the next five years of local government.
www.opportunityonline.co.za | 17
SMALL BUSINESS
The key to a successful
economy is a better
balance of SMEs
As financier Business Partners Limited marks its 40th-anniversary
milestone, Managing Director Ben Bierman reflects on how the
local SME sector has still not reached its full potential.
The positive role that small and medium enterprises
(SMEs) play in the local economy has been raised
time and time again and is largely undisputed. From
providing employment opportunities, to solving business
challenges, these businesses can offer an innovative and
agile approach oftentimes lacking in larger companies.
SMEs have, however recently had to overcome economic
headwinds, even pre-Covid-19, due to a sluggish economy
and, added to the recent challenges of the pandemic, will likely
continue to face challenges such as the high cost of running
a business, excessive red tape, access to markets, financing
and technical knowledge. This is according to Ben Bierman,
Managing Director of Business Partners Limited, a specialist risk
finance company for formal small and medium owner-managed
businesses, reflecting on the company’s past four decades in the
local SME financing landscape.
“Looking at various first-world economies, it’s clear that a good
balance of different-sized businesses and equally distributed
wealth in the business sector is crucial to a thriving economy,”
Bierman points out. “In South Africa, most of the economic
power has for too long been held by the large corporates, and
for our economy to grow and thrive, a larger base of mediumsized
businesses is required. This key shift, however, requires an
ecosystem that better supports these businesses.”
Bierman adds that Business Partners Limited is proud of the
contributions made to the SME ecosystem, albeit more remains to
be done. The year 2021 marks the company’s 40th anniversary, and
to date Business Partners Limited has provided R20-billion in finance
to South African business owners via more than 71 000 transactions,
which has in turn assisted in facilitating over 671 000 jobs in the
country.
Bierman says that over the past 40 years some of the key
challenges that were facing the industry have remained and include
a lack of financial literacy among business owners, non-compliance
with legislation and the availability of collateral which hinders access
to much-needed financing opportunities. The challenges are even
more pressing today as SMEs battle to survive the current pandemic.
He highlights some of the key changes he has witnessed, as
well as urgent efforts that need to be taken by both South Africa’s
government and private sector, in order to better support SMEs as
the country paves the road to recovery:
Tshepo Mekoa’s business Brima Logistics was expanding until Covid-19 hit, then
he had to adapt and show resilience. One of the sources of support finance for
the business was an emergency loan from Business Partners Limited.
18 | www.opportunityonline.co.za
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Harness technology to become more client-centric and give support
quicker and more efficiently
There have been great forces of change in the macroeconomic environment
and the biggest driver of change in the past few years has been technology.
Due to improvement and access to technology, we have had to adapt to
doing things quicker to meet client demand in terms of decision-making
and support. Big data, fintech and systems play an ever-increasing role in
shaping the way financial institutions operate, especially to improve the
understanding of the client’s needs and the ability to assess business risk.
Red tape to be trimmed to increase ease of doing business
SMEs often lack resources within their organisation to deal with legislative red
tape. Often the entrepreneur or business owner spends more time jumping
through administrative hoops rather than focus on running their businesses.
Cumbersome legislation often becomes the biggest stumbling block for SMEs
to develop access to markets, improve the ease of doing business, grow their
businesses, or create much-needed jobs.
It’s more important now than ever to invest capital and other resources into
SMEs, as well as cut some of the red tape that exists in the legislative environment
that makes it difficult to grow and create jobs. In comparison to big corporates,
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In this ever-changing and uncertain environment, it is difficult for any business
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20 | www.opportunityonline.co.za
www.opportunityonline.co.za | 21
SMALL BUSINESS
Fuel for growth
Why access to capital is important for SMEs
Regardless of the size of your company or how
great your product might be, at some point
every business will need more finance than they
have immediately available. When this happens,
accessing additional funding will help to give
your company the fuel it needs to grow.
It may seem counterintuitive, but Trevor Gosling, co-founder
and CEO of Lulalend – financing partner to South Africa’s smallto-medium
enterprises (SMEs), explains that fast access to capital
plays an important part of any business growth strategy.
Gosling says that there is often a misconception that all debt
is bad or that it is only used by struggling companies. “In fact,
the opposite is often the reason why some of the world’s largest
companies routinely seek capital infusions to drive growth,
keep profits within the company and assist with short-term
financial obligations.”
When raising funds, the financing option selected will play an
important role in determining how a business accesses capital
and its long-term profits.
“For business owners, debt can help to improve the bottom
line of a company because it makes expansion possible. It can
enable increased marketing efforts or the purchasing of new
equipment and products,” says Gosling.
Loans can also support seasonally-driven companies that are
often extremely profitable during peak-season trading but need
the extra cash to buy inventory and supplies during the quieter
months. This is where debt can help to bridge the gap and
balance out uneven cash flows throughout the year.
Generally, the two most common ways in which debt is raised
are through selling equity in the business or with debt financing.
For many of South Africa’s burgeoning SMEs, what matters
most is the overall cost of business funding and the speed at
which it can be acquired. While both financing options can help
to give access to capital, using debt to support growth rather
than equity is generally preferred.
As Gosling explains, “While you will owe interest on debt,
unlike equity, the funding that it provides doesn’t mean you will
have to lose a stake in your business. Any profits that are made
will be yours to keep.”
Additionally, if you choose to take on a partner to increase
capital, it will also mean that you lose full control of your business
and you will be asked to share profits in the future, which for
many fast-growing start-ups is not an attractive option.
While fixed-term loans are a great tool to finance inventory
or equipment purchases, an increasingly popular debt
instrument is a business line of credit, or Credit Facility.
Gosling says that a Credit Facility is one of the best ways to
manage cash flow, especially if a business needs immediate
access to funds to cover short-term expenses while waiting
for customer payments.
Have a plan to use additional funding
If you manage your debt responsibly by making on-time payments,
this can also help to improve a business’s creditworthiness. In turn,
these smart credit habits can help to increase your overall spending
limit, lower future borrowing costs, and help you to obtain better
terms for future loans.
“The critical step that business owners need to consider before
taking on any form of debt is to ensure that they have a plan
on how to use any additional funding to generate a return and
improve profits,” Gosling explains.
“If you don’t have a plan, or if you feel that the company is
struggling financially, taking on debt for the wrong reasons can
cripple your business,” he adds.
To assist businesses to recover and grow during these difficult
times, Lulalend is offering its first-time customers the opportunity
to take out funding but only start repaying after 60 days, which
gives them two months of cost-free capital.
“It is not just about your bottom line. If done correctly,
responsible debt can grow your company and give it the strategic
advantage needed for a profitable future,” says Gosling.
22 | www.opportunityonline.co.za
INFRASTRUCTURE
Researcher and writer Sello Mabotja investigates how infrastructure investment
is set to play a leading role in reversing the effects of the Covid-19 pandemic and
weathering the simmering economic maelstrom.
_________________ ____
“Government recognises that infrastructure investment is a critical
driver for the future growth of the South African economy. South
Africa requires a catalytic kind of infrastructure investment that
will contribute to higher long-term growth, and address spatial
disparities, transform the economy and create much-needed jobs.”
- The Presidency
____________________
24 | www.opportunityonline.co.za
INFRASTRUCTURE
ACHIEVING ECONOMIC
RECOVERY THROUGH A
BRICKS-AND-MORTAR PATH
Giant cranes shift thousands of tons of coal every year at the Richards Bay Coal Terminal. Credit: RBCT
The ubiquity of the “I” word in South Africa’s economic
recovery lexicon permeates almost all plans when
strategies about how to arrest the decline plaguing the
domestic economy are mooted and discussed.
Infrastructure-led economic growth and development
appears to be on the cusp of being the in thing and it is often touted
as a key driver of envisaged economic recovery.
But this newfound panacea will not be a plain-sailing exercise as
there are hurdles which still need to be overcome.
In the next three years, an amount of R791-billion has been
allocated to spending on infrastructure and this includes
expenditure by State-Owned Enterprises (SOEs). This is in line with
the objective of shifting expenditure from consumption to investment
and over the medium term, expenditure on capital assets is intended
to grow by an estimated 12.5%.
Infrastructure spend has over the years declined below 20% of total
spending but government aims to increase its level to 30% by 2030 in
order to achieve the targets set in the National Development Plan (NDP).
A precipitous fall in investment has been the Achilles’ heel
of infrastructure development, which according to a Business
Leadership South Africa report, has declined from 20.3% of GDP in
2015 to 17.9% in 2019. The report notes that public sector spending
was 27% or R70 billion below budget in the 2019/20 financial year
compared to the previous year.
www.opportunityonline.co.za | 25
INFRASTRUCTURE
One of the major areas of focus of the national infrastructure programme is student
accommodation, as illustrated by this new development at the University of Fort
Hare. Credit: Stag African
Addressing Chatham House, the London-based
think-tank, on prospects for the growth of the
domestic economy, especially in the aftermath
of the Covid-19 pandemic, Mashatile noted that
the current health crisis has exposed gaps in the
provision of infrastructure and basic needs such
as healthcare, education, public transport, roads,
water and housing. Unofficial estimates are that
the country may need about US$100-billion to
recover from the coronavirus outbreak.
“Our point of departure is that the new economy
we are building must be more inclusive, resilient
and sustainable. We have taken the view that in
building a post Covid-19 economy, we need to go
back to the fundamental insights contained in the
Reconstruction and Development Programme
(RDP) of the early 1990s.”
Increased spending on infrastructure is therefore a sure signal
that the domestic economy is on an expansion trajectory and
economic activity is on the rise. In the long run, improvements
in productivity may be achieved and this will drive sustainable
economic growth, which leads to a faster pace of job creation.
The ultimate result is to achieve stabilisation and recovery of
government finances.
Amid a mixture of economic misfortunes include worsening
unemployment, rising poverty and inequality, and sovereign
debt downgrades by three rating agencies, South Africa also
experienced a record contraction of the Gross Domestic
Product (GDP) in the second quarter at the worse-thanexpected
51% at seasonally adjusted annual rate — which is
disconcertingly the fourth consecutive quarterly contraction.
Enter the Covid-19 pandemic era and a major spanner is thrown
into these works, already in disarray.
Unlike in the past where a smorgasbord of unrelated avenues
were being touted as the panacea for the ailing economy, there
is now a single view that massive investment in infrastructure
will undoubtedly turn the fortunes of the economy around.
Some of growth path alternatives punted as a saving grace
for the near-parlous economic situation included the tourism
and hospitality, beneficiation and trade sectors. However, none
of these have delivered as expected.
There are strong indications that players in both the public
and private sectors agree on this issue. The ruling party has
been among the leading proponents of this bricks-and–mortar
approach as a way of negotiating the economic pathway.
Paul Mashatile, ANC Treasurer-General, recently went public
and punted infrastructure spending as the main tool that will
ensure that the ruling party keeps most of its electoral promises
and thus fulfils its mandate.
“When voters cast their votes, it is not so much about what a
party promises to deliver but they are actually looking at what
has been done,” he said.
Private sector role
Against this background, government has engaged the private sector
and the multilateral development banks and designed an infrastructure
project pipeline totalling more than $20.5-billion (an estimated R350-
billion), focusing on network industries such as rail and ports, energy,
ICT, water, sanitation and human settlements.
In the 2021 Budget the government’s Infrastructure Fund was
allocated a whopping R18-billion over the next three years, This is part
of the R100-billion committed by government over a period of 10 years.
Managed by the Development Bank of Southern Africa (DBSA), the
fund intends to leverage R10 from the private sector for every R1 spent
by government. The ultimate aim is to achieve a R1-trillion infrastructure
spending programme and transform public infrastructure financing
through this blended finance approach.
The DBSA advanced close to R635-million as part of the capital to set
up this R100-billion fund. An estimated 177 projects across the public
and private sectors are already under consideration.
Having taken some time prior to being established after being mooted
by the President in September 2018, work has now started on three major
projects: student housing, water infrastructure and digital infrastructure.
The establishment of the Infrastructure Investment Office (IIO) last year
by President Ramaphosa is further evidence that economic recovery may
hinge overwhelmingly on big investment in this area and adds further
impetus to the infrastructure spending drive. Led by Dr Kgosientsho
Ramokgopa, the former Gauteng MEC for Economic Development,
this agency hit the ground running with the hosting of the Sustainable
Infrastructure Development Symposium (SIDS) in June 2020.
Notwithstanding all these laudable initiatives on the part of
government, the main challenge appears to be the details of the
financing of infrastructure spending. While experts are upbeat about
this economic direction, some have expressed concerns that the tight
national purse may affect the efficacy of this drive.
Says Siyanda Mflathelwa, Senior Infrastructure Finance Transactor at
Rand Merchant Bank, “The government has stated that infrastructure
development is one way to revive the ailing economy. Given the fiscal
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INFRASTRUCTURE
constraints the government is facing, it seems that public-private
partnerships may just be the appropriate tonic.”
Shawn Hagedorn, an independent strategy adviser, argues that
a feasible growth plan should be the main anchor of the country’s
economic recovery if infrastructure is to have the desired effect.
“None of our leaders has produced a viable growth plan, yet
many support ramping up infrastructure projects to spark jobs
and growth. While it is unrealistic for any country to expect
infrastructure investment to spur growth without a plan, SA has
special challenges. If we view the global economy as a computer
network, the cost of upgrading SA’s hardware is high, whereas
exceptional performance gains are to be realised through better
network integration,” says Hagedorn.
Hagedorn’s main concern is what he calls South Africa’s “central
political-economic disconnect”, which he explains as a situation that
is a diametric opposite of all successful economies worldwide which
thrive through extraordinary integration into the global economy.
He blames the failure of the domestic economy’s ability to take
off on the ruling ANC’s strong emphasis on redistributive economic
policies which focused predominantly not on global competitiveness
but redressing economic inequities without concomitant growth,
failure to embrace possibilities due to focus on correcting legacies as
well as an incessant debate of the imperfections of successful policies
as opposed to adopting and adapting those prescriptions.
“The country’s meagre growth prospects are due to overreliance
on domestic spending, despite most households being
poor. Government efforts to induce growth have been expensive,
ineffective and unsustainable in the decade preceding the Covid-19
pandemic, households and government became over-burdened
with servicing expensive debt, while GDP growth barely tracked
population growth. We are far along the path of triggering mutually
reinforcing debt and poverty traps.”
Notable successes for PPP
The exploration of the infrastructure-led economic growth path is,
however, not a novelty.
In 1998 the new public-private partnership framework was
inaugurated with the view to boosting the overall wellbeing of the
domestic economy. Using a hybrid mix of private and public sector
funding, estimates are that R90-billion has to date been procured via
Private steel fabricator and steel erector Betterect has recently invested
in semi-portable cranes by RGM Cranes. Credit: Betterect
this framework and government contributed at least R30-million to the
kitty. The model allows for the crowding in of public sector investment
and the acute shortage of funds on the part of government is
addressed as a result. Among the most notable successes of the PPP
framework is the Gautrain Rail Link Concession.
Although there appears no dissonance regarding this
developmental paradigm, some hurdles along this laudable
recovery path need to be tackled. For instance, the market should
not be forced to invest in low-yield, high-risk projects but those
which link funding to performance. Also, the use of any sort of
legislative instruments to force the market to direct its investments
into a sector for which its appetite is next to nothing may create
a huge disincentive. In a nutshell, any form of a prescribed assets
regime may seriously stifle the investment spending drive.
According to infrastructure investment expert, Jurie Swart, CEO of
African Infrastructure Investment Managers (AIIM), the private sector
has an appetite to partner with the government on its massive and
unprecedented infrastructure investment drive. However, he points
to the urgent need for high-level discussions to iron out the finer
details of the initiative, especially the governance procedures.
He adds that his organisation will, as the most experienced
private equity investment partner on infrastructure development
on the continent, with an estimated $2.1-billion under its
management in seven savings funds, be meticulous before it
commits funds to any project.
“We are the custodians of South Africa’s savings and it makes
sense that these savings are committed to sustainable projects that
offer appropriate risk-adjusted returns. These should improve the
economic wellbeing of the savers,” says Swart.
Despite concerns about rampant malfeasance and shoddy corporate
governance, government has in some instances notched up an
impressive record in managing PPPs. A case in point is the Renewable
Energy Independent Power Producer Procurement Programme
(REIPPPP), which boasts an estimated R7-billion in investments to
date. Commercial banks have also added close to R90-billion in this
programme in a bid to ameliorate the funding challenge.
As infrastructure spending gains impetus, construction and
engineering group WBHO is among its earliest beneficiaries and has
been awarded a R1.88-billion public-private partnership contract to
build a new accommodation office for the Department of Rural
Development and Land Reform.
Maybe government has finally found a path that will navigate the
domestic economy out of the doldrums and enable it to take off to
greater heights of prosperity. As KH Plant, a specialist construction
equipment company, noted in its 2021 Outlook for the South
African Construction Industry about the prospects of government’s
infrastructure endeavours coming to fruition and powering the
domestic economy to the long-awaited recovery:
“Despite the country’s economic standing, the fundamental need
for infrastructure remains. Demand is high for better and more roads
and other transport options, housing, power and other utilities and
so on. Government has already committed to using infrastructure
projects to drive post-Covid-19 economic recovery.”
28 | www.opportunityonline.co.za
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CONSTRUCTION
Mamonkwe Trading is a supplier of topquality
products and services within the
industries of logistics, plant hire and
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We distribute and deliver only high-quality products and
services through reliable and efficient solution systems.
Mamonkwe Trading is a black-owned multi-dimensional
services and products supply corporation based in Mpumalanga,
with offices on Winkelhaak Farm, Evander. Mamonkwe Trading
is a distinctive beacon in the industry because we go beyond
expectations in delivering a service to our clients.
Based on our humble beginnings, we are committed to
giving back to our community as part of our social responsibility.
Our Mission
Is to provide high-quality products and services that meet
our clients’ specific needs and provide valuable advice on our
products to assist our clients to save on operational costs.
Furthermore, we aim to deliver back to our communities as
part of our social responsibility obligations through outreach
initiatives.
Our Vison
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business into our neighbouring countries and beyond.
Heavy-duty equipment
We offer high-quality heavy-duty machinery:
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We specialise in the transportation of aggregates, earthmoving
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We have a diversified service offering which is provided to various
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Plant hire, construction, transportation, excavation, crushing, screen
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Civil construction
• Mining and mining reclamations
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The main goal of Mamonkwe Trading is empowerment and
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www.opportunityonline.co.za | 29
ENERGY
South Africa's
Petroleum Bill
Will it retain and attract investors in the sector?
By Callie-Jo Bouman and Nonkululeko Zondo, Bowmans
The latest draft of the Upstream Petroleum Resources
Development Bill has come under scrutiny since its
publication in June 2021. The bill comes at a time when
South Africa's upstream oil and gas industry shows
promise, as evidenced by the Brulpadda and Luiperd prospects
discovered in 2019 and 2020, respectively. Simultaneously, the role
of fossil fuels in the future of energy is under question in light of
the global aspiration to reach net-zero carbon emissions by 2050.
Notwithstanding the mounting pressure to reduce reliance on fossil
fuels, the upstream oil and gas sector still plays a vital role in South
Africa's energy policy and goals to achieve an “energy mix” that is
not reliant on coal.
The objectives of the bill include:
• expanding opportunities for meaningful black participation
• promoting local employment and skills development and
• creating an enabling environment for the acceleration of
exploration and production of the nation's petroleum resources.
Some of the bill's key features include mandated state participation
of 20%, 10% participation by black persons, and the empowerment
of the Petroleum Agency of South Africa to administer the
development of the upstream petroleum industry. Existing
rightsholders will perceive the bill differently from those new
entrants to the industry who will be governed entirely by the bill
once it comes into operation. Existing rightsholders will be guided
by the detailed transitional schedule, which will guide current asset
holders’ compliance and ensure the security of tenure in respect of
existing rights.
Credit: Anton Swanepoel
The impact of state participation
Under the Upstream Petroleum Resources Development Bill
(UPRDB), the state has 20% right to a carried interest in petroleum
rights, including both the exploration and production phase. The
state's participation includes a cost-recovery mechanism, which will
allow the exploration company to recover 50% and 100% of the
state's proportionate share of exploration and production costs. This
cost recovery mechanism is indicative of the state's willingness to
accept some of the risks associated with the exploration efforts that
involve high sunk costs, which are often upwards of $100-million,
and often no guaranteed return. The challenge, however, is that
these costs must be recovered from the state's share of production
30 | www.opportunityonline.co.za
ENERGY
or revenue generated from the project. Where the project does not
move to the production phase and generate revenue, there will be
no cost recovery. Even where the project generates revenue, it is
debatable whether the entire portion of the state's returns will be
capable of being allocated to cost recovery, which will extend the
repayment period.
National Treasury has not yet commented on the bill and we
expect that the exact cost-recovery mechanisms will be detailed
in subsequent regulations. Still, it will be interesting to see how
these cost-recovery mechanisms will interact with the capital
uplift and other tax deduction provisions in the Income Tax
Act's Tenth Schedule for oil and gas. The interplay between the
Income Tax Act and the cost-recovery mechanisms presents a
further opportunity to introduce a more attractive fiscal package
to potential investors.
A further change proposed by the UPRDB includes giving the
state an active role through joint operating agreements (JOAs)
that must be entered into with the state. The state is entitled
to voting rights corresponding to their 20% participation.
Depending on how the voting processes of the JOA are
structured, this may encumber the exploration company's
interests. While creating more transparency and reducing the
asymmetry of geological and commercial information available
to the state, this active participation may be perceived as being
more cumbersome to the companies' commercial decisionmaking
processes.
For current rightsholders whose rights do not provide for state
participation, these state participation provisions will only kick
in when the company applies for approval to progress to the
production phase in terms of the new bill.
BEE participation
In terms of the UPRDB, every petroleum right (which includes the
exploration and production phase) must have a minimum of 10%
undivided participating interest by black persons. The BEE participation
is on full commercial terms, and BEE partners will be expected to fully
fund their involvement at both the exploration and production phase.
Whilst this is welcome news for investors, there is a limited pool of BEE
companies and partners that would be able to field the costs associated
with exploration and production. As mentioned, exploration activities
are often estimated to be upwards of $100-million, and a BEE company
participating on full commercial terms will be expected to fund 10% of
those costs (approximately $10-million).
There may be instances where investor companies will have to
provide nominal funding to structure their ventures to comply
with the BEE provisions. In recognition of some of the funding
challenges, the bill permits the dilution of the BEE interest to
no less than 5% to raise capital. This dilution will not trigger any
requirements to “top up” the BEE participation to 10% leading
us to conclude that the “once empowered, always empowered”
principle will likely apply to BEE participation.
The Upstream Petroleum Resources Development Bill is a
welcome intervention in the sector and moves towards creating
certainty and clarity in the upstream regulatory environment. The
bill also introduces greatly expanded and tightened regulatory
processes for the industry. Still, it remains to be seen if investment
communities will find this attractive and whether it achieves its
objective to create an enabling environment that also meaningfully
expands opportunities for black participation in the sector.
ABOUT BOWMANS
Bowmans helps clients overcome legal complexity and unlock
opportunity in Africa. Our track record of providing specialist legal
services in the fields of corporate law, banking and finance law and
dispute resolution, spans over a century. With eight offices in six
African countries and over 400 specialist lawyers, we draw on our
unique knowledge of the business and socio-political environment
to advise clients on a wide range of legal issues. Our clients include
corporates, multinationals and state-owned enterprises across
a range of industry sectors as well as financial institutions and
governments.
Nonkululeko Zondo is an associate in the Corporate M&A
practice at Bowmans, and is completing a PhD on oil and gas law
at UCT. Callie-Jo Bouman is a candidate attorney in the Corporate
M&A practice.
Credit: PASA
www.opportunityonline.co.za | 31
INTERVIEW
Making investment in the
South African oil and gas
sector as attractive
as possible
Dr Phindile Masangane, CEO of Petroleum
Agency SA, outlines PASA’s new strategic
objectives as interest in South Africa’s
resources grows internationally.
What is the thrust of PASA’s new five-year strategy?
The Agency has identified five new strategic objectives to
enable it to effectively deliver on its mandate by capturing
the opportunities presented by the changes in the
environment as well as ensure that the Agency overcomes
the challenges that it faces.
These are:
• Increasing exploration activity: to move the industry from
a predominately exploration phase to development and
production phase
• Sustainability: to ensure the company has sufficient
financial and human resources to carry out its
responsibilities into the foreseeable future
• Advocacy: to provide input into policy and regulations
• Digital transformation: to adopt new, more efficient
technologies
• Operational excellence: to ensure efficiency of our process.
These five strategic objectives will position the
Agency as a strategic entity of government in its goal of
diversifying the energy mix and developing the domestic
gas market, embracing digitisation and automation to
improve efficiency, rising to the requirements of the new
legislation and finding a place in the global transition
towards a low-carbon future.
What is the mandate of PASA in terms of being
a “custodian” of the country’s oil and gas rights?
PASA’s mandate is threefold. Firstly to attract
investment to South Africa’s upstream industry,
secondly to regulate the activities of oil and gas
explorers and producers, and thirdly to act as the
national archive and database for all data and
information produced in the process of oil and gas
exploration and production. The upstream oil and
gas exploration industry requires technological
capacity and is extremely high risk in terms
of capital investment and needs long-term
investment of resources. Many countries share the
risk of oil and gas exploration and production with
private companies, and South Africa follows this
model. Government has designated PASA as the
custodian of South Africa’s oil and gas resources.
Its role is to attract these companies to our
investment opportunities and facilitate their entry
into operations in the upstream industry.
When will the moratorium on new applications for
rights be lifted and PASA be open for new bids?
As of December 2020, there is no longer a moratorium
on applications for rights onshore, other than those for
shale gas in a specified area covering the central Karoo.
Other onshore applications continue to be received and
processed in terms of the MPRDA. The moratorium for
shale-gas rights and new offshore applications remains
in place and is expected to be lifted with the enactment
of the hydraulic fracturing regulations (for environmental
management and water use) for the shale-gas extraction
technologies.
With a strong international focus on decarbonisation,
what is PASA’s position on the continued exploitation
of fossil fuels?
The transition to cleaner fuels and renewables is inevitable
if the world is to reduce the negative impact of climate
change. South Africa is a signatory to the Paris Agreement
and has committed to a “Peak-Plateau-Decline” carbon
emission trajectory. Government policy is to diversify the
country’s energy mix which is currently coal-dominated,
to a lower-carbon future by introducing proportionately
higher renewable energy resources such as wind and solar,
into the energy mix as well as gas-to-power. Gas burns with
less than half the CO2 emissions than coal and additionally
has no SOx emissions. It is thus a suitable transition fuel
32 | www.opportunityonline.co.za
INTERVIEW
Is there international interest in South Africa’s oil and
gas resources?
The exploration map on our website shows that international
companies such as Total, Shell, ENI, Kosmos, Africa Energy
Corporation, Azinam, Impact Oil and Gas, CNR, Qatar
Petroleum, New Age and others all hold interests in
exploration acreage. In addition, we have agreements in place
with international service providers to acquire seismic data.
towards a lower-carbon economy for South Africa
especially since gas-to-power technologies are flexible
and would therefore complement the intermittent
renewable energy being added to the national grid.
What is PASA doing to attract investment and
promote new drilling projects?
PASA continues with its programme of promoting
investment opportunities at local and international oil
and gas conferences and exhibitions. South Africa has
a history of political stability. The new administration
is widely regarded as business-friendly and the
new UPRD bill will assist the Agency in expediting
exploration through close management of acreage
allocation and work programmes. The bill also
empowers the Agency to commission multi-client or
speculative surveys, enabling the acquisition of data
to attract investment. South Africa currently offers
an attractive fiscal framework. These positive factors
create a conducive environment for the Agency to
pursue its mandate of attracting investment into the
upstream petroleum industry.
Does PASA have a strategy to retain existing
investors?
All investors want to see a return on their investment
and a reward for taking on risk. PASA’s approach is
to facilitate their activities and guide them through
compliance and regulatory requirements to achieve the
best outcome for both government and the investing
companies. Advocacy plays an important role and PASA
is concentrating on communicating the role that the
upstream industry can play in reconstruction and
development. A recent example was the facilitation
of logistics for the drilling of the Luiperd well during
Covid-19 lockdown.
What are the implications of the passing of the Upstream
Petroleum Resources Development Bill (UPRD) by the
South African parliament?
Oil and gas exploration and production is currently
regulated under the Mineral and Petroleum Resources
Development Act, 2002 (MPRDA). The UPRD will repeal
and replace the relevant sections pertaining to upstream
petroleum activities in the MPRDA.
The draft bill therefore provides greater policy certainty
and a stable environment for investment in the South
African oil and gas sector. The bill provides security
of tenure by combining the rights for the exploration,
development and production phase under one permit.
What changes are envisaged in the amendment to
the National Environmental Management Act of 1998
(NEMA)?
The National Environmental Management Laws Amendment
Bill, which was revived in June 2020, proposes various
amendments to the National Environmental Management
Act, 1998. Proposals that may positively impact upstream
petroleum operations include the provisions
empowering the minister responsible for
mineral resources to delegate to any
organ of state and designate as an
environmental petroleum inspector
any staff member of any other organ
of state that executes a regulatory
function. The minister may delegate
certain competent authority functions
to the Petroleum Agency SA, which
may improve the turnaround timelines
for making decisions on EA applications.
Furthermore, designating staff members
of the Agency as environmental petroleum
inspectors means that all compliance monitoring
and enforcement functions prescribed in the act
as far as upstream petroleum operations would
be efficiently executed.
Dr Phindile Masangane,
CEO of Petroleum
Agency SA
ENERGY
William Price, Country Manager of Enel Green Power South Africa, explains to Opportunity
how the company brings extensive global experience to multiple renewable technologies.
What is Enel’s footprint in South Africa?
Our footprint in South Africa includes 12 renewable
energy projects, using diverse technology, wind,
and solar. Our office in South Africa also supports
developments in Kenya, Ethiopia, and an operating
solar project in Zambia. Our structure is such that
we have three business units: Business Development,
Engineering, and Construction, as well as Operations
and Maintenance.
Our Business Development group has successfully
won tenders for the development of 1 260 MW, as well as
developing a pipeline for future growth. Once a successful
tendered project has achieved financial close, it is handed
over to our Engineering and Construction (E&C) team
who have, to date, built nine projects with a capacity of
800 MW and are nearing the completion of another three
projects with a capacity of 420 MW this year.
What does Enel bring to South Africa in terms of
expertise and technology?
Enel brings global experience and expertise in the
management of projects and in growing teams,
consistently; globally, we’re operating in over 30 different
countries. We have expertise in many aspects; however,
sustainability is one of our key drivers. The solar farms
and wind facilities that Enel is building are assisting the
South African market to transition to a renewable energy
future. Enel believes in creating shared value where we
have project sites. We also look at the impact on the
communities in which we operate.
From a renewable energy technology perspective,
there are not many companies like Enel. We are a multitechnology
company and constantly strive to improve
and learn from the projects where we employ cuttingedge
technology.
_____
Solar farms are helping
South Africa transition to
renewable energy while
creating shared value
with local communities.
What is Enel’s view on the state of the REIPPPP?
The REIPPP programme is among the best – if not the
best – renewable energy and Independent Power
Producer programme in Africa. It aims to accomplish
many goals that are commonly misunderstood. The
programme is not just about the procurement of green
power and renewable energy. Local content is also
significant, as is local manufacturing, local ownership,
a sustainable contribution to the community and
preferential procurement. If there’s a negative, it relates
to time frames. Now that frequent load-reduction is
being implemented, we need the energy to come
online and there’s a lot of fine-tuning and tweaking in
the programme which may cause significant delays.
Although there’s definitely been an improvement in
the realisation that we need greater power capacity and
delivery, rather urgently.
Is renewable energy on the rise globally in terms of
markets, prices and sustainability?
The uptake of renewable energy is certainly on the rise,
because the world is finally ‘getting it’. Government
entities are finally seeing the value of renewable energy
and its impact on the environment.
There’s the transportation of the coal, the heavy
truck emitting pollution, and damage to the road
infrastructure as well as the environment. People are
getting that.
Renewable energy prices have come down.
Independent Power Producers and manufacturers are
trying to figure out how to produce more with the
available resources they have. As equipment efficiencies
improve and the ability to produce energy improves, the
project tariffs will continue to drop.
Technological improvements have led to Enel
installing 4.2 MW wind turbines, which are currently the
largest onshore units in Africa, and soon even larger units
can be available.
All these things have an impact on the pricing and on
sustainability. We understand the value of doing projects
in a sustainable way, as well as providing value in the
communities in which we operate. It’s an important
distinction which we pride ourselves on.
What can be done to accelerate the ‘global transition’?
It has a lot to do with the government’s policies,
regulatory markets and opening up transmission
access. There are many Independent Power Producers
and energy companies that would like to establish
these projects. They don’t require the same degree
of specifications that combined cycle, coal plants or
nuclear power plants do.
To know how to run these projects and to build
technical knowledge is important. All renewable
The Local Control Room of Operation and Maintenance South Africa in
Johannesburg allows for real-time updates on energy production, the resources
available, and any issues that require attention. An intern programme has been
running since 2017.
projects have various types of technology and varying
levels of required skills, but many companies can build a
solar plant, so that creates competition – it opens up the
markets. Pricing is re-established through a procurement
process. A transparent credible tender will determine the
market pricing. To do that requires government actions
in establishing the regulatory policy and transmission
access. More clarity on the opening of South Africa’s
transmission structure is needed. There is some open
access, but the operating rules are somewhat unclear.
The cost mechanism is a key aspect that needs to be
ready for the time that open access is achieved. A good
comparison can be made with road infrastructure. The
government initially established the roads infrastructure.
The same thing should occur with the transmission so
that entities can enter into the transmission line just like
a road and deliver products to any customer along the
‘freeway’. There are technological challenges with that,
but it has been done in other places in the world.
Is Enel supporting local business and suppliers?
Certainly, it is in Enel’s and the local economies’ best
interest to do so – a locally manufactured product
carries less issues from a logistics point of view. It makes
business sense, rather than getting components and
labour externally, we can positively contribute to the
empowering of the local community.
In terms of corporate social responsibility, what are
the focus areas for Enel?
Sustainable businesses create shared value. In its Strategy, Enel
addresses the UN Sustainable Development Goals – some
of which are education, healthcare, and access to electricity.
Overall, the Group is significantly growing its renewable
capacity, while gradually decommissioning its coal fleet.
_____
The Local Control
Room of Operation and
Maintenance South Africa
in Johannesburg allows
for real-time updates on
energy production, the
resources available and
any issues that require
attention. An intern
programme has been
running since 2017.
_____
William Price,
Country Manager of Enel
Green Power South Africa
www.opportunityonline.co.za | 35
in the atomosphere
2.6 TWh each year
o Enel Green Power:
ower.com
PROFILE
ENEL GREEN POWER
SOUTH AFRICA
As a global leader in renewable energy, Enel Green Power’s greatest mission is to
empower sustainable progress.
Global reach
Founded in December 2008 as part of Enel Group,
Enel Green Power develops and manages activities
for the generation of energy from renewable sources
worldwide. Enel Green Power is present in more than 30
countries on five continents with a managed capacity
of over 48GW and over 1 200 plants. The Group’s
production mix includes the main renewable sources:
wind, solar, hydroelectric and geothermal.
We are one of the world’s main renewable operators
with an annual production of about 82TWh, produced
mainly from water, sun, wind and heat from the earth.
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estimated at 100GW by 2030.
of energy from renewable Enel Green sources Power worldwide. South Africa Enel Green Power is present in 29 countries in five continents with a m
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main renewable operators with an annual production of a
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Stay Connected to Enel Green Power:
______________
ENEL GREEN POWER SOUTH AFRICA
Tel: +27 10 344 0200 | Wind General Projects email: communications.egprsa@enel.com
Solar Projects
Business development: egprsa.bd@enel.com 199MW
| 323.5MW Website: www.enelgreenpower.com
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TRANSPORT
Policy needs to match
infrastructure for
Africa’s trade to thrive
Hubs around ports and links to transport corridors will enable
the newly-minted African Continental Free Trade Area to
thrive, as a recent report by Dianna Games shows.
Credit: Transnet National Ports Authority
An extract focussing on transport and logistics from the discussion paper “The African Continental Free Trade
Area: A Pipe Dream or Silver Bullet?” by Dianna Games. First published by The Brenthurst Foundation, May 2021.
In May 2021, the bridge across the Zambezi River linking Botswana
and Zambia was opened by the presidents of the two countries.
The construction of the bridge, which replaces the longstanding,
slow ferry service across the river, means trucks on regional routes
can now cross the river in a few hours, or less, rather than the
previous three days to a week. It also means they can avoid using the
biggest crossing between the ports and factories of South Africa and
the rest of Southern Africa – Beit Bridge, which is also one of the most
congested borders in Africa. A one-stop border post at the bridge will
allow easier thoroughfare.
This project embodies the benefits that good infrastructure and
joined-up bureaucracy offer regional trade, both of them generally in
short supply. More than 250 trucks a day should be able to cross the
Zambezi instead of the handful that were able to cross before, bringing
down costs, increasing the security of cargo and providing an alternative
route for trade to the sea for inland markets.
Travelling by road across Africa can be a sobering experience,
characterised by delays, inefficiency and overzealous bureaucracy. There
are a range of literal and figurative potholes that are major constraints to
trade. Even as trucks battle with bad roads and congested border posts,
they also need to navigate a host of other issues such as roadblocks
designed mostly to extort money from drivers. Transport costs make
Africa one of the least competitive regions for exports and trade.
The continent’s import dependence and colonial trade patterns are
reflected in traffic movements – trucks laden with minerals and other raw
materials heading for the sea, returning either empty or loaded with imports.
This is the reality that faces Africa as it unrolls its flagship project, the
African Continental Free Trade Area (AfCFTA), which started trading under
the agreement in January 2021. The initiative brings together a potential
market of more than a billion people and has a lofty ambition of increasing
intra-African trade from under 20% currently to more than 30% in just a
few years by attracting investment into manufacturing, agriculture and
other sectors and building regional value chains.
What could go wrong?
The report details five areas where problems could arise. These are non-tariff
barriers; rules of origin; manufacturing and industrialisation; connectivity
and infrastructure deficits. This extract focusses on the final one.
Infrastructure deficits
Africa’s infrastructure backlog, regarded as the biggest constraint to
improving trade, is well known. The funding gap for addressing the
38 | www.opportunityonline.co.za
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TRANSPORT
Credit: Group Five
deficit is estimated at between $68bn and $108bn, says the African
Development Bank (AfDB). Factors affecting infrastructure rollout
include onerous lending processes by multilateral banks, poorly
prepared projects on the ground, a lack of sufficient off-takers and
commercial viability for lenders. China has stepped into the gap, with
the value of loans to Africa increasing from less than $1bn to more
than $30bn between 2000 and 2016. Although much of this funding
lacks transparency and is costly for African states, it is helping to fill
the gaps in areas such as roads, railways and airports.
Poor maintenance of existing infrastructure is proving to be costly with
colonial railways barely functioning in many countries and historical trade
routes suffering from years of under-investment and over-use.
Only 0.8-million of Sub-Saharan Africa’s 2.8-million kilometres of
roads are paved and only half of these roads are in good condition. The
roads are battered because dilapidated rail infrastructure has pushed
most of Africa’s trade onto these roads. Only 84% of the 82 000km rail
network is operational and most of these are low-speed, small-scale,
undercapitalised and poorly managed networks.
Up to 90% of Africa’s trade is conducted by sea but there are few deepwater
ports to handle large cargo volumes, resulting in long waiting times
for ships, which is compounded by limited berth and docking facilities,
weak terminal freight and handling management, and an oversupply of
government agencies that delay clearing processes. Few countries have
inter-modal infrastructure linking ports to road and rail infrastructure.
The African Development Bank maintains that transport costs alone
are 63% higher in Africa than in developed countries, with transport costs
representing between 30% and 50% of total export in value, which is
higher for the region’s 16 landlocked countries.
Energy deficits are also significant, with up to 70% of people in Sub-
Saharan Africa lacking reliable grid access. One-third of the continent’s
total installed capacity is in South Africa and yet it is suffering frequent
power outages as a result of under-investment and poor management
of its state-owned power utility. Renewable power is not yet being rolled
out at scale, with many governments reluctant to loosen regulation in
this key sector.
Border posts across the continent are a significant part of Africa’s
competitiveness challenge. The average waiting time for trucks
to cross borders with goods in Africa is 97 hours or four days.
Electronic pre-clearance procedures are often ignored by overzealous
border officials, who continue to search vehicles. Electronic
payment systems can be frustrated by poor Internet connectivity.
New systems and technology put in place by trade facilitators hardly
dent age-old ways of managing border crossings by officials on the
ground, even at one-stop border posts.
The busiest crossings are often the least efficient. These include Beit
Bridge, the gateway from South Africa to the region, Chirundu between
Zimbabwe and Zambia, and Kasembulesa, a chokepoint between Zambia
and the DRC. Efforts to upgrade infrastructure and processes have yielded
few improvements. The new Kazungula bridge offers logistics companies
options as do improving conditions in Beira and Dar es Salaam.
These factors go some way towards explaining why the cost of
moving a forty-foot (FEU) container from Beira to Lilongwe in Malawi
is about $4 750, including port and handling charges totalling $2 000
– nearly 10 times the cost through Antwerp, for example. The cost of
moving a container through Beira and on to Harare is $3 800, Beira-
Lusaka is $5 300, and Beira to the Congo a hefty $9 000. The comparative
cost of shipping an FEU 10 000km from Shanghai to Beira is $6 000.
+++
Choices: moving the afcfta forward
Given the realities on the ground described in this report, is it realistic
to expect the AfCFTA to be the game-changer that it is widely
expected to be? In a likely scenario of clear winners and losers, will
the free trade tide eventually lift all boats?
Given the complexity of existing trade arrangements, and the effort
to simultaneously simplify and expand them, a big task lies ahead.
The AfCFTA does provide a template for change, with a raft of support
structures and mechanisms to address problems of economic asymmetry,
trade disputes and issues of unfair trade practices, among others.
The odds are stacked against significant change, given the history. But
there are many reasons to be optimistic of incremental improvements.
For example, trade agreements can do more than lower tariffs and make
trade more efficient. They can improve transparency and create a legal
framework more hospitable to trade and investment from both within
and outside the region.
40 | www.opportunityonline.co.za
Geo Hydraulic and
Environmental Technology (Pty) Ltd
Specialists in groundwater and environmental services.
Credit: Luis Tosta on Unsplash
Supported by decades of experience in the industry
and in the fields of consulting and research, we are
committed to providing our clients with high-quality
and cost-effective solutions to their groundwater and
environmental challenges.
Our technical expertise is the basis of our pride in providing safe,
technically sound and environmentally sensitive services.
Our team combines geological, hydrogeological, geophysical
and hydrological skills, and our skilled operatives are ready and
able to meet our clients’ needs. Managing Director John Kalaka
Ngeleka has over 20 years of fieldwork and project management
experience in the research, mining and oil and gas sectors, firstly
as a geologist in the Democratic Republic of Congo and following
completion of his MSc in South Africa, as a hydrogeologist. He is
SACNASP (Water Resources Science) registered.
Geo Hydraulic and Environmental Technology (GET) specialises in:
• Groundwater development and supply, monitoring and
management
• Soil and groundwater risk assessment and management at
contaminated sites
• Geophysical investigations using imaging systems
• Numerical groundwater flow and transport modelling
• Basic assessment, scoping, Environmental Impact Assessment
(EIA) and Environmental Management Plan (EMP)
• Water-use licence and waste-management licence applications.
Vision
GET aims to actively support local and international communities in
maintaining and enjoying a safe and sustainable water provision and
limited human health-risk environment.
Mission
To provide clients with innovative, cost-effective and sustainable services
related to water and the environment. GET is committed to train young
professionals, advise government regulators and private companies
and organisations, and to provide technical skills and capabilities to
overcome water and environmental challenges.
Values
Employee and client safety, client satisfaction and innovative costreduction
skills.
Clients
Our clients include companies in the oil and gas, mining, agriculture,
manufacturing and construction industries, international and nongovernmental
organisations, government and municipalities. Current
clients include:
• Eskom, Two Rivers Platnium Mine
• Palabora Copper (Pty) Limited
• West Australia Drilling
• German Development Cooperation
• Institute of Natural Resources
Geo Hydraulic and Environmental Technology (GET)
25 Trichy Road, Raisethorpe, Pietermaritzburg 3201 | Tel: +27 (0) 33 391 0707 | Cell: +27 (0) 78 884 5263
Fax: +27 (0) 86 241 1879 | Email: info@get-sa.co.za | Director: johnkalala.ngeleka@get-sa.co.za | Website: www.get-sa.co.za
TRANSPORT
Listed below are a few recommendations that may assist in the
success of the initiative.
Political continuity. African business leaders have shown great
appetite for the AfCFTA but they need to remain committed to
its success.
Policy choices. There is no universal recipe for industrialisation. It will
require smart policy choices backed by supportive regulations and
frameworks – and may need a lighter bureaucratic touch than African
governments are willing to give. Africa’s internal trade is more diversified
and technology and manufacturing driven than its global trade, providing
a platform to build on.
Connectivity and corridors. This requires matching policy with
infrastructure and creating hubs around ports and linked to transport
corridors. As neighbouring markets grow interdependent, their
requirements are likely to improve export sophistication and develop
regional industrial clusters. This requires improved connectivity by road,
rail and air, to support growing demand.
Africa, while it also requires large infrastructure projects, also needs
to invest in joining up existing infrastructure – stretches of rail to each
other, roads to rail, bridges at strategic junctures and so on. Improving
Africa’s main trade highways should be a priority: removing roadblocks,
fixing roads, building supporting infrastructure and services along routes
and ensuring better management of border posts, with outputs closely
monitored.
Business climate. Improving the business climate is a critical element of
competitiveness and attracting investment. Governments need to build
meritocratic institutions that focus on reducing the cost of doing business.
The greater use of technology in improving trade and the capacity of
people to trade is critical, as well as a more decisive shift to e-government.
Keeping business on board.
Best – and worst – practice. Stakeholders need to look to success and
failure at home and elsewhere for how to change the trade trajectory.
Financing trade. The banking sector will play a vital role in supporting
the AfCFTA and Africa’s development generally.
Flag success stories. No matter how small, these may create momentum
and aspirational sentiment among businesses in Africa. The big success
stories may do the same, possibly prompting African governments to
analyse the constraints to their own success nationally, and possibly to
act on them.
About the author
Dianna Games is Chief Executive of Africa
@ Work, an advisory company focusing on
African business. She is a leading commentator
on business issues, trends and developments
in Africa and has travelled extensively around
the continent. She specialises in corporate
engagements across Africa and has done
research into regional economic developments,
corporate and government investment trends,
sector analysis for private clients and tracks
business developments in Africa’s key markets.
ADVISORY SERVICES
Understanding Government’s
Tendering Process
Tendering and procurement is a uniform process
and tender forms are standardised.
The tendering process in government is primarily
driven by instructions found in the Constitution and in
particular in Section 217, which prescribes that a tender
system must at all times be “Fair, equitable, transparent,
competitive and cost-effective”.
It further instructs government to create a “Framework”,
giving preference to historically disadvantaged individuals and
the Preferential Procurement Policy Framework Act (PPPFA) is
a response to that instruction. It introduces a preferential point
system, which is either the 80-20 equation for tenders with a
value of below R50-million or the 90-10 equation for tenders
with a value of above R50-million. The greater part of the point
systems is always afforded to the lowest-priced tender as a
maximum point, whereas the smaller part is allocated for B-BBEE
points, for each bidder.
The actual procurement process is either governed by the
Public Finance Management Act (PFMA) and Treasury Regulations
which is applicable to organs of state above local government,
or the Municipal Finance Management Act (MFMA) and Supply
Chain Management Regulations, which govern the process at local
authority level, which could be a municipality, a water board or
even a zoo or a museum.
Committee system
The regulations of the PFMA and MFMA prescribe a committee
system, which must be implemented to manage the whole of
the tender process. Committee members are appointed by the
Accounting Officer of the specific organ of state.
The first structure is the Bid Specifications Committee (BSC),
which is tasked with approving the actual requirement of the
goods and services as well as the stipulated specifications or
scope of works, depending on whether it is a tender for purchases
or works.
The next structure is the Bid Evaluation Committee (BEC), which
is tasked with conducting a technical evaluation on all valid,
Gerrit Davids
qualified and responsive tenders, either by using an “apples vs apples”
approach or applying the functionality methodology, which is a points
system requiring a minimum score that must be achieved by all bids
that have graduated to this stage of the process. Bidders will also be
afforded points for price and for B-BBEE.
The last structure of the system is the Bid Adjudication Committee
(BAC), which will consider a shortlist of potential bidders as compiled
by the BEC and has the authority to reject its recommendations, send
it back for review and where in agreement, select a recommended
bidder for consideration by the Accounting Officer, who will eventually
contract on behalf of the organ of state with the successful bidder.
According to Gerrit Davids, Lead Advisor at tendering agency
TaranisCo Advisory, Tendering and procurement within the
government sphere is a uniform process and tender forms are
standardised, as issued by National Treasury. Bidders should be aware
that, irrespective of where they tender, the process is exactly the
same for all organs of state.
“Also, as per the prescript in Section 217, bidders have a right to
access a decision made by any of these committees and they have a
constitutional right to object, lodge a dispute or an appeal, if they are
unhappy with such decisions,” says Davids.
TaranisCo Advisory CC
Mobile: +27 (0) 82 496 1657 | E-mail: gerrit@taranisco.co.za | Website: www.taranis.co.za
www.opportunityonline.co.za | 43
Rail regulator embracing change
A
strong brand is one of the
most valuable assets an
organisation owns. The
Railway Safety Regulator (RSR) has
undergone a major facelift with the
development and adoption of its
new corporate identity (CI). The new
CI was rolled out at the end of July.
Since its promulgation in 2002
and subsequent establishment
in 2005, the RSR has experienced
tremendous growth, becoming
a trusted safety authority in the
rail sector. The RSR is bigger and
better today, having expanded its
footprint to three regional offices
in the Western Cape, KwaZulu-Natal
and Gauteng, not with standing the
Head Office.
The evolution of the RSR’s CI
marks a significant milestone in the
Regulator’s journey to ensure that
“rail safety is on the right track”.
Gone is the sky-blue swoosh that
represented the old RSR; the new
look is adorned with a warm, vibrant,
bright orange that stands out just like
the organisation’s vision to promote
safe, reliable, and sustainable railway
operations recognised globally. It is
the same trusted Regulator, but with
a brand-new look, fresh, modern,
distinguished, and memorable. The
new RSR logo is an energetic and
timeless design which invokes joy,
dependability, and safety. Several
months were spent collaborating
with staff and a brand design agency
to redesign the RSR’s new look and
feel.
“This has been a very exciting
project which has involved
participation from various
stakeholders, both internally and
externally, to conceptualize and
develop possible logos and taglines.
Even though the logo is but one
element of the project, it is the most
important element by far. Therefore,
staff members as primary custodians
of the CI, were roped in to assist
by voting for their favourite logos,”
said Media and Communication
Executive, Madelein Williams. A
corporate video was also produced
with the help of staff members
who eagerly gave insight into
their areas of responsibility such as
inspections and audits led by the
RSR inspectorate teams across the
country.
In the next couple of months, the
new logo will feature prominently
in and around our buildings in
Midrand, Durban and Cape Town
including the RSR website . To follow
and keep track of this new and
exciting journey, follow us on our
website and social media platforms
on:
www.rsr.org.za
RailwaySafetyRegulator
@Rail_Safety
Railway Safety Regulator
Remember although we are
changing track, safety is still our
number one priority.
GOVERNANCE
Investments in estate properties
are proving their worth
A new review by New World Wealth selects 10 of the best lifestyle estates in
the world, with three South African estates listed. With increasing numbers
of South Africans choosing to invest in estate living, options that include
apartments, wildlife, eco-estates and retirement estates are proving popular.
Yellowstone Club in the US state of Montana nestles in the Rockies. Credit: Yellowstone Club
South Africans are continuing to choose estate living
in greater numbers. The main drivers for the increase
in the popularity of estate living in South Africa
are safety, shared facilities, communal parks and
controlled traffic flows.
This is according to Andrew Amoils, wealth analyst and head
of research at New World Wealth. New World Wealth has been
rating the top lifestyle estates in South Africa for the past five years
and has recently published a review in which it shares its top 10
lifestyles for 2021 from around the world. Both South Africa and the
United States secured three estates on the list, with estates in the
UAE, Mauritius, Italy and New Zealand also featuring in the top 10.
New World Wealth's top 10 lifestyle estate
picks for 2021are as follows:
• Yellowstone Club in USA.
• Val de Vie in South Africa.
• Bighorn Golf Estate in USA.
• Steyn City in South Africa.
• Kukio in Hawaii, USA.
• Fancourt in South Africa.
• Anahita in Mauritius.
• Jumeirah Golf Estate in the UAE.
• Jacks Point in New Zealand.
• Toscana Castelfalfi in Italy.
46 | www.opportunityonline.co.za
PROPERTY INVESTMENT
The top estates scored strongly in the following areas: appeal to high
net worth individuals (HNWIs), maintenance, communal areas (parks),
design, location, scenery, security and facilities.
A global trend
Estate living is already popular in USA, South Africa, Spain and Portugal
and is starting to take off globally, especially in the UAE, New Zealand
and Mauritius. Reasons for its rising appeal:
• Lifestyle and community: parks, playgrounds and schools.
• Facilities: in-house gyms, spas, golf, horse-riding, tennis and cycling.
• Limited and controlled traffic: safer for children.
• Security and privacy: access gate and private security personnel.
Kukio Golf and Beach Club is a gem on Hawaii’s Big Island.
_____________________
"Estate living is becoming
increasingly popular among
the world's HNWIs as they
search for more privacy and
safety," says Andrew.
____________________
Spotlight on the Yellowstone Club
The Yellowstone Club is one of the more impressive lifestyle estates
globally. It is situated in Big Sky, Montana (USA), and features a top
golf course and its own private ski slopes. The houses on the estate
start from a base price of around US$10-million, making it only
for the super-rich. The estate is set on 15 000 acres of mountain
wilderness with two large rivers that flow through the property.
Activities available on the estate include fly-fishing, golf, horseriding
and river-rafting during the summer and snowmobiling and
skiing for the winter.
There is also a move away from traditional golf estates towards
wildlife and eco-estates. Retirement estates (for over 60s) have
also become more popular.
Estate properties are good value as investments. As Andrew says,
“Over the past 20 years, estate properties have outperformed freestanding
homes in terms of price growth.”
With regard to the value of estate properties during a time of crisis (such
as the Covid-19 pandemic), Andrew makes the point that buyers seeking
open spaces are being attracted to estates with parks and wilderness.
“Many people have chosen to work remotely and live in smaller
towns,” reports Andrew. “For instance, a large number of people are
now working remotely from affluent small towns such as Hermanus,
Plettenberg Bay and Franschhoek. Lifestyle estates in these towns
have benefitted.”
About New World Wealth
New World Wealth has been tracking the spending habits of the
world’s wealthy for over seven years. The company’s research covers
90 countries and 150 cities worldwide. New World Wealth are the
researchers and authors of the Africa Wealth Report and the Global
Wealth Migration Review.
Website: www.newworldwealth.com
South African trends
South Africa is a global pioneer in estate living and is home to
many of the world's best lifestyle estates, including the likes
of: Val de Vie, Steyn City, Fancourt, Pezula, Steenberg, Arabella,
Atlantic Beach, Simbithi, Zimbali, Whale Rock Ridge, Leopard
Creek, Waterfall Equestrian Estate, De Zalze, Domaine des Anges
and Silverhurst Estate.
Buyers in SA are increasingly moving towards apartment
blocks or estates that have apartments. In line with this, most
new luxury developments in the country focus on apartment
living rather than houses; notable examples include: Brookfield
at Royal, Umhlanga Arch and Steyn City’s “104 on Creek”.
www.opportunityonline.co.za | 47
Steyn City offers a green lung in the heart of the big city.
Credit: Steyn City
PROPERTY
Delivering satisfying returns
Steyn City is proving a popular property investment.
Interest in gated communities and lifestyle
estates continues to rise. That’s not
surprising, given the drivers behind the
trend: for a start, security is a significant and
ongoing concern, with crime in the suburbs
showing no signs of abating. Added to this, many
South Africans are attracted to the idea of living
in a place that speaks directly to their interests,
such as golf, cycling or horse-riding.
Not all developments are equal, and even
those which boast of creating the consummate
“lifestyle” may be guilty of offering slightly
less than residents expect, either in terms of
accommodation which falls short of true luxury
standards, or limited amenities.
Wary of disappointing residents, Steyn City
Properties made every effort – from the time
of the development’s initial planning stages
in developing a masterplan – to ensure that
this was not the case. The result is a luxury
parkland residence which redefines lifestyle,
and in so doing, has ensured it is perfectly
matched with consumers’ current demands.
After all, location, location, location is no
longer seen as the most critical investment
criterion; it’s now the lifestyle available which
determines whether people are prepared to
invest, especially as remote working makes
it possible for investors to move away from
city centres.
Take the issue of security, for example.
Steyn City ensures complete peace of mind
with a highly advanced security system,
which includes a 24/7 security nerve centre
and round-the-clock patrols of the parkland.
Would-be buyers wondering about
investment value are reassured by
the developer's lifelong investment
in infrastructure. Indeed, all amenities
were developed by the time of launch,
so that buyers could experience the
reality they were purchasing, rather than
setting their hopes on a dream that may
fail to materialise. This approach means
that Steyn City is a low-risk investment
which has already delivered very
satisfying returns.
Many people living in developments
value the community which often arises.
The community feeling that pervades
throughout the parkland residence is
further enhanced by the existence of open
spaces and a lack of boundary walls where
residents get to know their neighbours.
The development’s culture is a contributing
factor. Steyn City was designed with an outdoororiented,
family-centred lifestyle in mind, so
that residents are able to access a broad array
of amenities, catering to a variety of interests,
without leaving the estate. Having these
facilities right outside one’s front door means
that a great deal of time is saved – especially
since AAA-grade offices and a world-class
educational campus (accommodating grades
000 to matric) are available on-site, too, with
the soon to be launched helistop presenting
the ultimate convenience for executives who
have little time to switch between venues.
Shorter commutes translate into less stress, and
a better overall lifestyle.
More than this, the variety of amenities – from
hundreds of kilometres for walking, jogging
or trail-running to a purpose-built mountainbike
track; from outdoor gym stations to an
18-hole Nicklaus design golf course; from an
indoor gym to an indoor aquatic centre and an
equestrian centre – means that residents can
access so many activities or leisure pursuits with
their added convenience.
The final drawcard is, of course, Steyn
City’s 2 000-acre indigenous parkland: a
back garden without compare for every
resident, offering space to roam and explore
with complete peace of mind. To feed the
connection with nature that forms the basis
for complete wellbeing is a different kind of
investment: an investment in the way you
choose to live your life.
www.steyncity.co.za
48 | www.opportunityonline.co.za
Experience limitless luxury
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why at the Namibian Ports Authority, our vision to be the best performing
seaports in Africa is embedded in our passion to drive our mission and
adhere to our values.
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