Business organisation Business Leadership South Africa's (BLSA's) member companies have suggested the development of a public accountability system that tracks and publishes progress on key initiatives, such as through a publicly accessible dashboard that could highlight the status of projects and government commitments, to boost delivery and implementation.

There is consensus on the need for greater transparency and accountability between the Department of Trade, Industry and Competition (dtic) and the private sector, says BLSA CEO Busi Mavuso.

“South Africa has for too long battled with low growth, high unemployment, widening inequality and poor and failing infrastructure. While impressive policies have been crafted to reignite the economy, all too often implementation has failed, thereby damning one of Africa’s largest and most industrialised economies.

“Business looks forward to an integrated and outcomes-based approach from the dtic, which can form a sturdy cornerstone of South Africa’s broader economic strategy,” she emphasises.

Business was encouraged by the commitment by new Trade, Industry and Competition Minister Parks Tau to engage the private sector in identifying priority areas to accelerate economic growth and implement coherent industrial policy.

“[The] BLSA welcomes the focus to create a more predictable and stable regulatory environment, clarify industrial policy and sector support, coordinate economic policy to enable more effective policy implementation, and ensure greater transparency between the dtic and the private sector,” Mavuso says.

For example, complex and inconsistent regulatory requirements deter business operations and foreign investment, while frequent changes in legislation increase the cost of doing business and the compliance burden.

“Streamlining regulations to ensure they are clear and consistent will go a long way to address this and, as has been suggested by some of our members, a one-stop regulatory body could be established to simplify compliance processes.”

Involving universities, and deploying AI and research capabilities, could assist with large-scale policy modernisation, she adds.

After entering office, Tau had reached out to the BLSA and its members, as well as others, requesting that they share high-level issues faced by big business.

“While the challenges and frustrations of businesses have been highlighted, it was encouraging to see the alignment on many common goals, including South Africa’s economic wellbeing, coming through in the Minister’s Budget Vote speech and those of his deputies,” she says.

Tau and his department's commitment builds on the successful collaboration to date and it fosters business confidence, which is one of the key ingredients needed to get South Africa’s economy growing again, Mavuso adds.

Further, in terms of industrial policy and sector support, it has been argued that the focus to date has been too broad, thus limiting effectiveness.

“It makes sense, therefore, to concentrate on fewer sector priorities and revitalise the Industrial Policy Action Plans, or the masterplans, for targeted sectors, starting with the green economy.”

However, in the process of revitalising the sector masterplans, the focus should be on designing the framework to be adaptable to allow for ongoing monitoring and course correction as conditions change, as sector masterplans are often complex industrial and trade strategies, she emphasises.

“The masterplan approach has the potential to be an effective industrial policy tool, but its success depends on addressing the challenges identified around evidence-based decision-making, balancing objectives, resourcing and cross-stakeholder alignment.”

Securing alignment and buy-in for the masterplans across different government agencies and the broader business community will be key, she notes.

Additionally, harmonising policies between departments and sectors would establish regulatory certainty as a key element of South Africa’s value proposition to global investors and trading partners.

The dtic could lead this process as part of the Invest SA mandate, and as an implementation thrust of the draft Country Investment Strategy, she proposes.

“One specific area of focus for the department is to facilitate cross-government or cross-industry collaboration to lower perceived sovereign lending risk to South African projects.

“Another area of focus should be constructive, growth-accelerating approaches on empowerment standards and practices for foreign direct investment in priority sectors. Similarly, the uncertainty around masterplans and their interaction with other national instruments must also be addressed,” she says.

POLICY COORDINATION

Meanwhile, the BLSA has previously highlighted the need for greater economic policy coordination.

Several issues have been widely acknowledged as causing unnecessary friction and increasing the cost of doing business in South Africa, notes Mavuso.

These include, among others, exchange control regulations, crime, skills shortages, unnecessary regulatory red tape, the need to broaden Internet connectivity and the well-documented challenges related to energy security, reliable electricity and water supply, and the ports, rail networks and logistics hubs.

“While many of these issues engage with mandates of other government departments, the work of the dtic has wide influence, impacting about one-in-eight formal private sector jobs in the country.

“The department also plays a critical role in promoting investment, facilitating trade, stimulating industry, and supporting global competitiveness and inclusive growth.

“We would argue that there is logic in the dtic leading a whole-of-government approach to these matters as the lead interface with industry and organised business,” Mavuso says.

The private sector has skills, experience and the will to work with the government and civil society to fix blockages and help ensure delivery, she adds.

“What matters now is pragmatism, undertaking research, testing new ideas, and embracing the course of action that will best deliver for the country to foster confidence, which will lead to investment and expanded economic activity.”