Steuart Pennington: What the 130 CEO Pledge has achieved so far

In a recent newsletter, President Ramaphosa lauds the strides made in the unprecedented partnership between government and business, highlighting substantial achievements in addressing critical economic challenges. Spearheaded by influential CEOs like Mxolisi Mgojo, this collaboration has slashed load shedding, boosted electricity generation, and curbed criminal incidents, among other milestones. With trust deepening and concrete progress evident, the nation braces for further transformative endeavours in energy, transport, and combating corruption.

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By Steuart Pennington

“The remarkable progress made in the partnership between government and business over the last nine months shows just how much we can get done when we work together,” says President Ramaphosa in his March 11 weekly newsletter.

Really?

So what has been achieved? I spoke to Mxolisi Mgojo, previous CEO of Exxaro and one of the CEO sponsors of Business for South Africa’s (B4SA’s) Transport and Logistics Focal Area which works closely with government and Transnet within the National Logistics Crisis Committee (NLCC) to address the country’s logistics challenges.

Business and Government set up this partnership nine months ago to address three key economic challenges: energy, transport and logistics and crime and corruption. Since the partnership began, the infographic below details the progress.

More than 130 CEOs of the country’s leading companies have pledged their support.

Since November 2023, load shedding is 61% lower than the same period a year ago.

Electricity generation capacity from different sources has increased by up to 10,600 MW, which will enable a significant reduction in the severity of load shedding by the end of this year.

Under the leadership of its new Group CEO, Eskom is finalising an agreement with business to deploy additional independent skilled experts to support Eskom.

Transnet has achieved a 45% reduction in vessels anchored outside the Port of Durban and a 36% reduction in the waiting time to anchor for container vessels.

There has been a 65% reduction in criminal incidents on the Northern Corridor, reducing the number of trains cancelled.

Support has also been provided to modernise the 10111 helpline, with a pilot project initiated at the main call centre in Midrand, and the establishment with the Hawks of a forensics analysis centre

Investigating Directorate is being established as a permanent entity, including a dedicated forensics laboratory. A key focus of the partnership is to secure South Africa’s removal from the Financial Action Task Force grey list by at least June 2025

Transnet is now forecasting volumes of greater than 151-million tons for the 2023/24 financial year, rather than the 142-million tons outlined in October.

Two new executives, Michelle Phillips and Russell Baatjies, have recently been confirmed as the permanent CEOs of Transnet and TFR respectively, bringing stability and focused direction to the SOE.

Private sector technical expertise has been engaged and these experts have been seconded to work within Transnet and Eskom to provide critical support to senior executives.

Mxolisi concludes, in the NLCC we have 5 priorities:

Advancing the Economic Regulation of Transport Bill to implementation, I am optimistic that President Ramaphosa will sign off soon on the legislation passed by Parliament on February 29;

Improving security on key corridors transporting coal and chrome;

Implementing the Freight Logistics Roadmap, which includes plans for third-party access to the rail network and the splitting of TFR into the Transnet Rail Infrastructure Manager and the Transnet Freight Rail Operating Company;

Expediting the Private Sector Participation framework across ports and rail; and

Addressing the remaining procurement issues, relating largely to critical spares.

Mxolisi stressed that the continued poor operational performance and inefficiencies at Transnetcontinued to cost the economy R1-billion a day, which he said underlined the urgency of both the recovery plan and the associated reforms.

TRUST – A PROCESS of FAIR EXCHANGE

Two things happen when parties/people “build relationships”, the first is the goals and success measures they set for themselves, their achievements. Clearly observers, the media and interested parties will measure success based on these outcomes only.

The second and more important issue is the relationship dynamic, the ability of the parties to get to know each other, to understand each other, to converse with each other, to share with each other, to make concessions, in a manner which results in a fair exchange where both parties have equal skin in the game. This is how trust develops, this is how futures are built. Generally, observers don’t measure this.

Hopefully the list of achievements as listed above will continue to grow, but more profoundly government and the Private sector, with the involvement of Civil society will all feel that their skin in the game is understood and respected and that there is a growing process of genuine fair exchange.

Early days, but hopeful. I hope to report on progress in all three areas; transport and logistics, crime and corruption; and energy supply regularly.