2 years ago

Opportunity Issue 98

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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).


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 .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 |

Delivering high-quality services and products Mamonkwe Trading goes beyond expectations. CONSTRUCTION Mamonkwe Trading is a supplier of topquality products and services within the industries of logistics, plant hire and projects, contract mining and mining services. With specialised skills in these sectors, we offer the right solution at a compatible price. 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 Is to be a leading corporation that provides a diversified service offering in the various fields such as distribution, logistics and equipment supply in South Africa. Through tireless provision of high-quality products and services, we will ultimately grow our business into our neighbouring countries and beyond. Heavy-duty equipment We offer high-quality heavy-duty machinery: • Compaction equipment • Demolition equipment • Drill rigs and rock drills • Moving equipment • Crushing and screening (bulk material handling) • Generators and lighting tower plants Transport We specialise in the transportation of aggregates, earthmoving equipment and access equipment. Our services We have a diversified service offering which is provided to various industries such as the energy industry, the mining industry, the logistics industry, earth moving, rehabilitation and the construction industry. Earth moving Plant hire, construction, transportation, excavation, crushing, screen plant and dry bulk material handling. Civil construction • Mining and mining reclamations • General building • Mass excavating • Conveyor-belt maintenance • Bulk water supply and dam cleaning • Shaft plugs • Shaft demolition • Concrete works and road works • Rehabilitations Our team Mamonkwe Trading is a young, dynamic and adventurous company that was established by young professionals who saw an opportunity to establish a company that will empower young professionals while contributing to the economy. We encourage the idea and fundamental purpose of black empowerment in the new era of entrepreneurship. The main goal of Mamonkwe Trading is empowerment and contribution to the economy of South Africa and also to the global economy in the transportation/logistics, mining and plant-hiring industries with a new dynamic way of doing business. We have over 10 years of collective experience and skills in leadership and senior management positions, in both small and large businesses, and are therefore geared to tackle the transportation/ logistics, mining and plant-hiring industries head on. Mamonkwe Trading CC Address: Portion 54-55, Winkelhaak Farm, Evander | Tel: 017 200 2018 } Fax: 086 591 5155 | Email: | Website: | 29

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