On 22 May 2014, Brian Molefe, Group Chief Executive Officer of Transnet Limited, delivered the following speech to USB-ED’s Executive Development Programme (EDP)
Hintsa ka Khawuta was the 4th leader of the Xhosa nation from 1820 until his death in 1835. He was murdered on the 12th of May in 1835 – so two weeks ago we honoured the 179th anniversary of his death. He was one of a number of Xhosa heroes who led the resistance against British encroachment into our territories. How he died is worth telling because, above all, it shows you how far we have come as a nation – and ultimately how far we need to go.
At the end of the Sixth Frontier War, during the treaty negotiations, despite being assured of his personal safety, he was held hostage by the British. On that day, Hintsa was riding as a prisoner in the company of British soldiers – led by the Governor of the Cape Colony, Sir Harry Smith, and a British officer, George Southey. Hintsa was being guarded on the ride back over the Kei and the Fish Rivers. Spotting an opportunity to escape, Hintsa spurred his horse forward and galloped away. Smith gave chase and twice tried to fire on the fleeing king. Twice his pistols malfunctioned but he caught Hintsa and pushed him off his horse. Hintsa got up and ran, still carrying his assegai. “Shoot, George, and be damned to you,” cried Smith to Southey. Southey fired and hit Hintsa in the leg but still he ran. Southey fired again. Hintsa was again hit but ran into a stream. “Be damned to you,” cried Smith to Southey, “Shoot again.” By this time Hintsa was in deep water and couldn’t stand properly. He threw his spear but it landed harmlessly near Southey, who took aim again. “Inceba,” cried the King in Xhosa. And again. “Inceba.”
But there was to be no mercy.
Southey, whose Xhosa was fluent, fired, and hit Hintsa in the head, killing him. Southey got to the body first and took off Hintsa’s brass body ornaments for himself. Others grabbed for his beads and bracelets. Southey or his brother William cut off one of Hintsa’s ears as a trophy and someone else cut off the other. A doctor travelling with them was seen trying to pull out some of Hintsa’s teeth. Later, even Smith could no longer bear the barbarity he had caused, and ordered Hintsa’s body to be dropped from his horse and to be left in the bush for his followers to find.
In March 1960, just after the Sharpeville massacre, someone else from the Cape wrote:Die kind is nie dood niedie kind lig sy vuiste teen sy moederwat Afrika skreeu skreeu die geur van vryheid en heidein die lokasies van die omsingelde hartDie kind lig sy vuiste teen sy vaderin die optog van die generasieswat Afrika skreeu skreeu die geurvan geregtigheid en bloedin die strate van sy gewapende trotsDie kind is nie dood nienòg by Langa nòg by Nyanganòg by Orlando nòg by Sharpvillenòg by die polisiestasie in Philippiwaar hy lê met ‘n koeël deur sy kop Die kind is die skaduwee van die soldateop wag met gewere sarasene en knuppelsdie kind is teenwoordig by alle vergaderings en wetgewingsdie kind loer deur die vensters van huise en in die harte van moedersdie kind wat net wou speel in die son by Nyanga is oralsdie kind wat ‘n man geword het trek deur die ganse Afrikadie kind wat ‘n reus geword het reis deur die hele wereldSonder ‘n pas
The person who wrote these moving (and prophetic) words was Ingrid Jonker, the Afrikaans poet. Her father, Abraham Jonker was a National Party member of parliament and he disowned his daughter for the words that she wrote. When she committed suicide in 1965, he declared that she was already dead to him.
Ladies and gentlemen, I mention these two vastly contrasting chronicles, because – whether we like it or not – these are the narratives of our country. Although from different vantage points, both Hintsa and Jonker had a vision for South Africa.
Today, we have the Ingrid Jonker Prize, which is a literary prize for the best debut work of Afrikaans or English poetry. We have the King Hintsa Bravery Award for leaders that live and act in the spirit of Hintsa ka Khawuta.
Our histories are intertwined – inextricably woven together for the greatness of our country. Since 1994 – twenty years ago – we have all been on that journey together as one nation – for better or for worse. We remain – tantalisingly – on the verge of achieving greatness. In 1994, we seized the opportunity to write a new volume in our history. We have made much progress in building a new democracy, in reshaping our economy and rebuilding our country, even though at times it may seem that we have not quite lived up to the expectations the world had for us in those early, heady days.
As a nation we have perhaps become cynical and jaded – but it is important to be mindful of where we came from – as these stories show us. In the early part of the last century – in 1906 – a South African was in the United States and receiving the George William Curtis Medal from the prestigious Columbia University – one of the oldest educational institutions in the US. It was the university’s highest honour for oratory. His name was Pixley ka Isaka Seme and was from KwaZulu – having been born at the Inanda Mission in 1881. He returned to South Africa in 1911 and was instrumental in forming the South African Native National Congress, which was later renamed the African National Congress. He was President of the ANC from 1930 to 1936. In his famous graduation speech he said: “Oh, for that historian who, with the open pen of truth, will bring to Africa’s claim the strength of written proof. He will tell of a nation whose onward tide was often swelled with tears, but in whose heart bondage has not quenched the fire of former years. He will write that in these later days when Earth’s noble ones are named, she has a roll of honor too, of whom she is not ashamed. The giant is awakening! From the four corners of the earth Africa’s sons, who have been proved through fire and sword, are marching to the future’s golden door bearing the records of deeds of valour done.”
Seme reminds us that the “historian with the open pen of truth” will one day pen our mistakes, prejudices, victories and defeats as a people. He was right – we see its unfolding before our eyes.
Our country and our continent have changed beyond recognition.
Those children that Ingrid Jonker wrote so poignantly about in the poem – those that got shot, those that were the dark shadows of the soldiers have become our leaders of today. They have grown up to trek through all of Africa, without a pass. They have taken giant steps into the world.
The 2014 Ernst & Young Africa Attractiveness Survey – which came out a few weeks ago, paints a fascinating picture of our continent – which affirms the prophetic views of both Pixley Seme and Ingrid Jonker.
The survey reveals a dramatic improvement in the continent’s potential, and how companies are successfully growing in Africa. The three crucial broad shifts that have been highlighted are interesting. They are:
- the growth of investment into sub-Saharan Africa
- the expansion of intra-African investment
- the shift of investment from extractive to consumer-facing sectors
The prime factors behind the sub-Saharan African growth story are strong macroeconomic growth and outlook, improving business environment, a rising consumer class, abundant natural resources, democratic dividend and infrastructure development. African investors nearly tripled their share of FDI projects over the last decade, and intra-African investment has also driven job creation on the continent. This growth is fuelled by the need for improved regional collaboration and strengthening regional integration.
With the diversification of economic activity in Africa gathering pace, growing employment levels are creating a new consumer class. This has paved the way for increasing FDI in consumer-focused services and manufacturing sectors. Sectors other than extractive industries are growing in importance. The most striking observation from this year’s survey is how far Africa’s perceived attractiveness has improved. In less than five years, Africa has risen to become the second most attractive investment destination in the world, tied with Asia. South Africa, Nigeria and Kenya are considered the most attractive investment destinations in sub-Saharan Africa. This bodes well for South African companies.
Indeed, our business leaders in South Africa are not waiting for surveys to tell them to go forth and be – as Jonker said – grown up to trek through all of Africa. Another dramatic shift in the survey shows the nature of our changing continent. Foreign direct investment in the technology, media and telecommunications sector was the highest of all FDI in Africa – at 20%. Metals and mining were at an all-time low of 2%. This is quite a change from the past – when Africa was just a repository for extractive resources. The others in the top four were:
- retail and consumer services,
A headline caught my eye just earlier this week. It said:Vodacom opens Congo floodgates
The article stated that the cellphone operator will scale up investments to double the number of subscribers in its largest untapped market, within five years. This is a massive market for Vodacom. It has the largest market slice – at 36% and 10 million customers.
In Nigeria, another South African cellphone operator MTN announced last week that it is to spend more than $3bn to upgrade and expand the infrastructure of its operations in Nigeria over the next three years. The company increased its subscribers to 57.2 million subscribers in Nigeria at the end of March this year. Its 49,3% market share makes MTN the largest operator in Africa’s largest economy, with a population of about 174 million. The company aims to push its subscriber base beyond 60 million this year with a target to sign up 5 million new users. Remember colleagues, our total population in South Africa is only 60 million!
Now is the time for South Africa to meet the challenges that will enable our country to engage in healthy trade with our regional and BRICS partners. Although the challenges are many, the most urgent for us are infrastructure, education and skills upliftment, and job creation. It is possible for us to realise our full potential – but only if we overcome these challenges. And we shall!
We must – as Pixley ka Isaka Seme said – awaken the giant in all of us. One way that the giant is indeed awakening in South Africa is in our dedication to infrastructure projects. Infrastructure is about nuts and bolts, girders and pylons, railway tracks and cement, and tough, rough, hard materials. It is also about tough, rough, hard issues. The question of who should pay for infrastructure investment remains a politically charged one. But there is no doubt that the investment has to be made.
As some of us may be aware, in April 2012, Transnet launched our rolling capital expenditure programme – the Market Demand Strategy (MDS). It is a R312 billion capital expenditure programme over seven years. The MDS is a revolutionary transition in the life of Transnet. It marks a definitive move to demonstrate the role that state-owned enterprises should play in the development of our economy. In helping to restructure our economy, the MDS will also significantly change Transnet. We are poised to become one of the world’s largest freight logistics groups and freight hubs.
The MDS is primarily intended to revamp and modernise our rail, port and pipeline infrastructure, of which Transnet is the custodian. In the short term, our infrastructure development plan aims to promote industrialisation of the economy by creating a market for locally manufactured components and jobs for local workers. In the long term, it will integrate our economy with those of our regional neighbours, creating inroads into larger markets and promoting regional trade and investment.
On the 17th of March this year Transnet made an announcement that shows that we are putting our money where our mouths are. We awarded one of the largest locomotive supply contracts in South Africa’s history. It is a R50 billion contract for the building of 1 064 locomotives to four global original equipment manufacturers. The contracts have been awarded to CSR Zhuzhou Electric Locomotive from China and Bombardier Transportation from Germany for the supply of electric locomotives, while General Electric of the USA and CNR Rolling Stock from China will build and supply diesel locomotives. This deal means that, in just under ten years, Transnet’s locomotive fleet will be entirely new. We want to assure all that the procurement process that Transnet followed complied with the highest standards of good governance. Every step was monitored and cleared by a firm of independent internal auditors. A committee of the board, made up of independent directors, oversaw the process from start to finish, asking all the difficult questions along the way.
They kept us honest.
We are proud to say that at the recent CFO awards in Johannesburg, our CFO Mr Anoj Singh, received two major awards. One was the Compliance & Governance Award and the other was the Public Finance Award of the year.
The locomotive transaction marks a significant milestone in the company’s history, and delivers substantial socioeconomic benefits for South Africa. The drive to modernise our fleet is intended to improve reliability and availability of locomotives. This will improve customer satisfaction, ultimately leading to our crucial goal of road-to-rail migration of cargo in line with government’s objectives.
You will be glad to know that the award has stringent local content, skills development and training commitments as dictated by the Supplier Development Programme. This is a government initiative whose main goal is to localise the production of imported machinery and equipment. In line with our commitment to boost South Africa’s manufacturing capacity, all the locomotives – except 70 – will be built at Transnet Engineering’s plants in Koedoespoort, Pretoria and in Bayhead, Durban – driving South Africa’s regional integration objectives. In total, the localisation elements are expected to contribute over R90 billion to the economy.
Transnet Engineering’s role in the agreement has been defined to ensure that it transforms into an original equipment manufacturer (OEM) over time, positioning it to become a premier supplier of locomotives, wagons and parts on this continent and beyond. This transaction is intended to transform the South African rail industry by growing existing small businesses and creating new ones. We are going to create and preserve approximately 30 000 jobs.
Investing in infrastructure development is about more than just catching up from historic underinvestment. In the short term, our projects aim to promote industrialisation of the economy by creating a market for locally manufactured components and jobs for local workers. In the long term, they will integrate our economy with those of our regional neighbours, creating inroads into larger markets and promoting regional trade and investment. In short, strategically planned and steadfastly maintained infrastructure creates fertile soil for diversified investment, supporting balanced economic growth and reducing the country’s reliance on raw materials. All these are preconditions if South Africa’s economy is to grow sustainably. Education and skills upliftment are the two elements that play a crucial role in reducing inequality in this country. South Africa has had to grow from the very low base of apartheid’s Bantu Education. Sadly, almost two decades after achieving freedom, we still have a long way to go before we can say that all our young people have access to effective schooling, a recognised tertiary education and meaningful skills upliftment.
It is common for people to say that we, as a country, don’t have the skills and manufacturing capacity we need to realise our development goals. There may be a grain of truth to this, but that is not where the story ends. A well-designed infrastructure project can be used as a lever to strengthen our skills pool here at home, while creating local economic opportunities. There is no reason why contracts originating in South Africa – whether these are state-run infrastructure projects or privately-run technology development projects – should be awarded to international companies in their entirety. With careful planning and negotiation, these contracts can easily be parcelled out so as to ensure inwards skills transfer.
Most state-owned enterprises invest heavily in education and training. This is a way for us to contribute to the government’s development objectives. It is also a way for such companies to ensure that they have the skills needed to grow sustainably. Private businesses are no different when it comes to needing a viable skills pool to meet their business’s future staffing needs. Bursaries, grants and learnerships are a powerful way to ensure that these needs are met. Even if bursary recipients don’t work at the sponsoring company for long, a vigorous and growing skills pool from which to draw employees only serves to strengthen an industry as a whole. It also sends a message to possible investors: We are capable. We have the smarts. Any investment is safe with us.
We have equal challenges with regard to employment in South Africa.
Our country enjoys a favourable demographic profile in that we have a large population of young people who are able and willing to work. If we can harness this workforce, our country’s productivity will skyrocket. Salaries are likely to increase, as will savings and investments. The economy will grow.
Promoting entrepreneurship is another vital cog in the employment-creation engine. Today, over 12 million South Africans rely directly on small business for their livelihood, and small businesses employ nearly 60 per cent of the country’s employable population. It might not be possible to ensure almost universal employment neatly on time by 2030, as envisaged by the National Development Plan, but that cannot discourage us from making every effort to put in place strategies, schemes and mechanisms to ensure that this becomes a reality as soon as possible. It will be a difficult, uphill struggle but we can succeed.
We will see Africa pulled out of poverty and drawn to glory, and this, I contend, is the historical responsibility of the generation in this room today. Wisely, Pixley saw this too all those years ago when he wrote:The brighter day is rising upon Africa. Already I seem to see her chains dissolved, her desert plains red with harvest, her Abyssinia and her Zululand the seats of science and religion, reflecting the glory of the rising sun from the spires of their churches and universities. Her Congo and her Gambia whitened with commerce, her crowded cities sending forth the hum of business, and all her sons employed in advancing the victories of peace – greater and more abiding than the spoils of war.
Overcoming these challenges has the power to profoundly change the human, emotional and physical landscape of South Africa. The environment they will create will provide us with a bedrock on which to stand and survey our achievements, take stock of our remaining challenges, and, beyond that, plot our way forward in the world economy. We have many hills to climb together – but if we focus and set aside our artificial differences we can achieve those goals. After all, we only have a very short time on this earth to make our mark. When the time comes to leave this earth, we must not be lonely and feel unwanted like the person in Pik Botha’s poem, Post Mortem. In it he laments:Ek vra nie om geprys te word nie,Ek sou nie gehaat wou wees nie,Maar kritiek, ja, ek kan dit vatEn my tekortkomingsGebreke en eiewaanKortsigtigheidEn my voortdurende verloëningVan wat ek voorstaanDit kan julle my laat drinkTot by die bitter droesemGeen rikriminasie of diskriminasie.Julle plig: om die lyk op te kerf enElke kiem van verderfOp te skryf op die voordoodse verslagGeen verdoeseling.Maar dan moet julle darem weetAl wat ek vra;Begrawe my vinnig soos ‘n ding wat stinkWat pes hetIn die aarde wat ek so lief hetWant dit was ook my landSuid Afrika.
And he continued to say in another poem titled Analfabeet:...Die spelfout op my grafklipMoet julle netso losAl sou die regmaak bra min kosWant julle wat my kenSal weetDat ek die kronologiese ordeVan die ABC verpes hetEn die voorgeskrewe spelling Van die lewe en die dood verwerp het.As the E&Y 2014 report shows us, Africa’s time is now. We, of this generation, do not have the luxury to despise the chronological order of the alphabet, or to reject the prescribed spelling of life and death. Ingrid Jonker and her father were worlds apart in their views. She died lonely and miserable. If we had to reimagine her words: The child did not dieThe child is not dead, The child will not die
I thank you. Brian Molefe is a South African businessman. He serves as Chief Executive Officer of Transnet.