8 June 2018

South Africa: Minister Zweli Mkhize Calls On Business Sector to Review Investment Pattern

press release

CoGTA Minister Zweli Mkhize has called on business sector to review their investment pattern to create centres of economic activities in rural and small towns, most of which do not have revenue base and are dysfunctional by structural design. Minister Mkhize was speaking at the Sanlam Senior Leadership Conference held to mark the company's 100th birthday at the Cape Town International Convention Centre today (08 June 2018).

Minister Mkhize reflected on the highlights of government's past achievements and current challenges which he said challenges government, business sector and civil organisations to re-define their relationship and use the lessons to move the country forward.

" All stakeholders must rally together as South Africans to seize the opportunity provided by the political new dawn to grow the economy of our country and use the past challenges as our strength and resilience towards a common future," said Minister Mkhize.

Minister's engagement today was part of CoGTA's on-going outreach to business sector, various professionals and other stakeholders to support the ministry's interventions to turn around dysfunctional municipalities across the country.

The recent CoGTA assessment of municipalities - as part of the Back to Basics programme - indicates that most of them struggle and nor do they have required skills to plan, deliver, operate and maintain municipal service delivery infrastructure. The same assessments have also revealed that:

only 7% of the country's municipalities are well-functioning;

31% are reasonable functioning;

31% are almost dysfunctional; and

31% are completely dysfunctional.

Addressing the Sanlam conference today, Minister Mkhize said while CoGTA was attending to most challenges facing municipalities - such as fighting corruption, political infighting, hiring of qualified professionals and financial management - business sector must support government through their investment which must be beyond Corporate Social Investment (CSI) to achieve inclusive growth.

"Local government is everybody's business, the business sector needs to realise that the growth of their businesses somehow depends on the well-functioning of municipalities and serious engagements must take place where government has a shortfall," said Minister Mkhize.

Minister said while the results of the current CoGTA interventions may take longer, the involvement of all stakeholders was important to ensure that distressed municipalities get access to needed support for the good of all stakeholders.

Issued by: Department of Cooperative Governance

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