Mafia-style BEE ‘tenderpreneurs’ killing business with economic terrorism
The number of opportunists demanding a 30% stake in tenders won by established companies continues to grow unchecked
The new tendency of pseudo-entrepreneurs demanding a stake in public tenders won by companies poses a serious threat to the country and its economy.
A society’s descent into lawlessness does not happen overnight. It takes place over a number of months and years, often indirectly encouraged by authorities’ failure to take decisive, punitive action against those committing criminal acts. Inevitably, a society whose leaders tolerate — or conveniently turn a blind eye to — any form of criminality or malfeasance deteriorates over time into a state of utter anarchy.
SA is not there yet, but it could easily get there if the situation is not arrested speedily. Until recently, far too many people in this country got away with far too much. As has become evident from the various commissions of inquiry taking place, many among our political leaders and those connected to them have committed vile deeds with absolute impunity. They have looted with gay abandon and lived well beyond their legal means. They have turned public office and entities into their own private fiefdoms and milked them dry.
Among the consequences has been the rolling load-shedding visited upon us by Eskom, which has firmly consigned us to the status of a backward, third-world country. However, perhaps the most insidious consequence of the general criminality by some political mandarins has been the unwitting setting of a terrible example. The message that has been sent out is that it is fine — if not commendable — to cut corners, steal and generally break the law. After all, if putative leaders can shamelessly engage in such activities and get away with it, then by the same logic it must similarly be fine for ordinary citizens to do the same.
SA urgently needs a sustained crackdown on all forms of crime, from the most heinous to the apparently benign. That crackdown should focus as much on those in the private sector and ordinary individuals as it should on those in the public sector. We need a sustained effort aimed at inculcating a new culture of zero tolerance for crime.
While we welcome the good work done so far by the various commissions of inquiry established by President Cyril Ramaphosa, we wait with bated breath to see if widespread arrests, prosecutions and convictions — especially of prominent, high-profile individuals — will follow. Were that to happen consistently, it would go a long way towards sending a powerful message to all and sundry not only that corruption will not be tolerated during the “new dawn” era, such as it is, but also that the commission of a crime will inevitably lead to dire consequences for those involved.
Precisely because of the kind of example that has been set by SA’s political leaders and some of their reckless pronouncements on the economy, in recent years the business community has been on the receiving end of a sustained campaign to harass and intimidate it. A new breed of opportunists — some of whom call themselves entrepreneurs — has sprung up in different parts of the country to target the business community.
Routinely, they target companies that have won tenders from the public sector and demand 30% sub-contracting of the said business to them. They unleash violence to take over construction sites and prevent any work from taking place unless the companies yield to their vile blackmail. Often, this is in addition to members of the local communities demanding to be prioritised for employment on those projects, even if they do not have the requisite skills, experience or expertise.
This terrible culture is fast spreading to different parts of the country, in the process posing a serious threat to investment. Some companies are known to have packed their bags and walked away from tenders they had won, while others have reconsidered their investments in SA — at a time when the country desperately requires investment to grow the economy and create jobs.
Among the companies that have been affected by this scourge of lawlessness have been members of employer associations affiliated to the Steel and Engineering Industries Federation of Southern Africa (Seifsa). Many of them have laid charges against those involved in such acts of criminality and even obtained court interdicts, all to no avail. Others, on their own or in partnership with Seifsa, have registered their concerns with the various provincial governments and some national cabinet ministers.
This terrible culture is fast spreading to different parts of the country, in the process posing a serious threat to investment.
Regrettably, none of these efforts has so far yielded positive results. Precisely because of the aforementioned culture of impunity and the general inefficiency of our police service, the thugs — who often appear to be politically connected — have continued to harass, victimise and generally terrorise the business community. In a country in which “demand” is possibly the most popular word, where everybody — including students, local communities and workers — demands something from somebody else, often the government, these pseudo-entrepreneurs have also continued to demand, shamelessly, 30% of the value of others’ business opportunities.
We are not talking here about people who have sought to negotiate BEE partnerships with companies winning public tenders, or who could add some value to the companies thus cornered. Instead, these are men and women who are eager to muscle in because they can — and know that there is a high probability (if not certainty) that they will get away with it.
We in the metals and engineering sector join other sectors of the economy to call on the government and law-enforcement agencies to move swiftly to bring an end to these horrible acts of intimidation, violence and economic sabotage. We fully support and champion transformation, but will have no truck with economic terrorism.
Though we have previously raised our concerns on this matter in meetings with the relevant stakeholders, including with Ramaphosa and his ministers during the last CEO Initiative gathering at the Union Buildings in September 2018, we have not yet witnessed any change for the better. If anything, we have seen these acts of criminality spreading to more parts of the country and affecting even more of our members.
In the interest not only of our sector and the business community but also of SA itself, we call on Ramaphosa and all tiers of government to condemn this new tendency unequivocally and to urge compatriots to desist therefrom. And we call on the police and other law enforcement agencies to do their jobs.
• Nyatsumba is Seifsa CEO.