NICO PIENAAR: Ekandustria is a case study in government failure

The Mpumalanga Economic Growth Agency (Mega) was created with the stated mission of promoting trade and investment in the province. Yet instead of being a catalyst for economic growth, it has become one of the biggest obstacles to it.

Its latest failure has left more than 40 factories in the Ekandustria Industrial Park in Bronkhorspruit, Gauteng, without power due to an unpaid R300m debt to the City of Tshwane.

Once a bustling hub of manufacturing, Ekandustria employed more than 30,000 people just a decade ago. Today, under Mega’s mismanagement, it struggles to sustain just more than 1,000 jobs, with businesses crippled by constant water and electricity cuts.

This is not just an administrative blunder; it is economic sabotage. The consequences are dire, not just for businesses but for thousands of workers who depend on these jobs to feed their families.

This chaos is the result of an ongoing power struggle between the national and provincial governments. Under current legislation provincial governments control the daily operations of industrial parks, while the department of trade, industry and competition is responsible for overall oversight.

The result? A constant battle for control over taxpayer funds, leading to paralysis, inefficiency and ultimately economic collapse.

Most state-owned economic agencies are nothing more than patronage networks, enriching the politically connected at the expense of economic development. Mega is a textbook example of this dysfunction.

Despite a formal intergovernmental relations agreement signed between the national government and the department to oversee Ekandustria’s revival, Mega completely ignored the agreement. Instead, it continued to mismanage the park, failing to pay its debts while forcing businesses to bear the brunt of its incompetence.

But business owners are not backing down. The Ekandustria Industrial Association (EIA) has called for independence from Mega, arguing that businesses themselves can manage the park far more efficiently than the provincial government of Mpumalanga. This call must be supported if we want to see change.

Industrial parks in collapse

Ekandustria is not an isolated case — industrial parks across the country are in a state of disrepair. Many of them are crumbling due to neglect, with no maintenance or infrastructure investment, or taken over by unregulated rent collectors, with businesses being extorted by individuals falsely claiming to represent government.

It is painfully clear that the government cannot run industrial parks effectively. If SA wants to revitalise its manufacturing sector, create jobs and attract investment, we must move towards a public-private partnership model. We need to do the following:

• Privatise the management of industrial parks, allowing businesses to take the lead.
• Limit the government’s role to oversight, ensuring accountability without interfering in daily operations.
• Ensure a business-friendly regulatory environment, where industry can thrive without political interference.

The solution is simple: allow business to be business and government to be government. SA will never achieve re-industrialisation, economic recovery or job creation while industrial parks remain in the hands of failing provincial governments.

The DA will continue to fight for policy reform that puts business, investment and job creation first and not ANC-aligned agencies that have failed time and time again.

• Pienaar, a DA MP, is a member of the National Council of Provinces select committee on economic development and trade.