Backgorund to SOEs in SA PDF

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Background of SOEs in South Africa...

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1. Background to State-Owned Enterprises in South Africa 1.1 Definition of State-Owned Enterprises in South Africa State-owned enterprises are “independent bodies partially or wholly owned by government. They perform specific functions and operate in accordance with a particular Act.” (Ovens & Associates, 2013) State- Owned Enterprises in South Africa strive to create job opportunity, increase skill levels and encourage growth in the economy. The most well-known State-Owned Enterprises in the country are Transnet, Eskom and South African Airlines – these enterprises play a major role in transforming the South African economy and developing the country in a variety of areas. 1.2 History and past performance of State-Owned Enterprises in South Africa During the twentieth century, the South African economy was mostly structured around the discovery and processing of diamonds, gold and various other minerals. The industries developed, due to these resources discovered, were State-Owned Enterprises (Ritchken, 2014). Numerous job opportunities were created through the trading of minerals as the procedure of processing these minerals require various different industries to be involved. However, the large majority of State-Owned Enterprises in South Africa were developed during and shortly after the apartheid period as most international counties had embargoed South Africa due to the policy of apartheid. Thus, South Africa had to develop and increase the goods and services available within the country as surrounding countries would no longer trade with South Africa. Owing to the expansion of local industries State-Owned Enterprises were developed. Once apartheid had concluded Stat-Owned Enterprises played a key role in creating job opportunities for those who were disadvantaged during the period of apartheid (Ovens & Associates, 2013). 1.3 Current performance of State-Owned Enterprises in South Africa The current performances of State-Owned Enterprises in South Africa initiate growth and advancement within the economy, by means of the development of vital infrastructure and the increase of employment. Such as the South African State-Owned Enterprise Sasol, which has generated 31270 employment opportunities worldwide. The Sasol employees become equipped with a variety of skills and valuable knowledge (Sasol, 2019). Sasol alone has positively impacted the growth of the South African economy through job creation leading to reduce unemployment and developing connections between South Africa and the other economies that Sasol are involved with. The greater part of South African State-Owned

Enterprises is in need of a remodel as numerous matters of corruption have occurred, in the higher levels of authority, which affects the stability of the enterprise directly. Ovens, W. & Associates. 2013. The role and significance of state-owned enterprises, public entities and other public bodies in the promotion of urban growth and development in south africa [Online]. Available: http://www.cogta.gov.za/cgta_2016/wp-content/uploads/2016/05/iudf-state-ownedenteprises.pdf [2019, May 2]. Sasol. 2019. Company overview [Online]. Available: https://www.sasol.com/about-sasol/overview-0 [2019, May 3]. Ritchken, E. 2014. The evolution of state-owned enterprises in south africa [Online]. Available: https://www.oecd.org/daf/ca/Workshop_StateOwnedEnterprisesDevelopmentProcess_SouthAfrica. pdf [2019, May 3]....