EC launches parastatal to organise Asgisa investments
By MALUNGELO BOOI
and ROUX VAN ZYL
IN A shrewd move akin to that of the most hardened business tycoon, the Eastern Cape government yesterday launched the first ever parastatal tasked with managing Asgisa investments.
Asgisa Eastern Cape Pty Ltd will oversee the execution of two multibillion-rand mega-projects that aim to accelerate growth in the Eastern part of the province.
Eastern Cape Premier Nosimo Balindlela also announced Asgisa EC’s board, which includes high-flying black business people and is chaired by Saki Macozoma.
But although the province’s organised business chambers have welcomed the parastatal, they expressed concern over not being represented on the board.
Balindlela said Asgisa EC was kick-started with R300 million in funding that was transferred from the Transkei Development Reserve Fund to the province in 2003.
The funds will be augmented by national government as well as special provisions made by provincial government departments in the future.
She said Asgisa EC would focus on two mega projects in the Transkei, including the multibillion-rand Umzimvubu Basin Water Project which is expected to create 300000 jobs.
“It is aimed at facilitating and growing investment for Asgisa in the province, and to create a natural link between the booming first economy and developing the second economy,” said Balindlela.
The provincial government is the sole shareholder of the company.
“(Umzimvubu) will strengthen water security and electricity supply in the province and nationally,” Balindlela said.
The project would also be linked to an irrigation scheme covering a large section of the former Transkei, which would be used for grain production in summer and canola for bio-fuel production in winter, she said.
The other project the company would focus on was the province’s forestry and timber industry.
Nationwide, the timber industry has created 170000 employment opportunities and has contributed to the economy R16 billion annually and it is expected to play a similar role in the province, she said.
The two projects are expected to contribute to the development of Mthatha as a third major city in the province, after Coega Industrial Development Zone in Port Elizabeth and the East London IDZ.
“This will not only bring urbanisation to a largely rural area, but will also balance the economic scale of the province,” said Gloria Serobe, one of the board members.
The interim board that laid the ground for the formal establishment of the company was yesterday automatically dissolved with immediate effect as Balindlela announced the 15 new members of the board of directors for the company.
They included Gert Claasen, Nico Ferriera, Professor Nompumelelo Jafta, Saki Macozoma who will be the chairperson, Archie Nkonyeni, Andile Nkuhlu, Xola Phakathi, Gloria Serobe, Pepi Silinga, Sindy Zilwa, Zodwa Manase and Professor Wiseman Nkuhlu, while the MEC for Economic Affairs, Environment and Tourism, Mbulelo Sogoni, will be an ex-officio member.
Kevin Wakeford and Andrew Murray will act as technocrats.
The new board will be tasked with finding a chief executive officer.
Yesterday, organised business applauded the newly launched Asgisa EC, but had its doubts about the 15-person board tasked with steering the development organisation.
The concerns raised were that most of the board members were based outside the province or did not have the skills required by the original call for board member nominations.
These skills focused on the manufacturing, water and forestry sectors as well as geographic information systems. A third of the board consists of chartered accountants.
Nafcoc provincial president Thembelani Nodada said a strong board was needed to run the Asgisa projects in the province.
“There are high calibre people on the board. My concern is whether they can be effective if so many are outside the province. But that is not the real problem. If they understand the urgency of the (Asgisa) projects and show their commitment to the province I have no problem with them,” he said.
Nodada said the formation of Asgisa EC illustrated the government’s seriousness and commitment to develop the former Transkei.
Border-Kei Chamber of Business executive director Les Holbrook was disappointed that the board did not represent the province’s business chambers.
“It is a very powerful and prominent board. My concern is that so many of the people also serve on other boards in the province. They have also overlooked the province’s major chambers and the critical skills needed for Asgisa EC, like manufacturing, forestry, water and GIS,” Holbrook said.
Holbrook, however, called the formation of Asgisa EC a “shrewd” move as none of the other provinces have come up with their own Asgisa development vehicle.
“There is no question whether Asgisa EC is needed to develop the dilapidated northern part of the province. Our government has the money and for the second year in a row Minister Trevor Manuel has announced a budget surplus. Large capital investments (like Asgisa) are the quickest way to uplift people,” he said.