Change BEE, fix Johannesburg, and split Eskom into three units

Former Investec CEO Stephen Koseff said if he were president for a year, he would focus on fixing Johannesburg, splitting Eskom, and building private partnerships.

Koseff, one of South Africa’s most respected business leaders, shared his views on the Investec Minds podcast.

Equity research analyst Ross Krige asked Koseff what his two or three action items would be if he were South Africa’s President for a year.

He responded, saying that fixing Johannesburg, which is South Africa’s economic hub, is key to improving the country.

Another important intervention is unbundling Eskom into three separate entities: Generation, Transmission, and Distribution.

This, he said, should be done through public-private partnerships, which Investec suggested ten years ago.

“Eskom has done well through leadership changes. However, you now have to take the next step to avoid going back to where you came from,” he said.

Koseff said the public-private partnership should extend far beyond Eskom to improve the country’s infrastructure.

He cited the N4 toll road completed in 1996, which was a public-private partnership project between Investec and the government.

“We gave it back to the government after 30 years, who then re-tendered it and received another R10 billion. They did not have to pay a cent for this project,” he said.

“The N4 was also neat and tidy, and it always worked because the owners, Investec, had to look after it.”

Koseff is a big believer in public-private partnerships as the best way to improve the infrastructure in South Africa.

“I would try and devolve a hell of a lot of what government thinks they can do into the private sector through public-private partnership,” he said.

However, he warned that it has to be the right partners. “Selecting the right private partners is very important,” he said.

Koseff added that he would also modify the way black economic empowerment (BEE) works to focus on social upliftment.

“If the private sector puts effort into social upliftment, like giving people skills, creating opportunities, and building entrepreneurs, you can have a very transformative society,” he said.