Mzansi Looks to China for State-owned Enterprise Reform Lessons
Minister in the Presidency for Planning, Monitoring and Evaluation, Maropene Ramokgopa is leading a government delegation to China this week, seeking insights into successful state-owned enterprise (SOE) management as South Africa grapples with its own failing public corporations.
The five-day visit, running from October 28 to November 1, comes at a crucial time as South Africa advances its National State Enterprises Bill, aimed at overhauling the country’s troubled SOE sector.
South Africa’s state enterprises, including power utility Eskom and transport giant Transnet, have been plagued by operational inefficiencies, corruption scandals, and mounting debt. Eskom’s inability to provide reliable electricity has led to devastating nationwide blackouts, while Transnet’s port and rail challenges have cost the economy billions in lost export revenue.
The delegation will meet with China’s State-owned Assets Supervision and Administration Commission (SASAC) and the China Enterprise Reform and Development Research Society.
They will also conduct site visits to Chinese state enterprises, which have generally demonstrated stronger financial performance than their South African counterparts.
The visit aligns with agreements made at the 2024 Forum on China-Africa Cooperation Summit (FOCAC), focusing on strengthening state governance and sharing best practices.
South Africa’s SOE reform is becoming increasingly urgent as:
- Eskom’s debt and infrastructure woes have ballooned to hundreds of billions of Rands
- Transnet’s inefficiencies have created major export bottlenecks
- South African Airways has required repeated government bailouts
- Denel, the arms manufacturer, has struggled to pay worker salaries
- The Post Office has faced near-collapse
The new National State Enterprises Bill represents South Africa’s most ambitious attempt yet to restructure these vital institutions and implement stronger governance measures.
The government hopes that learning from China’s experience in SOE management could help guide this critical reform process.