Jul 17, 2012
Poor service delivery crippling SA businessesBack
Natal|Education|Grant Thornton South Africa|Africa|Brazil|China|India|Russia|South Africa|Electricity|Eastern Cape|Western Cape|Deepak Nagar|Eastern Cape
© Reuse this
Poor government service delivery, including by utilities such as electricity; political uncertainty and crime were hindering business growth in South Africa, advisory services provider Grant Thornton said on Tuesday.
In its 'International Business Report' (IBR), the firm found that 59% of all South African business owners surveyed were negatively affected by poor government service delivery. This figure is up from 53% recorded in the first quarter of 2012.
Grant Thornton South Africa national chairperson Deepak Nagar urged businesses to work together with government to resolve service delivery concerns. “Corporations have an obligation to meet shareholder aims and stimulate economic growth. If they are unable to do this, the domino effect is insufficient employment opportunities, which ultimately results in an increase in crime,” he said.
Nagar added that only by addressing poor performance on service delivery concerns such as utilities, billing issues and roads directly with government, could business help to achieve the country’s goals of eliminating poverty and creating and reducing inequality.
Thirty-two per cent of private business owners identified poor service delivery relating to utilities (electricity and water) as having the greatest negative impact on their businesses, while 25% stated that billing issues (rates and taxes) were affecting operations.
Another macroeconomic factor impacting on South Africa’s privately held businesses is the issue of political uncertainly, Grant Thornton stated.
Its second-quarter data revealed that sentiment was improving marginally in this regard, with 29% of respondents indicating that uncertainty about the political direction of the country was impacting business decisions (down from 32% in 2011 – rolling average).
“This is probably in the hope of securing new business contracts by presenting improved empowerment credentials to prospective clientele.”
Every quarter, business owners are asked whether they or their immediate family or staff have been directly affected by a threat to personal security, such as housebreaking, violent crime, road rage and hijacking.
The IBR tracker revealed that 46% of privately held businesses have been negatively affected by crime over the past 12 months. This figure has dramatically declined from a reported 86% in 2007 when Grant Thornton first began to research this concern.
However, the survey highlights an increase of 7%, with 42% of business owners having been affected by crime in the first quarter of 2012, compared with 49% of business owners in the second quarter.
“We cannot accept such a high incidence of crime on our people. We need to do everything we can to eliminate this threat once and for all,” Nagar warned.
“Optimism is down worldwide compared to the first quarter of 2012 and also in comparison to prior years. It is clear that the economic crisis is still far from over. But business owners in South Africa and in the Bric economies seem, on the whole, to be a lot more optimistic about the economic conditions for the year ahead, when compared to the global average,” Nagar concluded.
Edited by: Mariaan Webb© Reuse this Comment Guidelines
Other Economy News
Updated 23 minutes ago Johannesburg-based locomotive solutions provider DCD Rolling Stock officially launched Phase 1 of its R240-million recapitalisation programme at its Boksburg manufacturing facility, last month.
Updated 23 minutes ago A financial and services management system, developed by enterprise resource giant SAP, enables rigorous financial management, process management and service delivery in small and large cities, says SAP Africa public sector head Alvin Paules. “The system, called...
Recent Research Reports
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
Road and Rail 2013: A review of South Africa's road and rail infrastructure (PDF Report)
Creamer Media’s Road and Rail 2013 Report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move...
Liquid Fuels 2013 (PDF Report)
Creamer Media’s 2013 Liquid Fuels report examines South Africa’s liquid fuels market, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing,...
Projects in Progress - Second Edition (PDF Report)
Creamer Media’s second Projects in Progress supplement considers some of the major project developments under way, including high-profile energy and transport projects, as well as a few of the lower-profile public and private developments. What remains apparent is...
Water 2013: A review of South Africa’s water sector (PDF Report)
Creamer Media’s Water 2013 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Canadian Mining Roundup for June 2013 (PDF Report)
The June 2013 roundup includes details of the development of TSX-V-listed Aldridge Minerals’ flagship Yenipazar polymetallic project, in Turkey; the Canadian Nuclear Safety Commission’s renewal of Cameco’s uranium mining licence pertaining to the Cigar Lake...
This Week's Magazine
Updated 33 minutes ago Johannesburg-based locomotive solutions provider DCD Rolling Stock officially launched Phase 1 of its R240-million recapitalisation programme at its Boksburg manufacturing facility, last month.
Updated 33 minutes ago Sales of electric cars should pick up once more such vehicles become available on the South African market, says Nissan South Africa (SA) chief marketing manager Ross Garvie. The local arm of the Japanese car company launched the country’s first fully electric...
Updated 33 minutes ago Denel Land Systems’ (DLS) Mechem division is successfully marketing the latest version of its highly regarded Casspir mine-protected vehicle, the Casspir NG2000 series wide body ambulance. As its description says, this has a notably wider body than standard...
Updated 33 minutes ago The infrastructure boom in Africa has seen investment in 322 megaprojects reach $222.7-billion, says professional services firm Deloitte in its ‘African Construction Trends’ report. Deloitte Southern Africa infrastructure and capital projects leader André Pottas...
Updated 33 minutes ago ASME, the international engineering profession’s cooperative, educational and training, research, outreach and codes and standards development organisation (originally the American Society for Mechanical Engineers, founded in 1880), is seeking to improve the...