The role of state-owned enterprises in capacity building in South Africa from 1970 to 2012: a comparative case study

The building of a democratic developmental state has dominated discourse in South Africa recently, resulting in the establishment of the National Planning Commission that has adopted the National Development Plan 2030 as a blueprint for the country’s development plans. Acknowledging the strategic role that the state is set to play in building and enhancing the institutional and technical human capacity, this expectation has been compounded by challenges such as a lack of appropriate institutional capital, a human capital that lacks capacity, and relevant technical skills. These challenges have brought the discourse on the developmental role of State-Owned Enterprises (SOEs) to primacy. During Apartheid, the SOEs were utilised as tools that drove the country’s industrialization efforts. In South Africa, SOEs also stimulated economic activity in strategic sectors such as energy generation, synthetic fuel development, rail and road development and management. Fortunately, the political economy that guided the SOEs during Apartheid was developmental. The 21st Century developmental states such as South Africa have to contend with the reality that this century has ushered in a new frontier of opportunities and challenges. In this context, the SOEs should be viewed as fundamental pillars for the achievement of the national development agenda. A developmental state without the active participation of SOEs in innovation, research and development, building of institutional and technical capacity, building of economic infrastructure, it is bound not to succeed in its plans for national development. The 21st Century has ushered in a world anchored around information and communication and technological innovations, the SOEs should be at the cutting edge of technological innovation benefitting the country through its capacity building efforts. Consistent with the National Development Plan, a highly competent human capital ought to be developed over time. At the centre of National Development Plan 2030, should be the collaboration between educational institutions from the basic level to tertiary institutions with SOEs – this will sustain the country’s development plans in the long run