Dear Editor
The Democratic Alliance (DA) notes that the Department of Trade, Industry and Competition (DTIC) intends to seek between R34 billion and R50 billion from the African Export-Import Bank (Afreximbank) to fund the so-called Transformation Fund.
We strongly oppose borrowing billions for yet another ANC-controlled fund.
It is clear that Minister Parks Tau does not believe businesses will pay into his proposed “voluntary levy” to fund his project, which would take 3% of their annual turnover. Instead of admitting defeat, he wants to borrow billions that ordinary taxpayers will be left to pay if the Fund’s loans fail.
Running a small business in South Africa is already very difficult, with high costs, red tape, and unreliable services. The chances that many of these loans will not be repaid are high. Borrowing billions for the Transformation Fund is therefore risky, irresponsible and could burden National Treasury with large contingent liabilities.
The purpose of borrowing from Afreximbank should be to strengthen South Africa’s exports, give local firms access to major projects, and grow the economy. Any money we borrow should fund catalytic export and infrastructure projects that create jobs and competitiveness, not the ANC’s ideological schemes.
The DA will continue to support measures that grow South Africa’s economy and create real opportunities for businesses. We will oppose any plan that risks taxpayers’ money on schemes that do not deliver results.
Regards
Toby Chance MP
DA Spokesperson on Trade, Industry & Competition