BEE has had positive outcomes - Gigaba

"To date, we have more companies with Black/African people that are listed in the JSE than we had 10 years ago, even though they are still not sufficient. The financial portfolio of assets for Black and African people has changed," Gigaba highlighted.

Gigaba was speaking during the Frank Dialogue on BEE held in Rosebank on Friday, where he maintained that the Broad-Based Black Economic Empowerment (BBBEE) strategy is a necessary intervention to address the systematic exclusion of the majority of South Africans from full participation in the economy.

He however, acknowledged that there is room for improvement as many African people participate in the financial system through savings accounts, stokvel or burial society, stressing a need to change from this in order to see a change in attitude from the financial industry.

"The binding constraints associated with transaction BEE is that many South Africans who had come through the systems have no experience in running business entities and have no entrepreneurship genes in them.

"This situation has a potential to derail the progress we have made in the economic front which is more visible in the mining sector and the most concentrated sectors of our economy like finance and retail sector," Gigaba noted.

He added that he has since instructed State-Owned Companies (SOCS) to enter into business transactions that change the character of the sector, because they understand that industry charters which allocated 26% ownership to Black and African people were a product of political compromise.

He pointed out that many SOCS have appointed black audit-firms as their external and internal service providers, with Transnet leading the way.

"At Eskom, we are working on a programme for Emerging Coal Miners that will change the empowerment game in the mining sector, which could to Eskom procuring 50%+1 of their coal from black miners by 2018 and the Competitive Supplier Development Programme is aimed at creating black industrialists who will become game changers in the field of black empowerment."

He said they have taken to heart the statement made by President Jacob Zuma in 2011 that the time had come for South Africa to make a decisive shift towards economic transformation in pursuit of socio-economic freedom.

"We understand that clarion call to mean that we must act decisively and conscientiously in order radically to ensure that the economy benefits the people in the areas that are still marginalised like the townships, informal settlements and rural areas.

"We must further evaluate the value these industry charters add in building sustainable economic development and growth. As a consequence of slow structural changes in our economy, we continue to perform below our full potential in terms of economic transformation," Gigaba said.