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Speech by the Minister of Public Enterprises, Mr. Malusi Gigaba MP, at the launch of Broadband Infraco at Hyde Park, Johannesburg, on 18 November 2010

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Speech by the Minister of Public Enterprises, Mr. Malusi Gigaba MP, at the launch of Broadband Infraco at Hyde Park, Johannesburg, on 18 November 2010
18/11/2010
Programme Director,
Minister of Communications, Mr. Roy Padayachie,
Deputy Minister of Public Enterprises, Mr. Ben Martins,
Acting DG of Public Enterprises, Dr. Andrew Shaw,
Chairman of the Board of Broadband Infraco, Mr. Andrew Mthembu,
The CEO of IDC, Mr. Geoffrey Qhena,
Ladies and Gentlemen:
 
Firstly, I would like to extend my thanks to the Chairperson of Broadband Infraco, Mr. Andrew Mthembu, for inviting us to officially launch this exciting initiative.
 
Tonight is indeed an historic occasion for us as government and for many who have shared this vision that finally is being realized at this very moment, and particularly those that have applied their shoulders to wheel of this project since its inception.
 
Tonight, we acknowledge your efforts and thank you for your tireless work and unflinching commitment.
 
As you will all know, State-Owned Enterprises play a critical role in the delivery of services across all sectors of our economy. Government has provided a number of investments, through State Ownership Enterprises to ensure we fulfill the State’s wider developmental agenda of growing the economy, creating jobs, and fundamentally improve the lives of our people.
 
In essence, the commitment to construct an effective and efficient developmental state will be achieved in great measure through the better functioning of SOEs. It is precisely for this reason that we have to clarify the policy and strategy that would guide what we do – within given frameworks and processes – to realise the goal to ensure that the SOEs play a meaningful role within the broader government’s vision that has further been elaborated in the New Growth Path.
 
There can be no doubt that policy clarity as well as certainty are vital to the discharge of our mandate and responsibilities as a Department. As well as this, we need to:
·       Provide the most requisite strategic leadership to the department and the sector as a whole, especially to provide the vision and lead its pursuit, ensure to the best of our effort that we stabilise corporate governance and the managerial cadre, whilst easing the artificial and unnecessary tension between the pursuit of the broader developmental vision of the government and the narrow corporate interests of the organisations;
·       Improve our relations as well as communication with all the stakeholders; and
·       Try as best we can to ensure that the organisations we lead are run efficiently, effectively, in compliance with the corporate governance principles and are able to self-sustain.
 
The launch of Broadband Infraco, something I am very excited about, should also be seen in this context.
 
There are currently many South Africans without access to information and communications technology (ICT) infrastructure and services, particularly in the poorest and most often rural areas of our country. By deploying ICT infrastructure and services to these marginalised communities, Government can improve its machinery to deliver services cost-effectively and efficiently.
 
We can break the backward perception that the advancements of technology are in a monopolized niche market only to be enjoyed by the rich. We must shatter these misconceptions by ensuring that Infraco successfully realises the object of its creation, which was to provide cheap backbone network capacity to service providers, who in turn will compete for customers on the basis of prices and services.
 
Furthermore, the deployment of ICT infrastructure, and hence the launch of Broadband Infraco, enables Government to communicate effectively with citizens on products and services rendered, thereby stimulating economic activities throughout the country. Communication and acees to information, as well as development and the right to vote, are the backbone of a thriving democracy.
 
Amartya Sen, by the way, has provided – in his book Development as Freedom – a framework to the global human society on how we should understand and subsequently redress freedoms – he talks of freedoms from want, from tyranny, from hunger and so on.
 
Broadband Infraco is a necessary tool towards the realisation of these freedoms.
 
Since Government took a decision in 2006 to establish Broadband Infraco, a number of key developments have taken place in the ICT sector. The launch of the second network operator, Neotel, in 2007 has seen competition being introduced in the fixed-line market. Last year, a milestone was reached when the Independent Communications Authority of South African (ICASA) issued Broadband Infraco with an Electronic Communications Network Services (“ECNS”) license.
 
The rapid growth of the mobile sector has seen the launch of a fourth mobile operator to the market. The 2010 FIFA Soccer World CupTM has also left us with a legacy of world-class ICT infrastructure rivalling the best in the world.
 
It is clear that if South Africa should continue to play in the big league, including among the G20 as well as BRIC countries, we need to continue vastly to expand our ICT infrastructure and capability, indeed to carve a niche for ourselves in the knowledge and information economy.
 
Meanwhile, the international connectivity market has become highly competitive in a very short space of time. As most of you would know, the West African Cable System (WACS), in which Infraco is a participant, is under construction. Infraco will provide international connectivity to the west coast of Africa through its investment in the WACS project.
 
All these developments, combined with sweeping liberalisation measures, have changed the country’s ICT landscape – we can talk of real competition in the ICT market. The cost to communicate has dramatically reduced, although perhaps not yet at a point where we can celebrate. I know that working together with the Department of Communications we will persist with our effort further to reduce the cost of ICTs and telecommunications in this country.
 
The launch of Broadband Infraco today is further evidence of our commitment in this regard so that the majority of South Africans may have access to cheaper telecommunications and broadband services.
 
The Government, through Broadband Infraco, has invested millions in deploying approximately 12 125 km of National Long Distance fibre optic network that will provide higher capacity telecommunications services between all major national metropolitan centres, smaller cities/towns and rural areas.
 
As Government, our investment in Broadband Infraco will not only benefit the people of South Africa, but we have ensured that the ICT infrastructure deployed by this new SOE, benefits our neighbours and partners in the Southern African Development Community (SADC) as we gradually become interconnected African states who share the ultimate goal of continental development. Broadband Infraco will extend its National Long Distance services to international cables that land in South Africa, as well as providing regional connections in the SADC region.
 
Our partnership with the rest of the African continent is vital to ensure that through the deployment of ICT infrastructure, the continent’s aspiration of increasing intra-regional trade are realised.
 
However and most importantly, as part of Infraco’s statutory mandate and the requirements by ICASA, Broadband Infraco will be required to empower and provide universal access to previously disadvantaged areas. Infraco will be specifically required to provide wholesale backhaul connectivity to licensees operating in under-serviced areas.
 
 It is clear that in view of the high capacity connections required for the future, more needs to be done to improve the balance between fixed and mobile broadband connectivity. It is also clear that more needs to be done to improve PC and laptop penetration, in particular with regard to the affordability of these devices, as well as proper maintenance and electronic-security measures.
 
Globally, there are several initiatives focused on producing lower cost PCs, laptops and other devices, as well as lower cost operating systems and software, in order to reduce the total cost to the end user. Leveraging the benefits of these initiatives must also take a high priority in South Africa.
 
While our intentions and commitment to Infraco are unquestionable, we are mindful of the speed of the technological and industry changes that characterise the ICT sector, which requires a timeous turn-around time from all of us – the Board, the Executive and the Department as Shareholder representative on behalf of the State. 
 
Our shareholder compact with Broadband Infraco will ensure that it continues to operate efficiently and delivers on its mandate in support of Government’s economic and developmental objectives.
 
I would like to take this opportunity to thank the Board and Executive Management of Infraco for their commitment in seeing this SOE through from just an idea to a fully-established entity which is ready for market launch. I urge them to continue dynamically and not allow bureaucratic complacency to weigh on their initiatives and operations.
 
Needless to say, no SOE operates independently from the strategic direction of Government’s policies. We will continuously interact with the Board of Infraco to provide it with a vision and leadership.
 
I reiterate, as I conclude, that my department is committed and ready to render support to this undeviating Board and Executive Management as we forge a way forward towards our mandated destination. 
 
I thank you.
Page last modified:24/02/2014 14:12