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This report focuses on developments in State-Owned Corporations (SOCs), also known as State-Owned Enterprises (SOEs), which according to the National Treasury had assets of R1,225.2bn in the 2016/17 financial year. The most recent Presidential Review Report indicated that there are more than 700 SOCs, including provincial and municipal entities and 172 national government entities.
SOCs are established primarily to provide public goods and services and to play a developmental role in society. The importance of these entities being run ethically and efficiently is underlined by the crucial role that they play in sectors such as energy, transport, logistics and arms manufacturing. In South Africa, however, the larger South African SOCs have been accused of participating in large-scale corruption, which has been termed ‘state capture’ over the last few years. In 2017 parliament hosted an inquiry into the state capture of Eskom, Transnet and Denel and a Commission of Inquiry into general state capture, headed by Deputy Chief Justice Ray Zondo, has since been commissioned.
The report on South African SOCs focuses on current conditions, highlighting underperforming entities, governance failures and the possibility of privatisation in the SOC sector. The report profiles 24 of the major SOCs, including South African Airways (SAA) which during 2017 was recapitalised to the tune of R13.7bn, and the South African Post Office (SAPO) which received R3.7bn from government. Also profiled is the Development Bank of Southern Africa t/a DBSA, which seeks to "accelerate sustainable socio-economic development and improve the quality of life of the people of the Southern African Development Community (SADC) by driving financial and non-financial investments in the social and economic infrastructure sector.”