The Chief Executive Officer (CEO) of the Free State Black Business Chamber (FSBBC), Lucky Motsamai, tells OFM News presently businesses in the province are being held back by local municipalities’ financial dysfunction in two ways. The first is with respect to business opportunities that are not being availed by the municipality via supply chain to businesses in need; and the second is as a result of service delivery constraints such as poor infrastructure, water issues amongst others making it difficult to run a business effectively. Motsamai says it is critical for municipalities to start performing financially, to help businesses still in their infancy stage, to rebuild.

“This election is occurring against the backdrop of high unemployment, low growth, poverty, and a skewed economic structure. We really need this election to be one that actually delivers,” says Motsamai. The FSBBC CEO says that it is businesses that are less than five years into operation that are struggling most to get by presently.

The issue of poor service delivery and its impact on an area’s economy came under public scrutiny during Clover’s much-publicised exit from Lichtenburg to Queensburgh near Durban in KwaZulu-Natal, due to service delivery challenges on the part of the Ditsobotla Local Municipality. 

Agricultural economist at the North West University (NWU), Johnny van der Merwe, was one of many individuals who said Clover’s departure would not only lead to job creation and food security losses in the region, but stressed that this could mark the beginning of a mass exodus of more big name companies in the region due to service delivery challenges.

READ MORE: Clover NW's closure has knock-on effect

Clover defended their decision explaining that for years, the Lichtenburg factory had been experiencing water and power outages and the surrounding infrastructure had not been maintained by the municipality. They said despite numerous efforts to engage the municipality on these matters, the issues have not been resolved. The municipality refuted these assertions.

Clover later confirmed to OFM News that it was in the process of also closing down its factory in Frankfort, Free State, as well.

READ MORE: Closure of Clover's Frankfort factory yet to be finalised

OFM News