An address by the outgoing Chairman of SAPIA
Founding the South African Petroleum Industry Association (SAPIA) is just one sign of the profound change that has taken place in our country. SAPIA has existed for a period shorter than the presidency of Nelson Mandela. In that brief period the nation has seen reform in every sphere of life, in a process unmatched in the world today.
The changes have been social, political and, yes, spiritual, but not yet noticeably of material benefit to the people as a whole. Nor has there yet been sufficient change in the structure or state of the economy. This change is essential since the history of every nation shows us that it is the strength of its economy on which a nation's health and existence depends.
In modern times production and trade are the only sources of national wealth. Governments receive income only by taxing the value added by this economic activity. A nation's other sources of funds - loans and foreign aid - are not true income. It is vital that governments nurture successful business sectors and encourage local and foreign investment.
SAPIA sees the new imperatives which must drive the national interest to be:
The petroleum industry is one of the largest investors in the national infrastructure, and SAPIA's members, between them, are the most extensive and long-standing foreign investors in this country.
It is acknowledged by all that the petroleum industry plays a vital and fundamental role in any economy. In South Africa we accept our responsibility to provide our burgeoning economy with cost-effective sources of energy. However, we are still burdened with many of the restrictions, which have their genesis in the siege economy and sanctions of the past. Drastic measures were imposed which were not based on sound economic principles.
Today, in returning to normality, we must rid ourselves of past fears and past prejudices. Where there was fear we must now go forward in confidence. Where there was compulsion, there should be free enterprise. Where there was control and secrecy, there must now be transparency and openness.
Founding SAPIA is an outward sign of the conscious shift by the petroleum companies to create open debate and a frank forum. The Association's core purpose is to ensure transparency and the open good governance of the industry, which is a cornerstone of the national economy. SAPIA members strive at all times to meet the highest standards of environmental responsibility, industrial safety, development of human resources, business practices and ethics, and involvement in the community.
Despite the necessary global structuring of the petroleum industry, SAPIA members are very much a part of this country. We are very much a part of the exciting transformation of our nation and its economy. We are of course deeply and directly involved in the search for consensus between business, labour, government and other stakeholders on how our vital industry should transform to best serve the interests of all South Africans.
SAPIA has presented to Government and other stakeholders what it believes to be pragmatic solutions to work toward, which should ensure increasing efficiency, competition and benefits for everybody. We want South Africa to take its place as soon as possible among the "winning nations", and our solutions involve actions that must be taken by the petroleum industry as a whole, and of course by Government in its policies.
Some of our solutions are tough on our industry, but these are part of a consistent blueprint which we believe should benefit the nation as a whole. Our proposed new structure of the industry is designed to deliver:
As I said, much of South Africa's economy still has to change to meet our goals. Yet effective reform of the economy would not be possible without changes already occurring in the rest of our lives - changes in values, in priorities, in perspectives and perceptions.
In the past it seemed that the untrammeled pursuit of State interests represented itself as the common interest. Now we can pursue, openly and honestly, the common interest. Freedom requires more than the absence of repression. It requires co-operation and concessions, and it requires accountability. We are re-learning these values in South Africa. We are also discovering new perspectives and new perceptions.
We hope that South Africans are now coming to understand that the "J.R. Ewing" image of the petroleum industry is no more true than the fiction of lions in Eloff Street. As the petroleum industry enters the 21st century, it stands in a global fish-tank in which all its actions and all its endeavours are visible to all interested. This is particularly so of its performance on environmental and safety issues.
Social investment and development programmes have long been part of our members' competitive edge, as is their practice of conducting business with integrity and good governance.
I would like to express my thanks to my fellow Governors for their assistance and support during my term of office. We all manage companies which compete fiercely with each other on all fronts every day. It requires a special commitment and discipline to come together to make progress on the matters of critical importance and national interest we deal with at SAPIA.