Implementation of Vision 2020
Even before his enthronement as King of the Royal Bafokeng Nation, Kgosi Leruo Molotlegi set in motion the vital next phase in the development of his people. His brother, Kgosi Mollwane Lebone Boikanyo Molotlegi, paved the way for the initiative by proclaiming Vision 2020. This boldly challenges the Bafokeng people to reduce their dependency on their diminishing mineral assets and to become a self-sufficient community within the first 20 years of this century. Kgosi Leruo's challenge is to devise a workable plan to realize Vision 2020.
Until now, the Bafokeng have relied heavily on natural assets.
They originally settled in a valley that captured heavy overnight dew, holding the promise that the land would be fertile and that the community would prosper. They sweated to buy the land, repelling invaders and imperialists as they did so. They have had the extraordinary good fortune to see the discovery on their land of the world's largest deposits of platinum group metals. And they have wisely invested royalties and dividends from mining companies on their land to establish their own civic administration and social services.
Indeed, nature has been exceedingly generous to the Bafokeng, but, as they know only too well, the bounties of nature are not limitless. Even mineral deposits wrought by nature over 2 billion years are finite. Mined at today's rates of extraction, mineral reserves on Bafokeng land will last for another 35 or 40 years.
Measured against the millions of years it took for the minerals to form, this brief speck of time will soon be over.
Thus, the time has come for the Royal Bafokeng Nation, like the oil-rich Middle East, to reduce its dependency on natural resources and develop new sources of wealth. The Bafokeng, Kgosi Leruo concluded, had to diversify by securing interests in other sectors of the economy. They had to develop a more balanced portfolio, as it were.
For decades, mining royalties and dividends were invested in community development through a single agency: the Royal Bafokeng Administration (RBA) which was responsible for developing and maintaining infrastructure, and delivering social ser-vices. Clearly, if the Bafokeng were to broaden its interests, the community would need dedicated agencies to achieve its goals.
A full year before he was enthroned as king of the Bafokeng in August 2003, Kgosi Leruo Molotlegi established Royal Bafokeng Resources (RBR) to manage and expand the Nation's mining and related interests, and the Royal Bafokeng Economic Board (RBEB), now called the Local Economic Development Department, to facilitate development of entrepreneurship among his people. Royal Bafokeng Finance (RBF) was formed after his enthronement to develop non-mining holdings for the nation. RBR and RBF have merged to form Royal Bafokeng Holdings (RBH) and is based in Johannesburg.
RBA and LEDD are directly involved in community development, the former acting as a civil service, and the latter as a small to medium business development agency.
Wholly owned by the Royal Bafokeng Nation, RBH is an investment company responsible for growing and diversifying the community's assets and ensuring a steady flow of income to fund social development.
The establishment of RBH could not have come at a more opportune moment. It is at the right place at the right time, and with all the right credentials.
is well-capitalised, and it is wholly black-owned, making it an ideal partner for white-owned companies which must comply with legislation promoting black economic empowerment in South Africa.
These companies have to broaden their ownership base by including black shareholders, giving companies with black shareholdings preference in procurement of supplies and services, and ensuring advancement of black staff in the workplace.
As the first of the new agencies, RBH goes on the acquisition trail with an impressive current portfolio of assets: a 50/50 joint venture with Anglo Platinum in the Bafokeng Rasimone Platinum Mine situated on land owned by the Bafokeng and the mining house; a 1,5% holding in Impala Platinum which operates on Bafokeng land and pays the Royal Bafokeng Nation a 22% royalty; a majority, 33% holding in Merafe Resources, formerly SA Chrome & Alloys, which operates a chrome smelter in the Bafokeng area and the nearby Horizon chrome mine; and interests in granite mines on Bafokeng property.
Already, RBH's holding in Merafe is showing great promise. Merafe has formed a joint venture with multinational mining group Xstrata. This has created the world's largest ferrochrome producer and given RBR, through its holding in Merafe, a growing stake in the operation.
The company has also moved swiftly to develop interests in enterprises outside the mining sector. Its acquisition of a 20% stake in JSE Securities Exchange-listed plastics packaging group Astrapak represents the Royal Bafokeng Nation's first non-mining holding.
It has also ventured into the financial services arena by acquiring a 10% stake in SA Eagle Insurance Company Limited, South Africa's third largest short-term insurer.
RBH is leveraging its new partnerships to produce additional benefits, not only for the Bafokeng community, but also for neighbouring communities in North West province.
RBH, Astrapak and investment banker JP Morgan have pooled resources and supported the SA Institute of Entrepreneurs to train 700 teachers to take classes in basic business and economics skills in 80 North West schools, hopefully placing pupils in a better position to become entrepreneurs in a world where opportunities in formal employment are diminishing.
By investing in such groups as SA Eagle, RBH also hopes to create a platform for development of financial products tailored to the needs not only of the Bafokeng, but also of other small communities.
Meanwhile, LEDD aims to "lead the Bafokeng into becoming an economically self-sustaining community and one of the leading economically-active communities in South Africa.
Kgosi Leruo sees its role in particularly ambitious terms. He is of the view that in order to become prosperous, a community must produce one "world class" entrepreneur from every 20 of its members. With 300 000 Bafokeng living in South Africa - and half of them in the Bafokeng area - this means the community must strive to produce no fewer than 15 000 entrepreneurs. RBEB offers would-be entrepreneurs coaching, advisory services, mentoring, on-job training, and formal, in-class training. It has also facilitated the consolidation of numerous micro enterprises into a few sizeable companies, enabling them to compete for contracts in the Bafokeng area and further afield.
Development of enterprises has in part been spurred by the South African government's black economic empowerment policy. Thus, local entrepreneurs, supported by LEDD, have formed joint ventures with established companies to supply mines in the Bafokeng area. This has led to the establishment of locally-based companies specializing in such enterprises as drilling operations, manufacturing of overalls, and engineering. Thus, Kgosi Leruo Molotlegi is consolidating the gains his people have made over the centuries, establishing a broad base for them to grow and to realise the goals of Vision 2020 and beyond.