PIC angers Cosatu
Cosatu will step up pressure on the PIC to invest more aggressively in infrastructure and other projects to alleviate poverty.
|||Johannesburg - South Africa’s largest labor group said it will step up pressure on the Public Investment Corporation, which manages the pension funds of teachers, nurses and other state workers, to invest more aggressively in infrastructure and other projects to alleviate poverty.
“We are not happy, to put it bluntly, with the forms of investment of our pension funds,” Sdumo Dlamini, president of the 1.9-million member Congress of South African Trade Unions, said Thursday in an interview at Bloomberg’s Johannesburg office. “Cosatu has consistently been raising concerns about how pension funds or retirement funds of workers are invested. Why don’t we see our monies being invested in areas where jobs are seen to be created?”
The Pretoria-based PIC oversees about R1.8 trillion ($123 billion), making it the country’s largest investor. Its equity investments account for about 12 percent of the market capitalisation of the companies that trade on the Johannesburg Stock Exchange. The Johannesburg-based union federation’s demands that the fund manager play a more proactive role in addressing poverty come at a time when 27 percent of the workforce is unemployed and the economy is projected to grow at the slowest rate since a 2009 recession.
Projects linked to the government’s planned National Health Insurance, which could include building hospitals, is an example of the kind of investment plan Cosatu would support, Dlamini said.
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“Most of their investments are in malls,” he said. “Malls are simply perpetuating profiteering by business people.”
‘Exporting jobs’
Bheki Ntshalintshali, Cosatu’s general secretary, said in the same interview that there is a lack of transparency at the PIC and criticised the fund manager for investing outside of South Africa.
“When you invest offshore, in the language of workers that means you are exporting jobs,” he said.
Cosatu, which is in an alliance with the ruling African National Congress, plans to meet with PIC officials to try and persuade them to change their investment priorities and approach.
The PIC announced in May that it had set aside 70 billion rand to help foster growth and development, create jobs and give the black majority a bigger stake in Africa’s most-industrialised economy.
The PIC didn’t immediately respond to calls and an e-mail seeking comment.
BLOOMBERG