Newsmaker – Philisiwe Mthethwa: The French connection

2013-08-04 14:00

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NEF chief Philisiwe Mthethwa says the Luminance storm boils down to racism

Look up the phrase très chic and you may just find a picture of Philisiwe Mthethwa. Clad in a grey Dolce & Gabbana power suit, hair up in a ponytail, impeccable minimal make-up, strong red lips – and did I mention the black nail polish? So on trend, according to style-casters.

Mthethwa has been under tremendous pressure this week to explain how the National Empowerment Fund (NEF), where she is CEO, lent media powerhouse Khanyi Dhlomo R34.1 million to start up Luminance, a luxury department store in Hyde Park.

It was launched with great fanfare and pomp until Mthethwa revealed the NEF loan – drawing gasps of disbelief from detractors.

One of their arguments was that Dhlomo, with her Harvard MBA, could have sourced money elsewhere. It was suggested that she used her personal and political connections to secure the loan, a claim Dhlomo has denied.

Mthethwa has become hardened after a series of interviews. She doesn’t even break a sweat as we spend an hour and a half discussing the matter.

“I’m excited,” she says. “Obviously the talk disturbs you a little bit or you are concerned by the comments people make, but I’m excited that we’re having this debate as a country.

“We interrogate the meaning of BEE because we’ve had these policies for a while and what this has done is to say for us, let’s regroup. Are we still aligned on what to do, is everybody on board?

“Somehow the NEF is to blame because it means we haven’t communicated our strategy very well to the public. And there’s also this misunderstanding about what broad-based black economic empowerment is.”

Mthethwa was born in Mahlabathini, and grew up in Ulundi and Pietermaritzburg.

She did a BA in economics at the University of the North and studied French for non-degree purposes out of curiosity, mostly following the influence of French nuns at Mariannhill College and Inkamana High in Vryheid.

She secured a scholarship to study applied microeconomics and finance in Vichy, France, then proceeded to the prestigious Sorbonne in the same country and on to the University of Sheffield for an MBA in corporate finance.

But the French spell was never broken. Her first job was for the Banque Nationale de Paris in London. She returned home in 1991. Her brother Sifiso Buthelezi had just been released from Robben Island and the pre-94 euphoria was in full swing.

She worked for Caltex Oil, moved to the Reserve Bank and later on to Standard Bank Corporate and Merchant Bank.

Then it was back to Paris, as the department of trade and industry’s representative, to lure foreign direct investment and exports from French companies.

In 2001 she returned to South Africa and then minister of public enterprises Alec Erwin roped her in to help write BEE policies.

“We started with nothing ... There would be gaps, but at least the country has a framework to deal with issues such as ownership, diversification and transformation.”

In 2005 she was appointed CEO of the NEF. Her French connection, meanwhile, yielded a Chevalier de la Légion d’honneur (a Knight of the National Order of Merit). This means she doesn’t require a visa to travel to France.

With this glowing CV, Mthethwa is not fazed by the hullabaloo over Luminance.

She says the emergence of the black middle class fuels the economic growth that has attracted luxury labels to these shores. She bemoans the fact that black women have not benefited enough.

“Last year, in a total portfolio of about R1 billion, only 20% went to female-owned enterprises. The NEF would like to do more for women, but if you don’t have a commercially viable proposition, you can’t just throw money at women.”

Away from the Luminance debacle, the NEF has invested R50 million in megamalls in Orange Farm and Umlazi, “invested on behalf of communities”, she says.

Mthethwa says this doesn’t mean they can’t tap into Sandton and Hyde Park.

“We need to have a balancing act between the risk of the mall in Umlazi and a store in Hyde Park.”

Mthethwa is proud of her clean track record in government, including an unqualified audit report for the NEF since 2005.

“What drives me as a person is that I am excited by people who are being empowered by the NEF. It becomes my personal victory.”

Responding to claims that Dhlomo is a friend of hers, Mthethwa shoots back: “I work with a lot of black professionals.

I met Khanyisile for the first time in Paris.We were not personal friends. Then she started the process of applying and we invited her to come and present. You end up developing a professional relationship with people you work with.

“I know some people will say Khanyisile was at my wedding (Mthethwa is married to Police Minister Nathi Mthethwa), but so was the CEO of Sanlam.

“I serve on the board of Sanlam; the chairperson of Sanlam was at my wedding. But if you were to ask me if they are my friends, I would say I have a professional rapport with them. The professional rapport I have with people can’t prevent them from applying for funding.

“But if you ask if I have ever been out for dinner or a cup of coffee with Khanyisile? No. Have I ever been to her house? I don’t even know where she lives.”

Mthethwa believes the social network and newspaper storm of the past week boils down to racism.

“One lady said I should support seamstresses instead. That’s derogatory, because what it says is that black people can only be involved in that segment of the economy.

“People should be aware that we gave Khanyisile an interest-bearing loan and she’s already started repaying it.”

Mthethwa has not bought anything at Luminance. “I get a lot of my outfits at sales. When they say less 30% or 40%, that’s when you see Philisiwe. I’ll go when they have a sale.”

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