Last week produced plenty of evidence that reform is moving forward. Business confidence is a long way behind. That gap is a measure of how much still has to happen before reform turns into a real improvement in the operating environment.

National treasury, through the Development Bank of Southern Africa, has issued a call for proposals for advisers on the unbundling of Eskom’s transmission assets into an independent transmission system operator (ITSO). It is a significant step. The transaction is complex — it will require the approval of Eskom’s lenders — but such restructurings have been concluded successfully in many countries, and there is substantial international experience to draw on. I am confident treasury will secure the right expertise.

The timetable set out in the request for proposals is ambitious: the transaction must be concluded within the next 18 months. I have been calling for some time for swift implementation of the unbundling plan, which forms part of the wider electricity restructuring programme that is now settled policy. It will be highly positive if this timetable can be met.

The plan has faced resistance in some quarters, but I believe the key role players are now aligned on seeing it implemented. A week ago I met Eskom chairman Mteto Nyati and group CEO Dan Marokane to discuss our positions on the unbundling. Both BLSA and Eskom fully support the electricity reform programme, as set out in a joint statement after our engagement.

The process can now accelerate. I know Eskom’s lenders are willing to engage to find workable solutions. Treasury’s advisers will have an important role in aligning those role players and designing a transaction that works for everyone. BLSA will play its part in supporting all of them to achieve that outcome. It is critical to establishing the foundations of growth in our economy.

Growth enablers

There was also an update last week on the rail network statement, the document that sets out how private operators can access the national rail network. It matters for the logistics reform process and has the potential to unlock billions of rand in new investment in rolling stock and rail infrastructure. The department of transport now says it will publish the final version at the end of September. That is behind schedule, but a high-quality network statement that works is better than meeting a deadline with one that does not.

Logistics and electricity are growth enablers. They are the preconditions for the investment that will drive growth towards our 3%-plus target, and for the job creation that would follow.

A memorandum of understanding was signed between the India Commonwealth Trade Council and the India South Africa Chamber of Commerce. Improved trade relations matter a great deal for the business outlook. I wrote last week about the absence of a coherent trade strategy for South Africa. India is an example of a far more coherent one: it has 14 signed free trade agreements, against the six or seven agreements and customs union arrangements we have, and six preferential trade agreements where we have just one. We have had a long stop-start engagement with India on trade opportunities, and perhaps this agreement will support progress towards a mutually beneficial outcome.

There was also the two-year extension of the African Growth and Opportunity Act, which now runs to the end of 2028. The access it provides is partly compromised by US President Donald Trump’s tariffs, but it does positively affect some of the product lines we export to the United States. The extension is welcome, but it is too short to shift investment in South Africa materially, which would require much longer visibility.

The author, Business Leadership South Africa CEO Busi Mavuso

These positive signals stood in contrast with the business confidence numbers released in the same week. The RMB/BER business confidence index fell a point to 38 in the third quarter, a level that indicates generally negative sentiment, with 62% of respondents dissatisfied with prevailing business conditions. It is well down on the 47 recorded in the first quarter.

That tells us businesses are not yet feeling the impact of reform on the ground. The progress we saw last week is important — these are steps towards an operating environment in which electricity is priced through competitive markets and logistics services can be accessed through multiple operators. But sentiment will only respond once we have fully functioning, competitive markets for electricity and logistics. When companies start to see input costs falling and service reliability improving, they build confidence. That is the goal, and we must not slow down before we get there.