SA Airways has been thrown multiple lifelines over the past decade. Among others, the Development Bank of Southern Africa also stepped in.
Section 4 of the Act lays out the various powers that have been conferred upon the DBSA. What is of relevance here is subsection , which states that the DBSA shall have the power “to lend or advance money to any person or private or public body engaged in or proposing to engage in development projects and programmes in the region…”.
The issue at play here is what qualifies as “economic development”. Even though the phrase is used five times throughout the 1997 Act, and four times throughout the, both of the Acts fail to define precisely what is meant by economic development. One would think such a definition would be too important to omit, seeing as the whole purpose of the DBSA is “economic development”. Alas, the legislature failed to recognise and acknowledge the importance of definition.
The Act also does not set out clear criteria according to which possible projects must be evaluated, to determine whether they are consonant with the objective of economic development.
This is not the first time bank officials have attempted to use this ambiguity to justify them going against their investment mandate. Zodwa Mbele, group executive for transacting, stated in anwith Radio 702 that the reason funding was extended to SAA is that the DBSA’s mandate obliges it to “look into economic development...”told parliament’s select committee on financeon Feb.