asgisa ec strategic review 2009
DESCRIPTION
Includes an overview of the process and recommendations of the Eastern Cape's special purpose vehicle for rural development which initially focuses on the former Transkei and more specifically, MzimvubuTRANSCRIPT
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AsgiSA-EC:
Strategy review workshop report (Final draft)
1�October�2009
Advisory
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1©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Disclaimer
Disclaimer
This�report�has�been�prepared�by�KPMG�Services�(Pty)�Ltd�(“KPMG”)�exclusively�for�the�benefit,�information�and�internal�use�of�AsgiSA-EC�for�the�exclusive�purposes�of/in�order�to�update�the�five-year�organisational�strategy�and�business�
plan�under�the�terms�of�the�engagement�letter�dated�31�August�2009,�and�neither�this�report�nor�its�content�thereof�may�be�used�for�any�other�purposes�without�KPMG’s�prior�written�consent.
All�information�utilised�to�develop�this�report�is�assumed�to�be correct�and�complete.�The�role�of�KPMG�has�been�to�facilitate�the�strategy�review�session�without�providing�technical�input�into�the�strategy�and�proposals/recommendations�
emanating�from�this�session.��As�such,�this�report�shall�not�in�any�way�constitute�advice�or�recommendations�regarding�whether�or�not�AsgiSA-EC�should�proceed�with�the�proposals/recommendations�associated�with�this�report.
This�report�may�not�be�copied,�published,�quoted,�referred�to�or disclosed�by�AsgiSA-EC�to�any�other�third�party,�without�KPMG’s�prior�written�consent.�No�party,�other�than�AsgiSA-EC,�may�rely�on�this�report,�either�in�whole�or�in�part.�
KPMG�and/or�KPMG�Inc,�including�its�directors,�employees�and�agents,�and�any�body�or�entity�controlled�by�or�owned�by�or�associated�with�KPMG�or�KPMG�Inc�(collectively�“KPMG”)�accepts�no�liability�or�responsibility�whatsoever,�
resulting�directly�or�indirectly�from�the�disclosure�or�referral of�this�report�to�any�third�party�and/or�the�reliance�of�any�third�party�upon�this�report�or�the�contents�thereof,�either�in�whole�or�in�part�and�AsgiSA-EC�agrees�to�indemnify�and�
hold�KPMG�harmless�in�this�regard�from�and�against�any�and�all�claims�from�any�person�or�party�whatsoever,�expenses,�liability,�loss�or�damages�arising�from�or�in�connection�thereto.
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2©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
E.��Detailed�workshop�programme
D.��Where�are�we�– CEO�presentation�(Simpiwe�Somdyala�– AsgiSA-EC)
C.��Mzimvubu�Water�Resource�Development�(Ingerop Agrica)
B.��Eastern�Cape�Rural�Development�Strategy�– implications�for�AsgiSA-EC�(Zolile
Ntshona – EC�SECC)
A.��Provincial�Agriculture�and�Rural�Development�Strategic�Perspective�(Thandi�Mbete
– EC�DARD)
Presentations – Appendices
10Working group feedback
4Background
35Way forward and next steps
3Executive summary
6Workshop approach
Pg.
Contents
The�contacts�at�KPMG�
in�connection�with�this�
report�is:
Gary SimmsDirector
Tel: 043�721�0893
Fax: 043�721�0886�
Mobile:�082�469�5403
Gugu NxiweniAssociate Director
Tel:���041�395�1500
Fax:��041�395�1700�
Mobile:�071�749�4499
Disclaimer
All�information�utilised�to�develop�this�report�is�assumed�to�be correct�and�complete.�The�role�of�KPMG�has�been�to�facilitate�the�strategy�review�session�without�providing�technical�input�into�the�
strategy�and�proposals/recommendations�emanating�from�this�session.
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3©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Executive Summary
Introduction
This�report�summarises�the�input�received�from�participants�and�recommended�proposals�
to�the�AsgiSA-EC�Board�of�Directors�(herein�after�referred�to�as�“AsgiSA-EC�BoD”)�
emanating�from�the�AsgiSA-EC�strategic�workshop�held�at�the�Fish�River�Sun�on�the�13th�
and�14th�August�2009.
This�strategic�review�session�was�mainly�driven�by�need�to�review�and�update�the�
organisational�strategy�following�government’s�redefined�priorities�and�renewed�focus�on�
rural�development.��As�part�of�the�ongoing�strategy�review�processes,�this�session�was�
also�held�in�a�view�to�share�lessons�learnt�from�first�year�of�operation,�ensure�ongoing�
stakeholder�dialogue�on�the�strategic�direction�of�the�organisation.
The�strategy�session�provided�delegates�with�the�opportunity�to�discuss�the�strategies�that�
AsgiSA-EC�would�employ�and�to�address�the�need�to�continue�focusing�its efforts�on�areas�
that�have�potential�to�impact�positively�on�the�lives�of�the�rural�communities�by�increasing�
their�economic�participation,�creating�sustainable�jobs�and�improving�their�incomes,�thereby�
directly�improving�rural�livelihoods.
Delegates�were�divided�into�four�groups,�each�tasked�to�discuss�a�specific�topic�as�
depicted�in�the�table�below:
Emerging strategy considerations
The�key�strategic�issues�emerging�from�the�session�and�the�working�groups,�which�should�
emanate�in�the�development�of�detailed�proposals�to�the�AsgiSA-EC�BoD,�are�included�in�
the�table�that�follows.
Strategic�location�and�organisational�capacityWorking�group�4
Stakeholder�mobilisation�and�institutional�capacityWorking�group�3
High�Impact�Priority�Programmes�(HIPPs)�and�project�enablersWorking�group�2
Funding�models�and�resource�mobilisationWorking�group�1
Working group focusWorking group
Rural Development Agency
With�government�proposing�the�formation�of�a�Rural�Development�Agency�(RDA),�there�was�a�proposal�that�AsgiSA-EC�
and�ECRFC,�whose�mandates�are�more�aligned�to�each�other,�merge�to�form�the�core�of�the�Rural�Development�Agency.��
Whilst�it�was�acknowledge�that�there�was�an�existing�cabinet�resolution�for�AsgiSA-EC�to�be�a�subsidiary�of�ECDC,�it�was�
felt�that�the�wider�mandate�of�ECDC�could�result�in�AsgiSA-EC�losing�focus.
Niche focus
It�was�proposed�that�the�niche�focus�of�AsgiSA-EC�is�to�play�a�catalytic�and�supportive�role�in�rural�economic�
development�within�the�Eastern�Cape.�AsgiSA-EC�must�play�a�niche�role,�distinctive�of�other�organisations�(direct)�but�
also�provide�support�to�existing�organisations�where�necessary�(indirect).
Facilitate implementation of HIPPs
The�role�of�AsgiSA-EC�going�forward�was�proposed�to�be�centred�on�facilitating�the�implementation�of�the�identified�
HIPPs�and�projects.�In�order�to�make�this�possible,�AsgiSA-EC�would�need�to�narrow�and�specify�their�role�within�each�of�
the�HIPP.
Building local institutional capacity
At�the�centre�of�the�AsgiSA-EC�model�should�be�the�mobilisation�and�building�of�local�institutional�capacity.
Nodal and cluster approach
This�approach�was�recommended�as�the�proposed�approach�towards�the�implementation�of�AsgiSA-EC’s�rural�
development�mandate.��The�nodal�approach�focuses�on�ensuring�high�impact�in�identified�“nodal” areas�with�the�
village(s)�being�the�nucleus�of�a�particular�node.�The�cluster�approach�focuses�on�ensuring�high�impact�across�a�number�
of�nodes.
Geographic focus
Although�the�initial�focus�was�historically�viewed�as�the�Mzimvubu Development�Zone,�there�was�a�view�that�this�should�
be�amended�to�cover�the�Eastern�Cape�with�a�focus�on�the�previous�Transkei�homeland�and�the�rural�areas�therein.
Partnership-leverage implementation model
This�model�would�entail�strategic�partnerships�with�other�entities�and�the�different�spheres�of�government,�to�ensure�that�
the�organisation�focuses�on�leveraging�off�these�partnerships�and�not�“re-invent�the�wheel” or�duplicating�effort.��AsgiSA-
EC�would�also�need�to�ensure�alignment�with�both�provincial�and�national�government�programmes�relating�to�rural�
development.
“Special” Fund for rural development
AsgiSA-EC�should�establish�and�administer�a�“Special” fund�which�would�focus�on�co-ordinating�rural�development�
funding�from�private�sector�corporate�social�investments,�donors and�donor�agencies,�development�funding�institutions,�
etc.�
Key strategic proposals/recommendations
Emerging strategy considerations (continued)
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4©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Background
This�section�briefly�highlights�the�background�to�the�strategy�review�
session
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5©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Background
Introduction
AsgiSA-EC’s�strategy�workshop�was�held�at�the�Fish�River�Sun�from�13�to�14 August�2009.�
The�event�is�used�as�a�platform�to�in�assisting�you�with�the�review�and�re-alignment�of�the�
strategic�priorities,�implementation�plans�and�key�performance�indicators�for�AsgiSA-EC.�
AsgiSA-EC�has�to�date�developed�and�adopted�an�organizational�strategy, five-year�
business�plan,�implementation�plan�and�balanced�scorecard.��Included�therein�is�a�funding�
requirement�of�R546�million�for�2009/2010�financial�year�and�R622�million�for�2010/2011�
financial�year.��
To�date,�AsgiSA-EC�has�only�received�a�Treasury�commitment�for�R150�million�for�the�
2009/2010�financial�year�and�R100�million�for�the�2010/2011�financial�year.��
As�a�result�of�the�funding�shortfall,�management�has�embarked�on a�process�to�re-align�the�
strategic�priorities,�implementation�plans�and�key�performance�indicators�in�line�with�the�
commitment�received�to�date.
AsgiSA-EC�approached�KPMG�and�ECSECC�to�facilitate�the�reviewing�and�re-alignment�of
Why the review
The�strategy�review�was�driven�by�a�number�of�considerations,�including:
� New�term�of�government�and�redefined�national�and�provincial�priorities.��This�includes�
the�renewed�focus�on�rural�development.
� Review�alignment�with�current�government�programmes�and�strategic�direction
� Kick-start�the�annual�strategic�review�process�and�share�lessons�learnt�from�first�year�of�
operation
� Ensure�ongoing�stakeholder�dialogue�on�the�strategic�direction�of�AsgiSA-EC.
Expected outcomes
Management�expected�the�following�outcomes�from�the�strategy�review�session:
� Alignment�of�the�strategy�and�operational�plans�of�ASGISA-EC�with�provincial�priorities,�
particularly�the�Rural�Development�Strategy�
� Facilitate�stakeholder�and�expert�input�on�the�ASGISA-EC�strategy
� Obtain�broad�stakeholder�consensus�on�the�position�of�ASGISA-EC
� Broad�stakeholder�input�and�agreement�on�the�5�year�strategy�and focus�for�ASGISA-
EC,�HIPP�focus�areas�and�funding�model
� Suggested�solutions�to�address�key�project�implementation�problems.
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6©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Methodology and approach
This�section�defines�the�methodology�and�approach�utilised�to�facilitate�
the�strategy�review�session
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7©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Workshop approach
KPMG�and�ECSECC�were�
the�key�facilitators,�with�
KPMG�performing�the�lead�
facilitation�role.
More�than�60�participants�
and�stakeholders�attended�
the�two�day�strategy�
workshop�held�from�13�– 14�
August�2009.
The�output�of�the�strategy�
workshop�is�intended�to�
provide�input�into�revising�
the�existing�AsgiSA-EC�
organisational�strategy�
document.
General
� A�detailed�workshop�programme�was�developed�and�utilised�for�the day.��Refer�to�Annexure�E�for�detailed�programme.
� Participants�received�preparatory�material�outlining�key�information�regarding�the�workshop,�including�expected�outcomes�and�what�was�expected�from�the�workshop�
participants.
National and provincial policy and strategy paradigm
� A�brief�presentation�was�made�by�Ms�Thandi�Mbete of�the�Department�of�Rural�Development�(DARD)�on�the�Provincial Agriculture�and�Rural�Development�Strategic�
Perspective.��Thandi�focused�on�the�provincial�six�pillar�strategy�being�developed�and�the�planned�institutionalised�co-ordination�and�integration�of�effort.��For�a�copy�of�the�
presentation,�refer�to�Annexure�A.
� A�second�presentation�was�made�by�Mr�Zolile Ntshone of�ECSECC�focusing�on�the�implications�of�the�provincial�rural�development�strategy�for�AsgiSA-EC.�For�a�copy�of�the�
presentation,�refer�to�Annexure�B.
Current AsgiSA-EC strategy and HIPP programmes
� Ingerop Africa�made�a�presentation�to�the�plenary�on�the�Mzimvubu�Water Resource�Development.�For�a�copy�of�the�presentation,�refer�to�Annexure�C.
� The�CEO�of�AsgiSA-EC,�Mr�Simphiwe�Somdyala�concluded�the�session�with�a�presentation�on�the�progress�on�the�implementation�of�the�current�strategy.�Simpiwe�
presented�some�of�the�highlights�from�the�year�that�has�passed�and�also�highlighted�key�lessons�learnt,�including�thoughts�for�group�discussion�and�deliberation.�For�a�copy�
of�the�presentation,�refer�to�Annexure�D.
Detailed approach
Approach utilised
Obtain overview of
national and
provincial policy
and strategy
paradigm
Obtain input on
current AsgiSA-EC
strategy and HIPP
programmes -
including key lessons
learnt
Conduct group
discussions and
obtain input
(through parallel
sessions) on future
strategy
Identify and
highlight key
emerging strategy
considerations
Collate workshop
inputs and
recommendations
Prepare
workshop output
report
Close
project
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8©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative8
Workshop approach (continued)
Group discussions and input on future strategy
� The�delegates�divided�themselves�into�four�groups,�with�each�group�being�tasked�with�discussing�one�of�the�following�topics:
� Funding�Models�and�resource�mobilisation�(principal�facilitator: Gugu�Nxiweni�– KPMG)
� High�Impact�Priority�Programme�(HIPPs)�and�project�enablers�(principal�facilitator:�Gcobani�Ntshanga�– AsgiSA-EC,�co-facilitator�Garry�Simms�– KPMG�)
� Stakeholder�mobilisation�and�institutional�capacity�(principal�facilitator:�Chuma�Sangqu�– AsgiSA-EC,�co�facilitator�Siv�Helen�Hesjedal�– ESCECC)
� Strategic�location��and�organisational�capacity�(principal�facilitator:�Luvuyo�Thomas�– AsgiSA-EC,�co-facilitator�Jacques�Buchner�– STBB)
� The�following�presentations�were�made�by�the�following�individuals:
Working�group�1:
� Reg�Max�(PWC)
� Janine�Baxter�(AsgiSA-EC).�
Working�group�2:
� Thukela�Mashologu�(AsgiSA-EC)
Working�group�3:
� Chuma�Sangqu�(AsgiSA-EC)
On�Day�2,�a�representative�from�each�group�gave�feedback�to�the�rest�of�the�convention,�with�the�opportunity�for�other�members�to�pose�questions�or�add�their�comments.
Detailed approach (continued)
Approach utilised
Obtain overview of
national and
provincial policy
and strategy
paradigm
Obtain input on
current AsgiSA-EC
strategy and HIPP
programmes -
including key lessons
learnt
Conduct group
discussions and
obtain input
(through parallel
sessions) on future
strategy
Identify and
highlight key
emerging strategy
considerations
Collate workshop
inputs and
recommendations
Prepare
workshop output
report
Close
project
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9©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Workshop approach (continued)
Key emerging strategy considerations
� On�Day�2,�a�representative�from�each�group�gave�feedback�to�the�rest�of�the�workshop�participants,�with�the�opportunity�for�other�members�to�pose�questions�or�add�their�
comments.
� The�CEO�of�AsgiSA-EC,�Mr�Simpiwe�Somdyala,�presented�to�the�group�the�high-level�emerging�strategy�issues.��An�opportunity�was�given�to�participants�to�give�their�input�
into�this�consolidated�input.
Workshop input collation
� KPMG�and�ECSECC�facilitated�the�collation�of�inputs�and�recommendations�to�the�future�strategy.
Workshop output report
� This�report�represents�the�workshop�output�report�and�was�developed�by�KPMG�with�the�input�of�ECSECC�and�AsgiSA-EC�management.
Detailed approach (continued)
Approach utilised
Obtain overview of
national and
provincial policy
and strategy
paradigm
Obtain input on
current AsgiSA-EC
strategy and HIPP
programmes -
including key lessons
learnt
Conduct group
discussions and
obtain input
(through parallel
sessions) on future
strategy
Identify and
highlight key
emerging strategy
considerations
Collate workshop
inputs and
recommendations
Prepare
workshop output
report
Close
project
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10©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback
This�section�outlines�the�issues�raised�at�the�different�working groups�and�
the�proposals/recommendations�emanating�from�these�working�groups
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11©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – focus areas
Working group 3: Stakeholder mobilisation and institutional capacity
Group focus
This�working�group�was�requested�to�focus�on�the�following�areas:
� Approach�towards�stakeholder�facilitation
� Building�local�institutional�capacity
� Agreement�on�approach�to�be�followed�(e.g.�Nodal�and�cluster�approach)
� Use�of�extension�officers�and�departmental�linkages
� Linkage�to�institutions�of�higher�learning,�including�partnerships�and�alignment�
to�different�spheres�of�government.
Group focus
This�working�group�was�requested�to�focus�on�the�following�areas:
� Funding�model�for�AsgiSA-EC
� How�to�mobilise�resources�from�government
� Best�structure�to�support�above�(e.g.�Eastern�Cape�Rural�Development�Fund)
� Management�of�funds�to�projects
� Micro-financing
� Private�sector�involvement/funding
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
Group focus
This�working�group�was�requested�to�focus�on�the�following�areas:
� Relevance�of�HIPPs
� Agreement�on�key�HIPP�focus
� HIPP�targets
� HIPP�budgets
� Identification�of�key�enablers�(particularly�for�agricultural�development�- Capacity�
development�and�infrastructure�development)
� Lessons�learnt�and�addressing�these�going�forward
� Existing�Irrigation�schemes�and�linkage�to�HIPPs
Working group 1: Funding models and resource mobilisation
Working group 4: Strategic location and organisational capacity
Group focus
This�working�group�was�requested�to�focus�on�the�following�areas:
� Agreement�on�/�continued�applicability�of�vision,�mission�
� Strategic�principles�going�forward
� ST�solution�to�legislative�listing�(e.g.�TDRF�or�ECRFC)�– agreement�on�
appropriate�vehicle�to�achieve�strategic�objectives
� LT�strategic�considerations:�Long�term�solution�for�rural�development�in�the�
Eastern�Cape�(eg.�EC�RDA,�consolidation�of�PE’s,�etc)�
� Methods�and�approach�towards�influencing�shareholder
� Concept�of�RDA�and�how�AsgiSA-EC�aligns/positions�itself
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12©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Proposals/recommendationsKey issues
Focus Area: Funding model and resource mobilisation
Working group 1: Funding models and resource mobilisation
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Adoption� of� funding� model� with� proposed/recommended� changes� as� identified�
below.
− Funding�sources:�Add� local�government�and�community� trusts�as� a�potential�
funding� source� that� could� be� accessed� for� projects� which� are� within� the�
respective�local�government�jurisdiction�and�are�on�communal�land.
− When�sourcing�funding,�AsgiSA-EC�should�manage�the�risks�associated�with�
different� funders� including� regulatory�or� reporting� requirements.� �As� such,� it�
was�proposed�that�risk�management�be�added�as�a�cross�cutting�part�of� the�
funding�model.
− That�government�should�directly�fund�the�operating�expenditure�of�AsgiSA-EC.��
Although� the�proposed� funding�model� included� income�derived� from project�
management� and� administration� fees,� the� group� participants� felt� that� the�
aforementioned� fees� should� be� viewed� as� an� add-on� to� the� proposed�
government� funding.� � Operational� funding� includes� salaries� and� overheads�
(both�fixed�and�variable).
− The� need� to� quantify� the� asset� base� being� referred� to� within� the funding�
model�and�perform�a�due-diligence�on�the�TDRF.
� The� balance� between� government� and� external� funding� be� maintained� at� a�
minimum�ratio�of�R1:R1�basis,�provided�that�nothing�would�prohibit�this�ratio�from�
moving�favourably�towards�more�government�funding.�
� Recapitalisation�of�AsgiSA-EC�by�government�on�a�yearly�basis�taking�into�account�
that�the�organisation�is�less�likely�to�generate�sufficient�project�investment�returns�
in�the�short�term.
Group�participants�discussed�the�following�issues:
� The�need�to�ensure�that�the�funding�model�differentiates�between short�term�and�
long�term�funding�requirements�in�view�of�the�need�to�match�funding�sources�with�
funding�requirements.
� The�need�to�specifically�identify�the�role�that�can�be�played�by community�trusts�
and�local�government�within�the�AsgiSA-EC�funding�model.��This�was�in�view�of�the�
existence�of�community�based�structures�and�trusts�which�may�have�access�to�
funding�for�projects�situated�in�their�respective�areas,�and�the existence�of�funding�
from�local�government�for�specific�projects�within�their�jurisdiction.
� The�need�to�balance�funding�that�is�received�from�government�and that�which�is�
received�from�external�funders.��This�was�identified�as�something�that�could�
become�a�potential�issue�going�forward�if�not�managed�properly,�particularly�in�view�
of�the�extent�of�funding�which�may�be�required�for�the�projects. In�essence,�the�
view�of�the�group�was�that�should�external�funding�far�outweigh�government�
funding,�such�external�funders�could�directly�or�indirectly�influence�the�direction�of�
AsgiSA-EC�in�a�way�that�could�affect�the�envisaged�mandate�and�impact�originally�
intended�for�AsgiSA-EC.
� The�need�to�access�private�sector�funding�and�to�access�available�private�sector�
financial�tools.��With�respect�to�funding,�private�sector�corporate�social�investment�
(CSI)�funding,�in�particular�from�those�entities�who�are�beneficiaries�of�government�
contracts,�was�identified�as�a�potential�funding�source�that�could�be�tapped�into�by�
AsgiSA-EC.��In�order�to�co-ordinate�such�CSI�funding�effectively,�it�was�identified�
that�a�structure�would�need�to�be�put�in�place.��Refer�to�issues discussed�in�focus�
area:�structures.
� The�need�for�direct�government�funding�for�AsgiSA-EC�operating�expenditure�as�
opposed�to�relying�on�revenue�derived�from�project�management�and�
administration�to�fund�such�operating�expenditure.
� The�need�for�proper�risk�management�processes�and�a�funding�approach�which�is�
informed�by�such�processes.
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13©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Proposals/recommendationsKey issues
Focus Area: Structures
Working group 1: Funding models and resource mobilisation
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Establishment�of�special�fund�– eg.�rural�development�fund.
� Creating�a�bridging�fund�which�should�be�applied�in�instances�where�there�are�third�
party�delays�to�providing�funding�and�resources�to�AsgiSA-EC�funded�projects.��This�
fund�should�be�primarily�funded�from�returns�on�project�investments.
� Create�portfolios�in�order�to�manage�funding�from�the�different�funding�sources.
� In�order�to�ensure�PFMA�compliance,�AsgiSA-EC�would�need�to�be�pro-active�and�
get�Provincial�Treasury�approval/dispensation�for�the�above.
Group�participants�discussed�the�following�issues:
� Possibility�of�establishing�a�special�fund�for�rural�development in�the�Eastern�Cape.��
Reference�was�made�to�the�existence�of�the�KwaZulu�Natal�(KZN)�Growth�Fund�
used�to�stimulate�economic�development�within�the�KZN�province.
� The�need�to�address�the�impact�on�projects�from�not�receiving�agreed�upon�funding�
and�resources�on�time.��This�was�identified�as�being�potentially due�to�third�party�
procurement�delays.
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14©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Proposals/recommendationsKey issues
Focus Area: Investments
Working group 1: Funding models and resource mobilisation
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Adoption�of� investment�policy�principles�with�proposed/recommended�changes�as�
identified�below.
− The� focus� and� main� investment� policy� driver� should� be� developmental�
funding� as� opposed� to�AsgiSA-EC�playing� the� role� of� a�micro-lender. As� a�
result,�it�was�felt�that�the�investment�policy�adopts a�developmental�funding�
approach�linked�to�investments�in�sustainable�projects.
− Shareholder� compact� with� shareholder� needs� to� address� the� issue� of�
directives�in�respect�of�projects�to�be�funded.
− AsgiSA-EC� technology� investments� should� rather� focus� on� technology�
advancement�and�not�ownership� in�order� to�avoid� issues�and�costs related�
with�intellectual�property�emanating�from�technology�ownership.
− Incorporate� the� need� for� management� to� develop� and� document� clearly�
defined�exit�strategies�as�one�of�the�investment�criteria.
� AsgiSA-EC�should�focus�on�using�government�procurement�as�one�of�the�means�to�
mobilising/accessing�market�for�the�projects.
� AsgiSA-EC�should�leveraging�off�other�similar�entities�/�entities�with�similar�focus�as�
a�first�priority.
Group�participants�discussed�the�following�issues:
� One�of�the�proposed�criteria�for�development�investments�was�that�of�an�overriding�
Premier/MEC� directive� to� fund� particular� projects.� � The� group� identified� that� this�
could�be�viewed�as�possible�political�interference�and�could�adversely�impact�on�the�
autonomy�of�AsgiSA-EC.
� The� need� to� clarify�whether� proposed� investments� in� technology� are� focused� on�
new�technology�inventions�or�merely�advancing�technology.��Where the�focus�was�
on� investing� in� new� inventions,� how� the� intellectual� property� associated� with�
investments�in�technology�would�be�managed.�
� The�Micro-lending�vs.�Development�Funding�debate.��The�group�was�of�the�opinion�
that� the� investment� policy� would� need� to� be� focused� on� providing development�
funding�to�sustainable�projects�and�the�wording�and�criteria�selection�would�need�to�
reflect�that.
� That� rural� development� and� in� particular� project� infrastructure� investment� should�
follow�a�commercial�development�approach�with�infrastructure�investment�made�to�
enable�and�in�some�areas�improve�project�access�to�markets.
� The� need� to� ensure� that� there� is� no� duplication� of� effort� and� that� stakeholders�
involved�in�this�arena�do�not�compete�in�funding�projects.
� Ensuring� that� AsgiSA-EC’s� own� supply� chain� management� is� driven� by� efficient�
procurement�policies�and�procedures.
� The�need�for�incorporating�exit�criteria�for�project�selection�criteria.�� In�this�regard,�
there� was� a� view� that� there� was� best� practice� exit� strategies� available� and� that�
AsgiSA-EC�should�access�these.
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15©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus areas: General
General
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� That� all� the� existing�HIPPs� remain� relevant�with� the� primary�HIPP� focus� being� on�
Agriculture� &� Agro-processing,� Forestry� Development,� Water� Resource�
Development�and�Hydro�&�alternative�energies.
� For� each� of� the� HIPPs,� AsgiSA-EC� should� identify� other� relevant� mandated� role-
players� and� that� a� consultative� process� be� followed� and� roles� clearly� established.�
These� roles� should� be� agreed� to� ensure� a� co-operative� approach� and� to� create�
efficiencies.
� That� AsgiSA-EC’s� role� be� considered� “catalytic”,� however� this� would� require� an�
element� of� both� facilitation� and� implementation�which�would� be� determined� on� a�
project�by�project�basis.
� The� targets� should� remain� as� currently� identified,� however� short to�medium� term�
targets�should�be�assessed�in�terms�of�realistic�constraints�eg. funding�or�capacity.��
Consequently�shortfalls�or�gaps�in�targets�would�be�identified�for�further�goal�setting�
eg.�funding�initiatives.
� Improvement�of�local�training�institutions.�
� There� is� a� need� to� look� at� other� failed� agricultural� projects,� and� look� for� ways� to�
resuscitate�them.
� Climate�change�needs�to�be�considered�during�the�planning�stages of�HIPP�projects.
� Post-settlement�support�is�a�possible�role�for�AsgiSA-EC,�or�at�least�a�consideration�
within�the�Province.
� Look�at� lessons� learnt� from�other�provinces and� identify�best�practice� from�within�
SA�and�outside�of�SA.
Group�participants�discussed�the�following�issues:
� Whether�or�not�the�existing�HIPP�projects�still�relevant�and�appropriate�for�AsgiSA-
EC
� A� lot� of� discussion� focused� on� determining� AsgiSA-EC’s� role� in� the� HIPPs� and�
whether� there� is� any� overlap� or� conflict� with� the� roles,� mandates� and/or�
competencies�of�other�Departments�or�entities
� Whether�AsgiSA-EC�should�play�a�role�of�facilitation�or�implementation
� Whether�the�short�to�medium�term�targets�for�each�of�the�HIPP�KPAs�should�be�
revised�or�amended.
Proposals/recommendationsKey issues
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16©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Agriculture and Agro processing
General
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Identify,�prepare�and�assess�business�cases�to�government
� Explore�and�formulate�partnerships�with�local�authorities
� Create�a�process�for�community�facilitation�/�community�resolution
� Create�programmes�for�awareness,�training�and�capacity�building
� Enhance�site�assessment�processes�to�ensure�planting�on�productive�land
� Joint�planning�between�the�institutions�and�role-players�with�clear�responsibilities�
and�formulate�partnerships�or�co-operative�arrangements.
Group�participants�discussed�the�following�issues:
� Need�to�consider�elements�of�infrastructure�to�support�these�initiatives�eg.�roads.
� Need�for�clarification�on�land�ownership�matters.
� Capacity�and�or�skills�restrictions�for�implementation�and�sustainability
� Lack�of�integrated�planning�between�role�players�could�lead�to�duplication�or�gaps.
Proposals/recommendationsKey issues
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17©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Identify� capabilities� in� line� with� budget� and� constraints,� identify� shortfalls� and�
identify�other�funding�sources�eg.�Land�Bank,�IDC,�DBSA,�etc.
� Perform�current�and�long�terms�needs�assessments�and�develop�business�cases�
for�funding�and�implementation.
� Explore�and�formulate�partnerships�with�key�suppliers.
� Determine�consolidated�budgeted�funding�amongst�role-players�and�direct�funding�
to� AsgiSA-EC� as� an� implementing� agent, with� funding� ring� fenced� for� specific�
purposes
� Develop�business�cases� and� look� for�partners� for� joint� funding�on� a� commercial�
basis.
Group�participants�discussed�the�following�issues:
� Existing�budgets�restrictions�vs.�expected�targets
� The�lack�of�storage�facilities�eg.�silos
� Input�suppliers�(fertilisers,�seeds,�chemicals)
� Funding�commitment�for�infrastructure�(fencing)
� Value�Addition�(requirements�for�processing�in�form�milling,�pack�houses�etc)
Focus Area: Agriculture and Agro processing (continued)
Dry Land Cropping
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
Proposals/recommendationsKey issues
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18©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Agriculture and Agro processing (continued)
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Government� to� be� requested� to� determine� and� define� best� institutional�
mechanisms�for�schemes
� Perform�status�quo�and�needs�assessments�and�create�ring�fenced�refurbishment�
plan�and�investment�plan
� Medium�to�long�terms�needs�to�be�immediately�assessed�and�to�be�assessed�with�
realistic�available�and�expected�supply.��Thereafter�AsgiSA-EC�should� implement�a�
procurement�plan�to�address�the�above.
� Market�intelligence�programmes�to�be�established�to�determining, on�a�commercial�
basis,�realistic�levels�of�demand�and�supply.��Land�assessment�programmes�would�
be�required�to�determine�viability�and�alignment�with�plausible�and�required�crops�to�
ensure�maximum�yields,�volumes�and�create�efficiencies.
Group�participants�discussed�the�following�issues:
� Institutional�arrangements�which�were�seen�to�be�confusing�(Trust,��Producers�
Assembly�and�Local�Traditional�Authorities)
� Infrastructure�may�be�dilapidated
� Access�to�seedlings�for�citrus�may�only�be�possible�by�2012�due�to�increased�
demand.
� Choice�of�areas�and�crops�sometimes�not�ideal.
Irrigation and fruit production
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
Proposals/recommendationsKey issues
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19©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Agriculture and Agro processing (continued)
Livestock
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Consider�CASP�funds
� Identification�of�potential�Public�Private�Partnerships
� Consider�sharing�of�infrastructure�such�as�loading�ramps
� Consider�partnerships�with�existing�operators
� Should�look�at�the�opportunities�for�local�abattoirs.
Group�participants�discussed�the�following�issues:
� Fencing�and�in-farm�infrastructure�may�be�poor�or�inappropriate
� Farm�roads
� Constraints�by�Land�Bank�loans
� Lack�of�infrastructure�and�enabling�plant
� Awareness,�capacity�and�experience�of�current�long�haul�costs�to abattoirs.
Proposals/recommendationsKey issues
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20©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Forestry
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� IDC�should�be�the�first�source�of�funding
� Improvement� of� local� training� institutions� and� development� of� practical� capacity�
building� and� skills� development� programmes� in� line� with� training FIETA� training�
objectives�and�mandate�as�required�by�the�Skills�Development�Act
� Resolution�of� issues�with�communities� (proper�community� facilitation)�by�creating�
community�facilitation/resolution�plans�and�increasing�awareness
� Dept�Public�enterprises�to�be�discussed
� Integrated�planning�initiatives,�in�line�with�the�general�comments,�to�be�considered�
in�line�with�bilateral�agreements�with�DAFF.
Group�participants�discussed�the�following�issues:
� Funding�constraints�and�sources
� Post�settlement�support�for�land�claimants
� Poor�or�inappropriate�roads�and�infrastructure
� Competition�with�agricultural�land
� Fire�damage�and�loss,�as�well�as�the�lack�of�facilities�to�deal�with�the�aforesaid
� Skills�development/capacity�building�is�required
� Struggle�with�SFRA�licensing
� Communal�land�and�mobilisation�of�communities
� Ports�and�infrastructure
� Forestry�considered�last�area�for�expansion.
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
Proposals/recommendationsKey issues
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21©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Proposals/recommendationsKey issues
Focus Area: Water Resource Development
In�line�with�the�issue�discussed,�the�group�made�the�proposal/recommendation�that�the�
focus�should�be�on�multipurpose�use�of�water�resources�(joint�planning).
Group�participants�discussed�the�issue�of�duplication�in�planning�(municipalities�focus�
on�drinking�water).
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
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22©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Proposals/recommendationsKey issues
Focus Area: Hydropower and alternative energies
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Investigate� opportunities� in� other� areas� eg.� thermal� energy� opportunities� in�
Ukhahlamba
� AsgiSA-EC�should�be�focusing�on�areas�with�no�electricity
� Hydropower�should�be�separated�from�the�other�forms�of�energy.
Group�participants�discussed�the�potential duplication�in�what�ELIDZ�and�AsgiSA-EC�are�
doing.
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
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23©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Tourism
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Need�to�perform�an�assessment�of�roads�and�infrastructure�needs�and�motivation�of�
needs�with�business�plans,�driven�from�both�an�economic�and�historical�perspective.
� Linkages�with�other�role-players�eg.�ECTB,�ADM�etc.
� AsgiSA-EC�role�should�be�a�high� level� role� focused�on�determining�and�addressing�
current� gaps,� ensuring� mobilization� of� communities� and� facilitating� or� intitiating
strategic�partnerships.
� Tourism�remain�as�a�stand-alone�HIPP.
Group�participants�discussed�the�following�issues:
� This�HIPP�is�very�broad�and�other�entities�have�specific�mandates�eg.�EC�Tourism�
Board.
� The�role�for�AsgiSA-EC�within�the�HIPP
� Perceived�plans�in�place�with�other�role-players,�however�there�was�a�lack�of�
visible�implementation.
� Tourism�destinations�may�be�hampered�by�infrastructure�matters�eg.�Roads.
� Whether�or�not�the�tourism�HIPP�should�rather�be�considered�as�a transversal�
matter�in�other�HIPPs.
Proposals/recommendationsKey issues
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24©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Human settlement
In� line�with� the� issues�discussed,� the�group�made�a�proposal/recommendation�of� the�
need�to�further�assess�and�redefine�AsgiSA-EC’s�role�within�this�HIPP
Group�participants�discussed�the�following�issues:
� Question�about�AsgiSA-EC’s�role�in�respect�of�Human�Settlement�and�Planning
� Perhaps�this�HIPP�is�overarching�rather�than�a�specific,�stand-alone�HIPP
� Strong�possibility�for�overlaps�if�not�managed�carefully and�contradiction�with�legal�
roles�eg�local�authorities.
Working group 2: High Impact Priority Programmes (HIPPs) and project enablers
Proposals/recommendationsKey issues
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25©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Approaches to stakeholder management (national, provincial and regional)
Working group 3: Stakeholder mobilisation and institutional capacity
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Bilateral�meetings�to�be�held�urgently�with�identified�stakeholders�that�responded�to�
the�invitation�to�attend�the�strategy�session.
� Identify�political�champions�at�Local�Municipal�and�District�Municipal�level.�
� The�employment�of�a� large�cadre�of�social� facilitators�directly�by�AsgiSA-EC� is�not�
encouraged.� Long� term� partnerships� should� rather� be� entered� into with� exiting�
institutions�that�have�expertise�(e.g.�ECATU,�IDT,�and�DEDEA).�
� Make�use�of�local�resources�for�social�facilitation;�these�can�be�included�in�the�local�
area�committee.�Identified�people�from�community�and�project�steering�committee�
members�can�then�be�trained�both�on�technical�production�related skills�and�social�
facilitation�skills
� Develop� guidelines� for� community� mobilisation� and� organisation� in� AsgiSA-EC�
projects.�
� Develop�exit-criteria�for�winding�up�support�to�a�project/community�that� is�not�only�
based�on�time,�but�sustainability.�
� AsgiSA-EC/RDA�to�have�provincial�reach�and�mandate.�
� Scope� should� include� enterprise� development,� tourism,� infrastructure,� integrated�
planning.�
Group�participants�discussed�the�following�issues:
� Involve�stakeholders�in�decision�making�and�project�implementation�
� Use�local�municipalities�better�for�coordination�of�the�work�of�stakeholders.�Involve�
local�municipalities�from�the�start.��Key�structures:
−Ward�committees�
−CDWs
−Traditional�leaders�
−Councillors
� Engage�councillors�and�traditional�leaders�together�– not�separately.�
� Always�engage�leadership�before�engaging�community�members
� Stakeholder�identification�should�take�place�for�each�project
� Meet�all�stakeholders�the�same�time,�not�separately�– and�not�once�off
� Consider�what�time�of�the�year�consultation�is�carried�out/project�started,�esp.�due�
to�migration,�agricultural�seasons�etc.
� Recognise�that�social�facilitation�is�a�long�process.�Contracts�with�service�providers�
should�ensure�sustainability.� Facilitation� requires�great� deal� of� flexibility,� not�one-
size-fits-all�approach.
� Top-down� approaches� do� not� function,� thus� there� needs� to� be� support� for� local�
level�organisations
Proposals/recommendationsKey issues
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26©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Building local institutional capacity
Working group 3: Stakeholder mobilisation and institutional capacity
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Ensure�women�are�the�core�of�the�people�trained�to�increase�sustainability.�
� Build� local� institutional� capacity� through� work� with� partner� organisations� and� the�
establishment�of�community�trusts,�CPAs,�coops�etc.�
� Institutions�that�can�assist�with�capacity�development�of�project�members:�
�CRD�(WSU)�(cooperatives�and�social�facilitation)�
�Tsolo FET�College�and�Universities�(agricultural�skills)
�Department�of�Labour��(when�skills�needs�are�identified)�
�AgriSETA (agricultural�skills)
� ASGISA-EC�to�support�the�development�of�a�provincial�cadre�of�Abakwezeli through�
the� proposed� Co-operative� Development� Institute.� These� will� be� selected� from�
existing�institutions�as�well�as�community�level��(co-operatives�and�social�facilitation)
� Training/support�for�project�steering�committee�and�local� level�organisations�should�
also�include�financial�and�administrative�skills,�book-keeping�etc.��
� Technical� project� implementers� need� to� be� monitored� by� the� local
community/steering�committee�– to�ensure�success�of�projects.
� There� should� be� medium/long� term� mentoring� and� follow� up� of�
projects/communities�where�AsgiSA-EC�is�involved.
� Social�facilitators�should�have�conflict�resolution�mechanisms.
Group�participants�discussed�the�following�issues:
� Weak�institutional�structures�at�project�level�
� Projects�often�driven�by�a�few�individuals�only�
� Role�clarification�of�different�stakeholders
� Ensure� women� are� the� core� of� the� people� trained� to� increase� sustainability.�
However,�women�do�not�take�part�in�the�project�steering�committee.�Tie�projects�
to�youth�development�strategies.
� Participation�from�the�onset�enhances�the�speed�of�decision�making
Proposals/recommendationsKey issues
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27©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: The proposed AsgiSA-EC cooperative model
Working group 3: Stakeholder mobilisation and institutional capacity
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Partnership�project�with�DEDEA�to�carry�out�audit�of�existing�coops�in�target�areas.�
� Engagement� with� DEDEA� and� other� entities� to� learn� from� existing� and� past�
approaches�and�initiatives�for�cooperative�development.
� Legal� issues� about� shareholding� and� ownership� of� cooperatives� need� to� be�
investigated.�
Principled�endorsement,�but�there�is�need�to�engage�on�the�following�issues:�
� Secondary�cooperative�to�be�formed�by�primary�cooperatives��- not�from�the�top
� Independence�and�autonomy�and�the�principals�of�cooperation�should�for�the�basis�
for�the�model.�
� Voluntary�participation�in�cooperatives�and�organic�formation�of cooperatives�to�
avoid�past�mistakes�of�cooperatives�created�by�state�institutions.�
� Members�should�be�the�owners�of�secondary�cooperative�- ASGISA-EC�as�
shareholder?�
� Beneficiation�and�profit�sharing�
� Sharing�of�risk�and�contractual�agreements�between�primary�cooperatives�and�
secondary�coop
� Long�term�support�and�mentoring�of�primary�cooperatives�to�ensure�sustainability�
and�ensuring�quality�of�produce�
� Voluntary�participation�in�cooperatives�and�organic�(bottom�up)�formation�of�
cooperatives�to�avoid�past�mistakes�of�cooperatives�created�by�state�institutions.�
� Payment�turn-over�time�for�produce�
� Link�to�existing�Agri-parks�
� Provide�link�between�homestead�and�subsistence�producers�and�surplus�
production.
Proposals/recommendationsKey issues
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28©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Nodal and Cluster approach
Working group 3: Stakeholder mobilisation and institutional capacity
The�group�proposed/recommended�that�further�engagement�with�the�model�is�made�by�
partners.
In�principle�endorsement�of�the�model,�but�engagement�must�take�place�on�the�
following:
� Joint�stakeholder�engagement�
� Linkage�to�IDPs
� Ward�based�planning�– who�drives�it:�ASGISA-EC�or�LM?�
� Projects�within�nodes�must�be�based�on�identified�need�
� The�involvement�of�other�sector�departments�
� Revisit�the�GDS�projects�as�basis�for�project�and�cluster�selection
� Combination�of�bottom-up�and�top�down�approaches�to�planning�and�development�
projects
Proposals/recommendationsKey issues
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29©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Linkage to institutions of higher learning
Working group 3: Stakeholder mobilisation and institutional capacity
In� line� with� the� issues� discussed,� the� group� made� the� following�
proposals/recommendations:
� Research�&�Development�and�innovation�in�the�rural�development�field�as�core�areas�
of� ASGISA-EC� should� be� considered,� but� be� done� in� partnership� with� other�
institutions.
� Higher�Education�Institutions�used�as�partners�in�training�and�capacity�development�
as�well�as�research.�There�could�be�closer�linkage�with�HEI�and�research� institutes�
for�research,�impacts�monitoring�and�longitudinal�studies�in�areas�where�ASGISA-EC�
work.�This�would�enhance�the�understanding�of� impact�at� level�of community�and�
broader�economy.
� Research�&�Development�and�innovation�in�the�rural�development�field�as�core�areas�
of� ASGISA-EC� should� be� considered,� but� be� done� in� partnership� with� other�
institutions.
� Higher�Education�Institutions�used�as�partners�in�training�and�capacity�development�
as�well�as�research.�There�could�be�closer�linkage�with�HEI�and�research� institutes�
for�research,�impacts�monitoring�and�longitudinal�studies�in�areas�where�ASGISA-EC�
work.�This�would�enhance�the�understanding�of� impact�at� level�of community�and�
broader�economy.
Group�participants�discussed�the�following�issues:
� Organisation� should� address� research,� development� and� innovation to� set� itself�
apart�from�other�organisations.�This�is�the�area�that�gives�a�cutting�edge�and�drives�
future�development.
� Organisation� should� address� research,� development� and� innovation to� set� itself�
apart�from�other�organisations.�This�is�the�area�that�gives�a�cutting�edge�and�drives�
future�development.
Proposals/recommendationsKey issues
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30©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Vision, Mission & Strategic Goals
In�line�with�the�issues�highlighted,�the�following�proposals/recommendations�are�made:
� Once�the�ultimate�positioning�of�AsgiSA-EC�has�been�ascertained,�such�as�when�it�
becomes�listed�or�is�merged�with�another�entity,�then�the�present�vision�should�be�
looked�at�in�the�light�of�the�given�positioning.
� That�the�present�mandate�(geographic�focus)�which�confines�AsgiSA-EC�operations�
to�the�Mzimvubu basin�and�Development�Zone�be�reviewed�and�extended�to�look�at�
rural�development�broadly� in� the�Eastern�Cape,�with� the�current�area� remaining�a�
priority.
� AsgiSA-EC�should�consider�a�phased�approach� to�partnerships�and�not� to�embark�
on� a� wholesale� approach� with� too� many� partnerships� done� during� one� season.��
Partnerships�should�be�evaluated�periodically� for�effectiveness� in� terms�of�agreed�
objectives.
� AsgiSA-EC�should�exercise�full�controls�on�expenditure�and�also�ensure�that�proper�
recording,�documentary�and�otherwise�- being�governance�of�supply�chain�aspects�-
is�maintained.
� AsgiSA-EC� should� not� abdicate� its� core� role� of� pursuing� co-ordination,� integration�
and� facilitation� of� platforms� that� are� to� be� established,� through� co-ops� and/or�
community�trusts.
� AsgiSA-EC�should� consider� adding� to� its� strategic� goals� reference� to� the� agrarian�
transformation�strategy�and�Rural�Development�strategy�by�government�.�This�could�
possibly�be�along�the�lines�of�its�readiness�to�cooperate,�coordinate�and�align�with�
the�position�of�the�shareholder.
� AsgiSA-EC� should� further� consider� adding� to� its� strategic� goals� reference� to� its�
commitment�to�empowering�SMMEs.
The�following�issues�are�considered�relevant:
� The�continued�relevance�of�the�present�vision�and mission�of�AsgiSA-EC.
� The�group�raised�the�immense�challenges�faced�by�AsgiSA-EC�in�terms�of:
− Adequate�resource�and�funding�levels
− Wide�spread�geographical�areas�to�be�covered
− Community�readiness
− Smart�partnerships�with�public�and�private�sector�entities�respectively
− Effecting�a�balanced�management�approach�between�facilitation�and�delegation�
of�key�aspects�of�project�operations,�and
− Retention� of� core� mandates� such� as� good� corporate� governance,� risk�
management�and�accountability.
� The� present� strategic� goals� were� viewed� as� relevant� and� that� they� should� be�
vigorously�pursued.��If�anything,�the�present�strategic�goals�should�be�augmented�in�
order� to� read� in� them,� the� ultimate� positioning� of� AsgiSA-EC,� which� should� be�
aligned�to�shareholder�mandate.
Working group 4: Strategic location and organisational capacity
Proposals/recommendationsKey issues
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31©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Institutionalisation
In�line�with�the�issues�highlighted,�the�following�proposals/recommendations�are�made:
� That� a� social� compact/social� charter� should� be� drafted� in� order� to� define� clear�
communication� guidelines� and� obligations� of� parties,� and� should� be� entered� into�
between:
− Management�and�the�Board,�and
− The�Board,�management�and�the�shareholder.
� That�the�ECRFC�route�appears�to�be�the�most�viable�option.� �However,� the�board�
should�consider�ring-fencing�and�cleaning�up�the�projects�and�operations�which�are�
currently�undertaken�by�ECRFC�prior�to�any�integration�of�AsgiSA-EC�with�ECRFC.�
The�Board�should�also�ensure�that�they�follow�the�legislative�processes�should�they�
elect� to� abandoned� the� existing� cabinet� resolution� which� introduced� the� ECDC�
option.�
� That� the� subsidiary� arrangement� with� ECDC� should� only� be� considered� as� an�
interim�measure�and�not�permanent�solution�due�to�the�following�concerns:
− Wider�mandate�of�ECDC�could�result�in�AsgiSA-EC�losing�focus�and�impact
− The�ECRFC�Act�is�more�suited�to�the�AsgiSA-EC�mandate�and�strategy.
� That� the�TDRF�Fund�option�does�not�provide�a�viable�alternative� in� that� the�TDRF�
Act�provides�only�for�administration�of�funds�and�consequently�does�not�solve�the�
listing�problem�which�is�facing�AsgiSA-EC.��However,�the�assets�which�are�held�by�
the�TDRF�could�provide�much�needed�funding�for�AsgiSA-EC�projects.
� In� the�event� that�separate� listing� is� the�preferred� route,�AsgiSA-EC�should�ensure�
that�it�complies�with�the�conditions�communicated�by�provincial�Treasury�regarding�
AsgiSA-EC�PFMA�listing�application.
� That� AsgiSA-EC� should� never� depart� from� its� original� mandate� of� improving� the�
livelihoods� of� the� rural� communities� and� to� engage� vigorously� on any� directives�
which�require�it�to�dilute�its�original�mandate.��AsgiSA-EC�should�also�be�mindful�of�
the� broader� responsibilities� which� may� be� assumed� with� a� “Rural� Development�
Agency” eg.�social�facilitation.
The�following�issues�are�considered�relevant:
� The�present�AsgiSA-EC�reporting�lines,�include�reporting�to:
− AsgiSA-EC�Board�of�Directors�
− Premier�(OTP)
− MEC�Agriculture�(DRAD),�and
− MEC�Economic�and�Environment�Affairs�(DEDEA).
The�group�noted,� however,� that� the� above� scenario� obtains� from� the� unlisted�
status�of�AsgiSA-EC�and�also�reflects�sources�of�its�funding�(except�the�Board).
� The�urgent�matter�of�listing�or�determination�of�the�ultimate�position�of�AsgiSA-EC�
should�be�attended�to.��With�regards�to�the�options�available,�the�group�raised�the�
following:
− That� a� PFMA� listing� application� has� been� made� by� AsgiSA-EC� and� some�
conditions�raised�by�Treasury.�The�group�was�advised�that�a�legal�opinion�on�the�
listing�application�had�been�obtained�which�indicated�that�Treasury�(National�and�
Provincial),�does�not�have�a�discretion�with�regards�to�whether�or�not�to�veto�the�
application�for�listing.
− That�there�were�inherent�problems�with�the�ECRFC�option�and�that these�would�
require�attention�before�any�meaningful�merger�could�take�place�eg.�reputation.
− Fears�were�expressed�that�with� the�ECDC�subsidiary�option,�AsgiSA-EC�could�
become�“a�small�fish�in�a�big�pond” and�its�mandate�could�get�diluted.
− That� the�Previous�MEC�for�DOA� (now�DARD)�had� indicated� that�consideration�
(by�way�of�a�Cabinet�resolution)�was�given�to�aligning�AsgiSA-EC�with�ECDC�so�
that� it� can� become� auditable.� � However,� this� consideration� would now� be�
abandoned�by�the�shareholder.�
− The�MEC� for� DEDEA� has� indicated� that� consideration� was� to� be� given� to� an�
AsgiSA-EC� merger/amalgamation� with� an� alternative� `existing� legal� or� PFMA�
listed�entity.��This�view�galvanised�a�previous�position�which�was�made�by�the�
Premier�to�a�contingent�of�AsgiSA-EC,�which�included�two�board�members,�that�
the�merger/amalgamation�of�AsgiSA-EC�is�still�going�ahead.
Working group 4: Strategic location and organisational capacity
Proposals/recommendationsKey issues
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32©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Working group feedback – key issues and recommendations
Focus Area: Shareholder mobilisation
In�line�with�the�issues�highlighted,�the�following�proposals/recommendations�are�made:
� That�a�social�compact/social�charter�should�be�drafted�(refer�to recommendation�in�
Focus�Area:�Institutionalisation).��This�approach�would�ensures�the�following:
− Streamlining� of� communication� lines� between� management,� the� Board� and�
shareholder
− By�it’s�operation,�it�obviates�delays.
� That�management�and�the�Board�continue�to�strengthen�their�relationships�through�
the�charter�and�other�bilaterals.
The�following�issues�are�considered�relevant:
� AsgiSA-EC,� like�any�parastatal�organisation� is�faced�with�several�challenges,�some�
of�them�already�discussed�under�Focus�Area:�Vision,�Mission�and�strategic�goals.
� The�group�further�noted�that�there�are�three�foremost�challenges that�are�instantly�
recognisable:
− Institutional�uncertainty:�refer�to�Focus�Area:�Institutionalisation
− Funding:�refer�to�working�group�1�and�discussion�around�TDRF�option
− Long�delays�in�decision�making�by�the�shareholder.
� The� impact� of� political� changes� in� general� to� the� operations� and long� term�
positioning�of�AsgiSA-EC.
Working group 4: Strategic location and organisational capacity
Proposals/recommendationsKey issues
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33©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Stakeholders present
Details of stakeholdersStakeholder grouping
� Office�of�the�Presidency�(Policy�Co-ordination�and�Advisory�Services�Unit)
� Dept�of�Agriculture�Forestry�and�Fisheries
� Dept�of�Co-operative�Governance�and�Traditional�Affairs
� Department�of�Water�Affairs�and�Environment
� Provincial�Department�of�Local�Government�and�Traditional�affairs�(EC)
� Provincial�Treasury�(EC)
� Provincial�Department�of�Agriculture�and�Rural�Development
� Provincial�DEDEA
� Ukhahlamba�DM
� OR�Tambo�DM
� Alfred�Nzo DM
� Nyandeni Local�Municipality
� Chris�Hani�DM
� Intsika Yethu Municipality
Provincial�and�National�Government�Department
Local�and�District�Municipalities
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34©2007�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Stakeholders present (continued)
� CapespanOther
Details of stakeholdersStakeholder grouping
� KPMG
� Ingerop
� PWC
� Development�Bank�of�Southern�Africa
� ECRFC
� IDC
� ELIDZ
� CSIR
� Independent�Development�Trust�(IDT)
� Agri Africa
� Ruliv
� Hluma
� Ntinga Development�Agency
� Eastern�Cape�Socio-Economic�Consultative�Council
AsgiSA-EC�Service�Providers
Public�Sector�Entities
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35©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Way forward and next steps
This�section�outlines�the�recommended�way�forward�and�road�ahead for�
AsgiSA-EC
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36©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
Way forward and next steps
Road Ahead
In�order�to�update�the�existing�five-year�organisational�strategy,�AsgiSA-EC�needs�to�ensure�it�takes�this�output�document,�through�the�three�phases�defined�below�in�order�to�
successfully�deploy�and�measure�the�revised�strategy.�AsgiSA-EC�should�ensure�the�strategy�is�aligned�to�both�provincial�and�national�programmes�and�ensure�that�it�incorporates�
performance�measures,�deadlines�and�allocate�accountability�for�all�proposal/recommendations�to�the�AsgiSA-EC�BoD.�
Following�the�fruitful�participation�of�various�stakeholders�in�the�strategy�workshop,�the�key�critical�success�factor�is�obtaining�approval�from�the�AsgiSA-EC�BoD and�shareholder�as�
defined�in�activity�4,�based�on�the�road�map�below:
Conduct strategy
review workshop
Refine strategy
proposals/
recommendations and
develop detailed
strategic initiatives
Obtain BoD and
shareholder approval for
strategic proposals/
recommendations
Refine�and�update�five-year�
organisational�strategy�and�
business�plan
Update�detailed�
implementation�plans
Deploy�revised�organisational�
strategy
Phase 1: Strategy review Phase 2: Strategy refinement Phase 3: Strategy Implementation
Weeks
Activities
1
2
3
4
5
6
1 3 6 10 13 16
Completed
Detailed�
proposals/recommendations�to�
be�tabled�to�BoD for�approval�and�
shareholder�for�ratification
Involves�developing�and�
documenting�the�key�initiatives�
and�issues�that�need�to�be�
addressed
This�activity�needs�to�include�
developing�performance�
measures,�deadlines�and�an�
allocation�of�accountability
AsgiSA-EC�management�to�update�
five-year�strategy�document�with�
approved�BoD strategy�proposals/�
recommendations
A�detailed�implementation�plan�
encompassing�how�the�strategy�
will�be�governed,�resourced,�
monitored�and�measured�should�
be�developed
Strategy�to�be�deployed�
at�both�project�and�
organisational�level
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37©2009�KPMG�Services�(Pty)�Ltd,�the�South�African�member�firm�of�KPMG�International,�a�Swiss�cooperative.�All�rights�reserved.�KPMG�and�the�KPMG�logo�are�registered�trademarks�of�
KPMG�International,�a�Swiss�cooperative
The�recommended�model�is�
designed�to�ensure�proper�
strategy�development,�
implementation�and�
monitoring�of�the�
organisational�strategy�and�
HIPP�implementation�once�
developed.
Recommended strategy development lifecycle model for AsgiSA-EC:
In�order�to�ensure�that�the�AsgiSA-EC�delivers�according�to�it’s�mandate�and�contributes�towards�the�improvement�of�rural�livelihoods,�alignment�to�national�
and�provincial�priorities�and�programmes�is�critical�to�the�success�of�the�organisation.��The�national�and�provincial�priorities for�rural�development�should�be�
assessed�to�ensure�the�detailed�AsgiSA-EC�strategy�is�aligned�to�these�priorities.�This�should�form�the basis�of�a�selection�criteria�for�focus�areas�for�further�
development�of�the�AsgiSA-EC�strategy.��However,�nothing�precludes�AsgiSA-EC�from�pioneering�new�and�innovative�thinking�within�this�sector�and�assisting�
to�inform�government�programmes�and�strategic�decisions�relating to�rural�development.
Input�from�the�various�stakeholders�should�continue�to�be�obtained�in�order�to�develop�a�holistic�strategy�that�reflects�broad�consensus�from�key�stakeholders�
and�role�players,�whilst�obtaining�their�buy-in�and�support.�This�will�assist�in�ensuring�that�the�developed�strategy�is�comprehensive�and�fully�integrated�across�
the�rural�development�sector.
Once�the�strategy�has�been�aligned�it�should�inform�the�HIPP�focus�areas,�targets�and�implementation�plans,�as�well�as�projects�wherein�AsgiSA-EC�will�be�
involved.�Monitoring�mechanisms�need�to�be�put�in�place�to�measure�the�success�of�HIPPs�and�ultimately�the�strategy�developed.
National�priorities
AsgiSA-EC�Organisational�
Strategy
Provincial
government
National�
government
Other�
StakeholdersDBSA
HIPP�focus,�targets�and�
implementation�plans
Agriculture�&�
Agro�processing
Forestry�and�timber
Infrastructure�
development
Alternative�energy
Tourism
Human�settlement
Monitor�success�of�AsgiSA-EC�Strategy Monitor�success�of�HIPP�implementationMonitor�achievement�of�
government�priorities
Strategic input Strategic developmentStrategy and HIPP implementation,
measurement and monitoring
AsgiSA-EC
Provincial�priorities
Way forward and next steps (continued)