South Africa looks ahead at last
SA’s attempts at jump-starting its broken jalopy and getting investment going must have seemed a humble thing at the World Economic Forum, yet recent changes in the country inspired optimism
So, was the SA delegation’s trip to the World Economic Forum in Davos the unmitigated triumph that the praise singers in the media and government would have us believe? Or is this just a façade that glosses over the very real political and economic problems SA still faces?
Doubtless, the visit was something of a new dawn for SA. For the first time in a very long time, the delegation was looking forward at the possibilities rather than looking back at a recent, very public, disaster or setback.
On previous trips to Davos, the delegations were on a mission to explain and excuse rather than set out their stall for the future. That changed this time. The new mood mirrors the infusion of hope that has engulfed SA politics after a generally positive outcome at the ANC’s elective conference.
One of SA’s delegates, trade & industry minister Rob Davies, caught something of the mood, saying that in the past few years foreigners had sought him out simply to air grievances. This year they wanted to talk about their plans.
It’s an indication of the history of SA’s visits to Davos that the delegation had been preparing for the forum in the same way as in the past: as an exercise in explanation and justification. Brand SA CEO Kingsley Makhubela said the delegation felt it had to be seen to address the issues that led to SA’s downgrade by the credit ratings agencies: low economic growth, the state of state-owned enterprises and corruption.
As it happens, concrete events on the ground just prior to the Davos meeting went a long way towards addressing these issues. As a result, delegation leader deputy president Cyril Ramaphosa was able to point to specific interventions to address these issues. The most notable example was the dramatic changes at Eskom, including a revamped board.
That’s a much stronger argument than merely suggesting that at some point in future these things would change. Ramaphosa was able to be quite specific, and his message resonated, Makhubela said. As a consequence, there was a positive attitude towards SA.
Another problem SA faced was that it was slowly gaining a reputation for being politically unstable. This instability, Makhubela said, was always something of a misnomer. Political contests are by their very nature uncertain. But once again the timing was good. The resolution of the uncertainty at the ANC’s elective conference was in itself a positive factor.
The positivity was reflected in a grand speech by Ramaphosa at the annual dinner for SA delegates and friends, attended by a who’s who of SA’s business and political elite. The heads of most SA banks were there, some notable CEOs and the vice-chancellors of several universities.
Ramaphosa was in full voice: “If we are going to grow this economy and address the triple challenge we face we’ve got to look at what impedes growth ... we’ve got to address [it] and we’ve got to address [it] honestly ... It was great to hear the governing party getting to grips with things like that but ... one of the other things that impedes growth in our economy is the whole problem of corruption.
“In the past, we kept talking about perceptions of corruption and we never really grasped the nettle. This time around we did, and said: ‘Yes, there is corruption, and we’ve got to deal with it because it is this corruption that has been permeating the country [and] is impeding growth’.”
At last, Ramaphosa is coming out from behind the curtains, one of the businessmen noted.
The only problem is that it takes an international function like Davos to forcibly remind you that SA is one of hundreds of countries facing the same challenges and largely seeking the same remedies. When the new president of Zimbabwe, Emmerson Mnangagwa; the prime minister of India, Narendra Modi; and the US president all say the same thing — “Come and invest in my country” — you know you are in a highly competitive game.
Modi said it best: “We are removing red tape and laying the red carpet.” But the message was remarkably in tune. Trump said the US was “open for business”. He said: “There has never been a better time to hire, to build, to invest, and to grow in the US.” In comparison with the aggressive pitches of these global giants, SA’s attempts at jump-starting its broken-down jalopy and getting investment going must have seemed a humble thing.
Yet, behind the scenes, clearly, there was movement, somewhat assisted by the fact that global concerns have changed and those changes are themselves reflected in the make-up of Davos. In some ways Davos has spent the past decade edging towards SA and countries like it.
Makhubela says that in years gone by, the Davos meeting was really about issues of government and business. But now a lot of the discussions are about social issues, and the World Economic Forum is trying hard to attract civil society.
Liberty chairman Jacko Maree, who last went in 2010 as a Standard Bank executive, agrees that this year was different. “My sense of it is that in the early 2000s, SA was really well received at Davos. But during the Zuma years, it’s been a relatively uneasy place for Team SA.” This year, you got the sense that SA delegates were broadly singing from the same hymn sheet, “and not doing it because they were told to do so”.
Davos has also changed. “It used to be much more of a straight business forum,” Maree said. “But the introduction of different stakeholders, like social entrepreneurs and academics, has made it more interesting.” And bigger, he said. “There is much more of a scrum now.”
The banking crisis, the recessions around the world, the retreat of democracy, the rise of populism and of the digital economy — these are all now parts of the Davos programme. They are encapsulated somewhat in the phrase “the fourth industrial revolution”, an idea made famous by the forum’s chairman and founder, Klaus Schwab.
In some ways that puts SA in the frame as one of the many countries that constitute a kind of thermometer of how these issues are unfolding.
SA was on the verge of being declared a lost cause.
Now, not so much.