SAM MKOKELI: The problem with investment conferences

SA looked, and sounded, like a completely different country when 1,000 or so people in suits met at the Sandton Convention Centre on Thursday. It was as though the airconditioner released some magical mist that made people effusive about SA’s future. This was the fourth instalment of the SA Investment Conference, an event to market the country as an investment destination. 

Discovery chair Adrian Gore led the way with an upbeat tone on SA, despite its problems. The audience was made up of leading business figures, government ministers and officials, and members of the intellectual circuit. 

For a few hours, SA felt like a different country. The deep problems were drowned out, in narrative contexts at least, by a more positive tone. 

Kudos to Team Ramaphosa for running another successful investment conference, generating serious positivity around SA’s bankability. The investment drive started in 2018, and the numbers are looking good, at first glance. The country is just R60bn short of its R1.2-trillion target. 

It is easy to nitpick about these numbers or punch holes in the narrative. One criticism is that the investments would have been made anyway. A more plausible criticism is that the glowing numbers need to show themselves on indicators like gross capital formation, a broad indicator of investment through the economy.

We would all know if a new R1-trillion rand deposit was made into the economy solely based on “Ramaphoria” or the “new dawn”. There wouldn’t be a need for anyone to blow their trumpets about it.

The biggest problem about “positive narratives” is that they quickly get drowned out by the strength of negative reality. SA is on a structural decline. We are going down, quickly. “Positive narratives” are imaginary, just like Monopoly money. You can earn all the bucks in Monopoly, but you will never translate that to real gains.

The talk from business leaders is misleading. It is leaders of the “in crowd” in business who are both demonstrating their proximity to power and enjoying good runs in their sectors. What these evangelists of a positive present and future forget to look at is the reality of our growing problem of inequality.

Business leaders can be short-sighted in their involvement in the government’s public relations drive. We are in this sorry mess partly because respectable business leaders gave credibility to the Jacob Zuma thieving scheme only a few years ago. Zuma did not become a corrupt president overnight. He built a foundation during his first few years, where normally open-eyed people took part in his poor arithmetic games. Within a few years, the system was bent to achieve its corrupt ways. While it was evident that the system was broken, business spent years, between 2012 and 2016, preaching parables about “positive narratives”.

There were a few reality checks now and then, but the captains of industry championed positivity. They went to investment conferences Zuma did not want. He even called them back from some.

Now, President Cyril Ramaphosa is no Zuma; he has given us no reason to suggest he would be corrupt like Zuma. 

But the fundamentals are still the same. We have a broken state. The state is the table on which the Ramaphosa Monopoly is played.

For example, almost all economic activity happens at the municipal level. Our major centres are falling apart. Eastern Cape municipalities have even stopped pretending: they dish out untreated water to consumers randomly. That is because there has been no investment in bulk infrastructure for years. Things are falling apart everywhere.

But our emperors happily sing Kumbaya, because their businesses are riding a good wave. The failure to deal with the structural issue – the failing state – blinds many to the fact that this wave will crash. 

*Mkoleli is lead partner at Mkokeli Advisory