Prove that business is a force for mutual good, Mr President
Is President Cyril Ramaphosa a businessman? If so, what kind? Does it matter? Should we care? I think it does matter. If there is one characteristic of the successive ANC administrations since democracy, it is a convoluted and somewhat debilitating relationship between the government and business.
During the Mandela years there was enormous goodwill but little true understanding of business’s actual needs, but it didn’t matter because everything was so much better than what preceded it.
Thabo Mbeki introduced regular meetings with senior businessmen, local and international — much to the ire of the trade union movement and radicals in the party. Yet Mbeki delivered the country’s best economic growth so far.
His rude ousting turned out to be a kind of lesson for the Zuma administration: don’t sidle up to business. The relationship with business turned inward and became corrupted, sour and discreet. It was no accident that this period also delivered some of the worst growth statistics in SA’s history.
A whole range of people openly hostile to business were given key economic posts, partly to satisfy labour and the radical left constituency that brought Jacob Zuma to power.
In this period, some of the noteworthy businesses that succeeded were not the ones chosen to succeed by the government — those involved mainly in manufacturing and beneficiation. Businesses that succeeded were mainly those with lots of market power and leverage, such as banks, and those out of the government’s reach, such as retailers. The other notable success area was betting on state failure, such as schools group Curro.
However, now we are in a different era, and it is difficult to see how it will unfold. Since Ramaphosa’s ascent there is a new mood in the relationship with business. Prominent pro-business advisers have been appointed, meetings between business and the government, without the civil society accoutrements, have been plenty.
Yet the picture is mixed, with government policies such as the Mining Charter and National Health Insurance legislation containing elements as threatening to business as any during the Zuma period. And the land legislation, social welfare legislation and expropriation legislation are all still in the works. All the anti-business ministers appointed by Zuma have kept their jobs, and the fundamental ideological relationship between the state and business is still hostile.
Senior and junior ANC members have been unable to recognise the fundamental truth the rest of the world long ago absorbed: business is a force for good. A positive business climate is crucial to a government’s very survival.
As regulator of the business environment, the government has an important role to play. That is often censorious of one or other aspect of business life, and it is proper that it should be so. However, if you ask your average ANC national executive committee member whether it is part of their job to create a conducive environment for business, the answer will be “no”.
Which is why the advent of Ramaphosa is so interesting. In some ways his personal wealth and that of his immediate family is distinctly negative for business, because he will always be in the invidious position of having to prove his common touch.
HE DOES SHARE A NUMBER OF CHARACTERISTICS OF BUSINESSPEOPLE; HE IS BOLD, PRACTICAL, STRATEGIC AND AMBITIOUS
And in any event, his business prowess is based on a mixture of attributes, one of which is — sorry, but there is no other word for it – rentseeking. Ramaphosa became rich through negotiation and arbitraging rules he himself was party to establishing.
That’s a slightly brutal description because he did, on occasion, put up what we might call real money. And he did sometimes lose it — a crucial rite of passage for any real businessman. The Lonmin disaster was not only a political headache for Ramaphosa but a financial one for his vehicle, Shanduka.
He does share a number of characteristics of businesspeople; he is bold, practical, strategic and ambitious. However, he lacks some characteristics too. One thing I have noticed after almost a lifetime of talking to businesspeople is how toughminded the good ones are. They love to show you what they have done and what they have built.
At the Kgalema Motlanthe Foundation conference in the Drakensberg on inclusive growth, Ramaphosa said in his speech: “If we are to liberate ourselves from the shackles of the past and the troubles of the present we must be prepared to dream.”
I think a business person would say to that: yes, well fine, but remember the immortal words of Master Yoda (slightly paraphrased). “No. Dream not. Do. Or do not. There is no try.”