ANC bickering strangles SA growth, says Investec CEO

Infighting among SA’s political leaders instead of promoting business-friendly policies risks keeping SA mired in recession, according to Stephen Koseff, CEO of Investec Plc.

The ANC’s being divided by corruption scandals surrounding President Jacob Zuma, his ties to the Gupta family and a contest for who replaces him as ANC head in December. Government policies are also raising concern with the mines minister last month releasing new rules that are being challenged in court by the industry and last week freezing the granting and renewing of mining rights.

“There’s so much political noise out there, no one is concentrating properly on the economy and what needs to be done to get it growing,” Koseff said on Friday.

Investec is focusing on ensuring it has the right clients and remaining cautious on lending to cope with the slowdown, the CEO said. It will focus on growing existing businesses, while rolling out insurance to customers in SA and a new online product called Click & Invest to individuals in Britain who have over £10 000 to invest, he said.

The Reserve Bank lowered its interest rates for the first time in five years on Thursday in an effort to stimulate the economy, which it forecasts will expand only 0.5% in 2017. There’s room for at least one or two more rate cuts as the rand’s strengthened almost 10% against the dollar over the past year and inflation’s within Sarb’s 3-6% target range, Koseff said.

Taking advantage of export zones where employers could attract contracts by not being subject to minimum wage rules, or by promoting industries in tourism, computer coding and service jobs, would instil investor confidence, increase consumer spending and boost the economy, he said. Otherwise, it could mean SA would eventually have to rely on an International Monetary Fund bailout.

“You might as well do the right thing before you get to that point,” said Koseff. “It’s actually not that hard to shift direction. You just have to understand that you have to be a lot more business-friendly.”

There’s so much political noise, no one is concentrating properly on the economy and what needs to be done to get it growing. Stephen Koseff Investec CEO