Always look on the bright side of life…
THIS YEAR certainly started with a bang. One day you’re sitting on the beach drinking piña coladas and the next you’re wearing a power suit – and are back at work. Everyone I’ve spoken to is hopeful that 2017 is a darn sight better than 2016 or – for that matter – 2015.
Things are looking up. Retail sales are better – even though some say it may not last – some predictions are for better economic growth than last year. Some are for stagnant growth.
Hey, we escaped a downgrade to junk last year, we have actual rain now – although we may have La Niña to contend with – and commodity prices are looking up. So, we have those in our favour.
Whatever one may say, we have a sound judiciary, sound laws, and government institutions that will still stand up for consumers, even if it takes some time.
Yes, we’ve got a long way to go before we are the world’s chosen investment destination. Yes, our government institutions need some work before they are fully trusted – when was the last time someone spoke highly of logging a complaint about an estate agent and getting it resolved?
On balance though, SA Inc is a great place to do business, and to live.
(Although, I suspect, many people will wish to argue that point with me, despite me being – as my ex will tell you – apparently more a pessimist than a realist.)
The message South Africa’s delegation is taking to the 46th annual World Economic Forum (#WEF2017 if you will) is yet again that we are open for business.
Team SA – under the auspices of union-leader-turned-businessman-turned-politician Deputy President Cyril Ramaphosa – is meeting with potential foreign investors and selling the SA story. And we have much to sell, and much need to sell us, because we need foreign direct investment.
About 3 000 very important government, labour, business and civil society people converged on a small town called Davos, in Switzerland this week.
There, under the theme “Responsive and Responsible Leadership”, our delegation is pondering issues of climate change, millennials, the 4th industrial revolution, and wooing investors. Behind the scenes, they are more than likely succeeding. I hope so, because the limelight has been stolen by Chinese President Xi Jinping.
Xi has used the platform at Davos to call his “counterpart” US president-elect Donald Trump out on several fronts. It doesn’t help that Trump is conspicuously absent and probably preparing for his inauguration today. Xi is defending globalisation at a time when Trump is threatening, in more ways than one, to pull back the borders. China is also opening the doors to more foreign investors in a bid to entice them in when America’s borders are closing.
And, while he’s at #WEF2017, his country is preparing to retaliate if Trump carries out promises to impose sanctions on Chinese goods. It has already toughened its stance by imposing unusually high duties in an anti-dumping case against a US-made agricultural chemical. Ouch.
However, we have to remember that this comes in the wake of Trump threatening German car makers with penalties if they import into the US, Ford dumping a $1.6 billion (R21.62bn) planned plant in Mexico in favour of home, and assorted other infractions by companies that are not home grown – as it were.
This reminds me rather of Herbert Hoover’s pre-depression promises of “a chicken in every pot and a car in every garage”. Although less protective, insular, nationalistic – and let’s hope not jingoistic – Trump is beating about the same drum. (And no, I’m NOT that old, I just had a really good high school history teacher.)
It’s no wonder that China is taking on the world’s second largest economy in a bid to best it. America for Americans can only go so far. It’s not possible to totally close one’s borders and survive (don’t remind me about the 1980s when we had a thriving steel sector). And that’s why China is moving like it is.
I’m not arguing that some form of trade protectionism isn’t needed. Clearly, it is. However, whenever we think about our (economic) future, we need to have discussions with our arms open, not crossed.