Ramaphosa must get tough

Business Day - - OPINION -

To be an in­vest­ment des­ti­na­tion of choice, we need to re­solve the prob­lems that keep in­vestors away from our con­ti­nent.” Who would ar­gue with that state­ment by Pres­i­dent Cyril Ramaphosa at the Africa In­vest­ment Fo­rum on Thurs­day?

The pres­i­dent has been lauded re­cently for his pos­i­tive words, as even the scep­tics ac­knowl­edge that there has been a sea change from the Ja­cob Zuma years when busi­ness was treated as the enemy of the peo­ple, no dif­fer­ent to the way the pres­i­dent of the US views the me­dia.

Dial back to ear­lier in 2018 and the re­lief when it be­came clear that the next leader of the coun­try would not be some­one called Zuma.

That good­will, which saw the rand climb to mul­ti­year highs and the coun­try’s bor­row­ing costs drop, was then squandered by a gov­ern­ment that is still prone to mixed mes­sages and a lack of con­sis­tency.

Af­ter a pe­riod marked by im­prov­ing busi­ness and con­sumer con­fi­dence, the tone changed in late July when Ramaphosa de­cided to fall for the EFF’s pop­ulist trap and an­nounce that the ANC would seek to change the con­sti­tu­tion in or­der to ac­cel­er­ate land re­form.

In the fol­low­ing few months the con­ver­sa­tion was dom­i­nated by prop­erty rights and the rand duly went south.

So it was a sim­i­lar feel­ing this past week when fi­nance min­is­ter Tito Mboweni’s forth­right views on the fu­ture of SAA sparked a bar­rage of crit­i­cism from the ANC’s left­ist al­lies, who pre­sum­ably think tax­pay­ers should throw money at the air­line in­def­i­nitely.

Just like with Eskom ear­lier in 2018, when push came to shove, Ramaphosa and pub­lic en­ter­prises min­is­ter Pravin Gord­han chose ide­ol­ogy over hard, cold re­al­ity, leav­ing Mboweni iso­lated.

The year started with some op­ti­mism that de­ci­sions needed to put Eskom on a sus­tain­able path would be forth­com­ing. CEO Phaka­mani Hadebe may have been naïve in be­liev­ing that he could im­pose a pay freeze at Eskom, but the way that Gord­han forced him to fold at the first sight of re­sis­tance and vi­o­lence from unions was alarm­ing and brought into ques­tion whether the new board had the nec­es­sary po­lit­i­cal back­ing.

Unions will al­ways be con­cerned with sav­ing ex­ist­ing jobs rather than cre­at­ing new ones, so it’s not a ma­jor sur­prise that they would in­stinc­tively ob­struct any steps they see as a threat to the sta­tus quo, even if the ul­ti­mate cost of no ac­tion is bank­ruptcy for the coun­try.

A gov­ern­ment that just says we will keep throw­ing money at SAA, no mat­ter what, won’t in­spire con­fi­dence that it will take other tough ac­tions needed to get debt un­der con­trol.

The re­al­ity is that a fight with the unions is un­avoid­able. Let alone the eco­nom­ics, morally it’s im­pos­si­ble to jus­tify throw­ing money at SAA when hospi­tals across the coun­try lack ba­sics such as bed linen and painkillers.

Even the easy things haven’t been done yet. More than a month af­ter the jobs sum­mit promised im­me­di­ate mea­sures to kick­start the econ­omy, ev­i­dence of progress is scarce.

One of the high­lights was a vow to do away with Malusi Gi­gaba’s job-de­stroy­ing visa reg­u­la­tions that make it harder for tourists to come here, es­pe­cially those trav­el­ling with chil­dren. Still, there is no clar­ity, and an in­dus­try that ac­counts for al­most a tenth of out­put and sup­ports about 13% of to­tal em­ploy­ment is left in limbo.

While the home af­fairs min­is­ter might be dis­tracted at the mo­ment and should prob­a­bly be put out of his mis­ery sooner rather than later, the rest of the gov­ern­ment needs to get on with the job of trans­lat­ing the growth-friendly rhetoric into ac­tion.

IT’S IM­POS­SI­BLE TO JUS­TIFY THROW­ING MONEY AT SAA WHEN HOSPI­TALS LACK THE BA­SICS

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