Massmart’s Kuseni Dlamini on dithering and division ‘while Rome burns’
SA’s leaders are dithering and divided ‘while Rome burns’
● Without “decisive action and leadership” the recent looting and burning will become part of life in SA, says Kuseni Dlamini, chair of Massmart, which had to close 24 of its stores in SA and the rest of Africa because of the violence.
“We need much more visible leadership that in a very tangible way will provide direction, hope and unity, and take us out of this situation of chaos,” he says.
The only sustainable solution is economic growth, which the ANC governing alliance needs to put before party political interests and factional agendas.
“Economic growth has got to be the burning, strategic national priority. It’s the goose that lays the golden eggs. If there are no jobs, the burning and looting will get worse because people are unemployed and don’t have a stake in the economy.”
Outbreaks of xenophobic mayhem in 2008, 2015, 2017 and now are stark indications that government strategies have been entirely ineffective.
“We need strategies that work. And the only long-term strategy that will work is economic growth.
“It is indisputable that a lack of economic growth is one of the major causes of this problem. If our economy continues to stagnate, then the unrest is going to increase and get worse as people fight over ever more limited resources.”
Meanwhile, those who should be giving leadership are arguing about what label to put on the catastrophic riots that have shaken the country and where to lay the blame.
“To get into a semantic debate about whether this is xenophobia or criminality while Rome is burning makes no sense,” Dlamini says. “This is a time for decisiveness and building trust, not dithering about what to call it.”
Tough questions need to be asked about the country’s capacity to pull itself back from the brink, he says.
“We need to be honest about our capabilities to grow the economy to ensure law and order and secure our democracy. State capacity, a capable state that is able to deliver services, is at the core of what we need to look at and build.”
Institutions, processes and people across all sectors of society must be fit for purpose, capable and competent.
“It is time for us to wake up and ask some fundamental questions. We have pockets of excellence including our judiciary and a world-class private sector, but what is happening is an indictment on the collective capacity of the country’s leadership.”
Business needs to play a “far more robust role” in capacitating the government, while the government needs to acknowledge its limitations and enable business to play this role by providing the kind of direction and policy certainty only it can provide.
“Business leaders need to be more engaged with helping to build capacity within government, and sharing resources and expertise. They need to communicate more clearly and effectively to government what their expectations are, and government needs to listen, engage with business to find solutions, and act.”
According to a PwC report at last week’s World Economic Forum Africa summit in Cape Town, African CEOs are more confident about economic growth than their global peers.
Dlamini says he shares this confidence. “Looking at Africa’s projected economic growth rate of more than 4% one has to be confident about growth prospects. There are huge opportunities, but we need African leaders to really start unlocking the constraints to higher growth.”
The signing of the African Continental Free Trade Area agreement creates an opportunity to do this.
But Dlamini warns that unless SA changes direction soon, it won’t be part of the growth about which African business leaders are so confident.
“SA will have to work hard not to be left out of this growth story. This means addressing unemployment and inequality.”
There’s no shortage of opportunities in the energy sector, in the digital space, in retail, in telecommunications and in mining, Dlamini says.
“But we need to create the right environment, we need policy certainty, we need institutions that are trusted by investors and that work, we need to win the hearts and minds of foreign investors so we can capture our fair share of the global growth pie.”
The big problem is time. At an investment conference he attended this week, Moody’s said the country was safe from a credit ratings downgrade to junk for the next 12-18 months. But SA shouldn’t be lulled into complacency by this, says Dlamini.
“We have no more time. We have to act right now. The world is not waiting for us. Countries are competing fiercely for investments and positioning themselves as attractive places for investment.”
But not SA. Its anti-immigration mentality, so bloodily highlighted by the current wave of xenophobia, seems calculated to discourage investment and further cripple the economy.
“It is incredibly short-sighted to think a country can progress without the contribution of people of different nationalities and skills,” he says.
“Skills contribute significantly to the economic development of nations, and investors come to places where there are skills.”
In spite of all the talk, SA still doesn’t seem to take the need for investment seriously, judging by its failure to create the right conditions for it.
The response within the governing alliance to finance minister Tito Mboweni’s recent “very helpful” economic paper made it alarmingly clear that they’re still all over the place when it comes to economic policy.
“It is important that the governing alliance has a coherent policy position on managing the economy so they don’t keep sending mixed messages to the investor community and to society at large,” he says.
“This is a time when we need a united voice from our leaders on policy, on how to grow the economy. Because disagreements within the governing alliance are affecting investor sentiment both in the country and abroad.
“The country cannot afford to have a governing alliance that shows no unity of purpose. This is not the time to be divided on what to do to grow the economy.
“It’s time for leaders to put the country’s interests first. To play political football with the economy is very unhelpful indeed.”
We need a united voice from our leaders on policy, on how to grow the economy Kuseni Dlamini Massmart chair