What to do to get us out of the mess
With the prolonged Covid-19 recession continuing to bring uncertainty to credit markets, risk appetite among South African investors continues to be low, with some demanding a much higher risk premium for low-rated bonds. Supply has been very muted in 2020, as companies do not have a lot of funding needs for investments in a recessionary environment and some weaker companies cannot refinance in public markets.
The rally in mining commodities has marginally improved the macroeconomic situation via improved terms of trade. With the current constitutional, political, economic, health, unemployment and gender-based violence crises, SA is in a state of war, if not worse.
Africa’s once biggest, most sophisticated, largely extractive, diversified and resilient economy with the strongest private sector has lost its shine, purpose and true north. For the economy to get not to the old, nor the new, but better normal, many things now need to be done simultaneously, concurrently and in parallel — pretty much like building a plane while flying it.
The trick is to accept that we cannot fix everything. We can’t keep analysing and eloquently talking about the problems. What is needed now is concrete solutions. Even after consulting, there comes a time to decide and, most importantly, to do. It will need all the social partners and the convening power of faith-based organisations working in concert, on the same things, pulling in the same direction, for the same ultimate objective and the same story — like synchronised swimming.
Because among ourselves, we know the issues, we have all the answers and tools we need. We must agree on big things and stop bickering about small ones — a coalescing of the rational centre.
But where we still have not succeeded, among others, is in safety and security, health and education. The economy is in disarray, we now find ourselves in a parlous financial state; governance has collapsed; electricity supply is inconsistent, unreliable and unstable. The much-needed dialogue towards a national compact for national action has not yet materialised.
As in most African countries, our leaders shun the public institutions, hospitals and schools, depriving themselves of the opportunity to personally experience these public services in the execution of their primary responsibility as public servants. Elevating themselves above the very people they are meant to serve instead of living with them. Unless one knows what is happening on the ground, one is clueless and rudderless. You can’t fix what you don’t know. They are alienated and unable to lift their own people, who are still without opportunities, jobs, money and food.
Under such a dire state, people often gravitate towards charismatic characters. Unwilling to do what we have to do, when it needed to be done, the result is pedestrian economic growth, stubbornly high unemployment, increasing poverty, the highest rate of inequality, poor service delivery by an unresponsive and weak state, short-term thinking, lack of continuity, and low voter turnout, among others. Starting and doing business in SA is too complicated.
So, what needs to be done?
All the social partners must commit to action, dedicate resources, put action plans in place, determine deadlines to realise the goals set out in the state of the nation address delivered on February 12 2021. There, President Cyril Ramaphosa distilled and synthesised these into “four foremost, overriding priorities”: to defeat the coronavirus pandemic; accelerate our economic recovery; implement economic reforms to create sustainable jobs and drive inclusive growth; and fight corruption and strengthen the state.
We need a compelling vision driven by nimble, responsive and accessible leadership that will deliver, not promise, inclusive socioeconomic growth and transformation. Not either/or, but both, together and at the same time.
The biggest injustice is exclusion. The majority of black people and women have not personally benefited from the democracy dividend. We must start with what we have, not what we wish we had. We need a much more, not less, assertive redistribution strategy. Because we have not succeeded in changing apartheid spatial planning, most black people are still unable to save, with transport gobbling up no less than 40% of their already meagre salaries. This goes up to more than 70% when you add the cost of food.
We must be insistent and persuasive in demanding that we send some top state capture miscreants to prison; secure enough vaccines as a matter of life and death — vaccine rollout has always been a race, as the first country to achieve herd immunity will benefit from the pent-up tourism demand. We must execute on the longpromised deep systemic socioeconomic reforms;
reduce the soaring government debt; fix the more than 740 state-owned entities; increase our infrastructure spend; execute on the 10-year-old digital migration and spectrum auction as it is now underwhelming when SA says it is going to do anything; focus on GDP growth; create jobs in large numbers for outsized and oversized impact, and fix the quality of our educational system.
We therefore, for emphasis, demand ethical leadership, which by definition will give us absolute transparency and final accountability. The constitution of the Republic of SA says we must create a public service that must loyally execute the lawful policies of the government of the day [section 197 (1)].
Further, employees of the public service may not be favoured or prejudiced because they support a particular political party [section 197(3)].
More importantly, section 195 (1) of the constitution spells out the values and principles that must govern public administration. These include a high standard of professional ethics, effectiveness and efficiency, and a responsive and development-oriented public service.
There comes a time to decide and, most importantly, to do
✼ Mohale is the chancellor of the University of the Free State, professor of practice in the Johannesburg Business School College of Business and Economics, and chair of both the Bidvest Group and SBV Services. He is author of the bestselling book Lift As You Rise