SA desperately needs decisive leadership

A very short, but significant, news report this week provided a glimpse of the worst of the year in closing.

Reporting on 2017 company tax figures released by the South African Revenue Service, the report said 48.3% of companies had no taxable income in 2017, while 27.4% registered losses for that year.

While these are 2017 figures, South Africa’s gross domestic product declined from 1.3% in 2017 to about 0.7% in 2018. It is forecast at 0.5% in the outgoing year.

This portends a concatenation of negatives for the coming year: worsening prospects for employment, a further decline in government revenues, widening budget deficit and borrowings.

For a country with unacceptably high poverty and inequality, this means the poor will get poorer and the dividends of democracy more elusive. The question, what is to be done and by whom, has never been more urgent.

In May, one opined on tasks which then newly elected President Cyril Ramaphosa could not avoid addressing in concert with social partners and the broader society.

These ranged from internal (ruling) party politics; the economy; unacceptably high levels of poverty, inequality and unemployment; prudent fiscal management; the rehabilitation of state-owned enterprises; promoting a committed, skilled, professional and ethical public service at all three spheres of government; an urgent examination into the efficacy of our schooling system; and the (mis)management of our country’s diversity.

Also included was cultivating an active citizenry imbued with the civic spirit akin to that which obtained, in the 1970s, the reconstruction of South Africa’s international role to rekindling and sustaining public discourse on issues of social morality and ethics.

Many of these issues and more are admittedly a work in progress, perhaps a fluctuation of pluses and minuses which require constant scrutiny. But there are some uncomfortable truths to be said.

Prominent among them is the seemingly uneven level of appreciation of the depth of South Africa’s socio-economic crisis and the urgency with which we need to respond.

For starters, the ruling party continues to speak in discordant tones on vital matters such as the economy and the promotion of a cohesive society, in which there is one law for all South Africans regardless of party-political membership.

For, let’s face it, the industrious and sometimes seemingly enthusiastic output at cross purposes has consequences.

Even if particular incidents are nothing but a scarecrow, tactical positioning or an inconsequential skirmish, they have the unintended effect of communicating a message that there is no agreement on the important issues of the day; in which case the status quo remains until the ruling party searches and finds consensus.

In a plural society, and as would be the case, in a dictatorial society, this must naturally impact on the party’s standing in the estimation of sections of the population and a finicky local and international investment community.

Similarly, the posture of business and labour exudes a môre is nog ’n dag (tomorrow is another day) approach in which cooperation is only mouth-deep, compromise impermissible at best, and an aberration at worst.

Since 1994, the South African corporate sector has consistently rationalised its inadequate record of investment. The avalanche of post-apartheid labour laws became the standard refrain for inadequate investment.

In fairness, business has raised other legitimate issues, such as the ease of doing business and the telecommunication costs which are still to be adequately addressed. But the overall macroeconomic fundamentals throughout the 25 years of democracy have largely been business-friendly.

There are some fundamental philosophical questions to be posed and answered, including whether South African business considers a nonracial democracy in its interest and how, given the country’s historical evolution, it should support it in its own and the national interest.

Once more, in fairness, there is much that is unsavoury about the past 10 years. But in there is frankly a sense in which it has provided a perfect excuse for the lacklustre investment record, not to mention the irony of ironies, which consists in the fact that a cursory glance at its genesis illustrates a degree of acquiescence, not only from business, but also sections of the chattering classes.

What about the R4 trillion cash reserves on which South African corporates are sitting, an abnormality compared to economies of similar size? Whichever way business assesses its posture it is, in the long term, self-injurious.

Organised labour, on the other hand, continues to undercut the interests of its constituency by failure to innovate on its socioeconomic demands under the current economic climate. There is the thorny issue of worker trustees in pension funds.

To what extent do the investment mandates of the fund managers entrusted with workers’ pension funds reflect the developmental concerns of the trade union movement? South Africa’s leadership across the sectors and divide needs an urgent change of gear in order to rally the nation and the world to save the country from the crisis.

There is a lot to learn from the deep thinking of Deng Xiaoping, China’s post-1978 leader who, though not a sovereign messiah, did much to transform the country from a peasant society in the late 1970s to the world’s second-largest economy today. 

Ratshitanga is a consultant, social and political commentator.

-mukoni@interlinked.co.za

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