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President Cyril Ramaphosa
South Africa in 2030…. Three scenarios
21 June 2018, 1:15 PM

President Ramaphosa will on Thursday address a gathering of academics and business leaders on different future prospects of how the country could look in 2030.

In the past year, a group of thought leaders and academics have produced a document that seeks to help the country work on a positive plan that will help it work towards an economically viable future.

Spearheading the project is University of Johannesburg Professer, Somadoda Fikeni, who says the document titled South Africa Scenarios 2030, Indlulamithi is “a tool to enable the nation to have strategic conversation about the future.”

President Ramaphosa has welcomed the initiative: “Any nation that seeks progress and development must be able to first envision it. The Indlulamithi Scenarios help the country understand the possible paths it can take, and what needs to be done now to ensure that it takes the path of greatest cohesion, prosperity and equality.”

Fikeni says the project is in line with the National Development Plan and United Nations Sustainable Development Goals. “2030 seems to be a reasonable periodisation part, though it should not limit us to look beyond 2030.”

The document looks at three possible scenarios for the country going forward, focusing on issues of inclusive economic growth, the quality of education, social cohesion and issues of security in the country.

One scenario foresees a gloomy picture with a projected economic growth of 1.5% per annum, whilst the two other scenarios are more optimistic.


For more on this, listen to the interview with Professor Somadoda Fikeni below:

See a summary of the three possible scenarios below:

 

Instagram and Pinterest.At the same time, both video and infographics have become powerfultools for brands looking to communicate more easily with their readers. by SABC Digital News

 

 

 

Soweto Theatre sign
Soweto Theatre highlights youth struggles through drama production
13 June 2018, 8:05 PM

The Soweto Theatre will use youth month to further develop the arts by commemorating the story of the June 16 uprising with a drama production.

The production titled: Commemoration, a celebration of Bravery and Defiance, looks at challenges faced by today’s youth like unemployment, drug abuse and lack of access to education.

Bravery and Defiance focus on the events around the 2016/17 Fees Must Fall movement and how those protests continued the struggle of the 1976 youth.

For more on this story watch video below:

DA exposes SAPS members criminal convictions
8 May 2018, 9:22 PM

An administrative bungling has caused police officers to receive criminal convictions. A DA parliamentary question revealed that 57 members of the Family Violence, Child Protection and Sexual Offenses units across the country have criminal records.

Now the national police commissioner has given a directive that the police human resource management must clean up the system following a departmental investigation.

One of the biggest police stations in Mangaung is being visited by the DA Shadow Minister of Police, Zakhele Mbhele.

The focus was the Family Violence, Child Protection and Sexual Offences unit, to inspect whether it is adequately resourced and staffed.

But most importantly to look into the issue of police with criminal records.

 DA Shadow Minister of Police, Zakhele Mbhele says “Obviously our concern is that no member should have a criminal record  but where there has been  glitch in the system there must be recourse for them not to have the stain on their name.”

It’s a matter that is already receiving attention in the police management.

National Police spokesperson Vish Naidoo says “We need to put it in context. Our organisation members use state vehicles and immediately when they involved in a motor vehicle collision a criminal case is opened because the vehicle belongs to the state. And where the members are found to have acted negligently then those members are convicted.  There are cases where the criminal conviction should have been expunged and they haven’t really been expunged.”

For those members with more serious cases – internal disciplinary processes are expected to take place.

ANC calls for Maluti A Phofung mayor to go
8 May 2018, 7:53 PM

The ANC in the Free-State says factions within the party have led to the collapse of services in the Maluti A Phofung Municipality.

According to the ANC provincial task team coordinator William Bulwane, the decision to recall embattled Maluti A Phofung Mayor Vusi Tshabalala, Chief Whip Mmoledi Moloi and the Speaker Malewatle Nthedi is to benefit the party.

Earlier, this year the municipality was placed under administration. A decision has been made to recall the mayor.

The ANC says the decision has been motivated by wanting to restore political stability.

Free State ANC coordinator, William Bulwane says “Those divisions amongst them they were making sure that they divide the structure of the ANC but also the community, that’s why we intervened.”

Meanwhile, the EFF welcomes the recall of the Mayor. EFF caucus leader, Mahlomola Majake says “We as EFF are happy about the removal of the mayor. At least now the ANC has listened to the complaints of the community even though they took long.”

Earlier in the year there were protests in the municipality, see video below:

 

SA should welcome BHAG to attract a minimum $100bn: Mbele
19 April 2018, 1:22 PM

After all the noise and arresting the leakages (across all government sectors & SOEs as well as in businesses), a winning game is premised on attracting domestic and foreign investment for economic growth and job creation. This is what South Africa should be aspiring to.

On Monday, April 16, 2018 President Cyril Ramaphosa prior to leading a South African delegation to the Commonwealth Heads of Government Meeting (CHOGM 2018), held in London, launched an ambitious new investment drive aimed at attracting $100b over a 5 year period. A four-member team, “a special envoy”, consists of credible, heavyweight individuals will be travelling the world to build an investment “order book” in preparation for investment summit planned for August/ September this year as part of fulfilling his 2018 State of the Nation Address 2018.

The envoy will be supported by a highly capable, Ms Trudi Makhaya who was announced as his economic adviser. Among her immediate responsibilities will be the coordination of the work of these Special Envoys and a series of investment roadshows in preparation for the Investment Conference.

No sooner had President Ramaphosa touched down in London, South Africa received the news that President Ramaphosa and British Prime Minister Theresa May agreed on a deal worth £50m (~R860m) new UK funding across the next four years to help South Africa improve its business environment, to make it more attractive to investors including in the UK, and ultimately lift some of the poorest people in South Africa out of poverty by creating jobs and opportunities.

This R860m aims to help identify and dismantle barriers to trade within Africa and beyond, creating a wealth of opportunities for UK business over the coming years, millions to help South Africa improve its business environment. Clearly, the man is in a mission and he knows what he is doing. He is not only “sending people”, he is doing it himself. Everyone is energised which was clearly evident when Jacko Maree, (one of the 4 member team of the special envoy), decided to drop everything and joined Ramaphosa on the trip to London – at a very short notice.

$100 billion is a Big Hairy Audacious Goal (BHAG) though President Ramaphosa insists that this is a minimum and we should strive to over achieve. In today exchange, President is asking for R1,198,305,543,110 or R239,661,108,622 per year for 5 years in new (foreign) investment. These numbers have not been seen, certainly not in recent times. There are a number of reasons why Foreign Direct Investment (FDI) has seen a slow growth in South Africa – and other parts of the world, of course. Internally, South Africa has been affected by a dramatic slowdown in key goods-producing sectors, mainly in the mining and manufacturing sectors.  Like many countries, after the global recession of 2008/9, many of our economic sectors experienced a sharply reduced domestic and export demand levels. Technological innovation has also seen labour intensive sectors suffering the worse while services have seen formidable growth.

Our economic performance largely depended on commodity prices, thus the fall of commodity prices, what others have called “the end of the commodity super-cycle”, exposed our lack of or limitation of diversification in our economy. Our problems were compounded by other scourges of corruption, state capture and poor policy-making.

The two greatest derivers for growth are fixed investment spending and export-led spending.  It is common cause that neither made much more than a cameo appearance in the Zuma’ years. The consequences of Zuma’s irrational presidential era are largely to blame for our regression. His tenure can best be described as in the following manner: lack of investor confidence and lack of actual, productive investment into our economy; growing political uncertainty, unwillingness by lenders in capital markets to finance the ever-increasing debt by state-owned enterprises through bond purchases or even new loans and ‘culture of no-consequence’ for the blatant abuses of public resources.

At one stage, National Treasury made a damning confession: “Policy and political uncertainty remain central risks to the domestic economic outlook. Elevated policy and political uncertainty, coupled with weak confidence, discourage investment and consumption,” they blatantly confessed. The cancers of corruption and state capture remain undefeated, thus still present a miasma.

The South African economy desperately needs Foreign Direct Investment (FDI) that is grounded on building bricks and mortals. Unlike Foreign Portfolio Investment (FPI), “hot money”, FDI is a cornerstone of meaningful, economic growth. We are already well placed for FPI as we pride ourselves with sophisticated capital and bond market, world class stock exchange, renowned derivatives market. While FDI flows tend to be volatile (as data from UNCTAD and SARB can confirm), the uncomfortable truth (reality) is that FPI is more “unstable” as it can leave as hastily as it comes. Thus, it is “insufficient” to only rely on FPI. Our economy needs to create jobs and transform at the same time.

However, few fundamentals need to be in place to attract the much-needed FDI, and no doubt, the special envoy should be prepared to provide credible response to the questions. Chief amongst many questions would be to demonstrate the following:

  • Does South Africa has a strong rule of law?
  • Do we have a predictable, certain and enabling regulatory environment? [Legislation that promotes both domestic and foreign investment.]
  • Does the South African environment provide a progressive tax system that supports inclusive growth objectives?
  • Is our economy transformed or transforming and inclusive enough to create sustainable employment?
  • How about our capacity and capabilities to meet the requirements of potential investors?
  • Does the country’s infrastructure support growth?
  • Is the energy policy in place to target economic growth with secure base-load electricity at a comparative possible price?
  • Are there plans in place to restructure country’s state assets, which are performing badly and or non-core?

 

President Ramaphosa correctly bemoans the fact that our investment rate falls short of creating an inclusive economic growth that is required to create jobs. This economy will forever remain in a state of paralysis if our investment rate hobbles around 17% – 18%. The self-inflicted damage has ensured that we regressed from 24% – 25% investment rate last seen in 2008 to current levels of 18% (of our GDP). With this BHAG – and local investment, our economy requires 30% investment rate.

In the world of investment, it is important to provide “Reasons to Believe” (RTB), and President Ramaphosa stated that the team will be communicating a clear and consistent message – that South Africa is an investment destination with significant unrealised potential.

Amongst the RTB, he cited the following as the strength of our offering:

  • A thriving democracy, an independent judiciary and strong institutions.
  • An advanced and diverse economy, a sophisticated and well-regulated financial sector,
  • Extensive transport, telecommunications and energy infrastructure.
  • A youthful (multi-talented, multi-ethnic indigenous) population, an improving basic education system and significantly expanded higher education enrolment.

He conceded that investors might require ever more RTB’s, thus the team should be prepared to brief investors on the measures we are undertaking to improve the investment environment.

We should embrace the efforts of the current administration as, within the space of 3 months, we have seen positive movements in the following:

  • Progress in bringing to books the architecture of state capture,
  • Credible attempts to stabilise strategic state owned enterprises,
  • Improving the functioning of key institutions like SARS,
  • Cooperation to finalise a new Mining Charter through consultation with all stakeholders,
  • Processing legislation for the implementation of the National Minimum Wage and the promotion of labour stability,
  • Signing of IPP by Minister of Energy, and
  • Launch the Youth Employment Service to increase the employability of first-time job seekers.

A lot still needs to be done but progress is underway. Investor confidence tends to respond positively to demonstrably signals of progress. We need quick, big wins. This would feed to the growth in business confidence, which we have seen over the last few months, confirmed by the strengthening of our domestic currency, improvement in investor outlook and improved growth estimates.

With a little bit of careful planning and hard work, the BHAG is attainable. Extra work by the team might even produce FDI that is outward-looking thus giving our economy export- earning, foreign revenue, reducing our foreign exchange deficit. These would be an upside to job creation, improvement in personal income tax, corporate taxes, creation of new industries and consumers as well as reduction of the deficit gap.

Let’s unleash our pack of lions while our local companies are also coming to the party as well.

 

About the author: Sizwe Mbele, Director of Strategy: Business Leadership South Africa.

Sizwe Mbele with President Cyril Ramaphosa. (BLSA)

Highlights

 

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