Political change is also the business of business

This past week I spent a few hours visiting an innovative South African agri-technology business that is well on its way to becoming a global player. I was blown away by the knowledge and technology they produce, and their approach to solving problems. I left filled with pride and optimism, not only at what they achieve but at the diversity of the staff — and the inspiring personal stories of many of them. It made me remember that our country can achieve just about anything it sets its mind and collective effort to.

The management also told me about the challenges they face. They said revenues are good, but margins are incredibly thin. Some months the margin is wiped out entirely — by Transnet bottlenecks. These necessitate that they fly in product already on our shores because our ports and rail system are operating sub-optimally. I could tell they were trying to be as gentle as possible in describing the problem after having me on a high.

Another business complained about the poor quality of our roads and their impact on freight delivery targets, and the millions of rands they spend on tyres shredded by our pervasive potholes. The impact is that these businesses move from being able to grow to just making it, or worse. The lost margins could easily fund expansion and more jobs and training, but they go towards subsidising the state for its failures.

One business is in Tshwane, which is experiencing serious decay at present (I live there), and whose city council may or may not last. The other is in Johannesburg, which is on its umpteenth mayor since the November local elections. The political actors in both places either have insufficient or no time to govern.

My encounter with the first firm came less than a week after the Reserve Bank hiked interest rates by 0.75%, the same as the US Federal Reserve in early November. The decisions followed a similar move at the end of October by the European Central Bank (ECB) — the EU being another major trading partner of South Africa.

China kept its interest rates unchanged, with monetary policy officials wary of loosening lending in a global wave of inflation. China is now South Africa’s single largest trading partner.

The South African economy is expected to grow by 1.7% this year, not enough to make a dent in unemployment and poverty. Whenever the Reserve Bank hikes interest rates, it kicks off an angry discussion about its mandate, which apparently needs to be “expanded to include job creation”.

As someone who supports numerous unemployed people in one way or another every month, I would love to live without this responsibility. Every South African deserves a decent job that enables them to build a healthy and comfortable life.

That said, the real constraints to economic growth are almost entirely political in nature.

In a parliamentary presentation in October, the department of basic education put the school dropout rate at 48%. These are young people who do not have the tools with which to find a decent job in any event because they are unskilled. Many of them are also likely to not have an identity document because matric exam registration usually triggers an application.

Decaying and collapsing municipalities, the localities in which every business is located, are also a significant constraint to growth, as are Eskom and Transnet. I could go on endlessly.

In places such as Mthatha, violent crime is so prevalent that owning a business that processes cash transactions is a life risk. It does not help that infrastructure has crumbled due to poor administration, corruption and petty politics. It is nearly impossible to find a decent new job.

For most of this year the most prevalent political discussions have been musical chairs in metro councils, the Phala Phala scandal, or the ANC’s step-aside rule and its impact on its thoroughly mediocre leadership candidates. Television stations do live crossings and run around the country doing wall-to-wall coverage of these “leaders” insulting judges, accusing one another of corruption or defending those who have been arrested for it.

While I know that most ordinary people who face survival challenges every day find this spectacle depressing and angering, I always wonder what goes through the minds of businesspeople who oversee large corporations. Do they hope that somehow, miraculously, things will improve? Or have they become so used to the rot they budget for it, and lower their growth expectations?

Are they happy to take the occasional torrent of insults about an “investment strike by private capital”, where, apparently, they are not investing in the future because they want to spite South Africa? After all, it appears to have become our staple to believe in magical solutions where, if there were more investment or a different monetary policy, Transnet and Eskom would improve and city councils would be run better.

My recent experience is that the owners of small and medium-sized businesses are more likely to call a spade a spade, that our economic problems are largely political. They also are more likely to state that things will not improve until the politics do and there is a new set of capable hands at the Union Buildings, in provinces and in municipalities. They take this stance usually because they do not have pockets deep enough to cushion themselves from the chaos, so it is an existential issue for them.

However, I remain optimistic that we can still realise our country’s enormous potential because of the growing number of people willing to work for the change they want to see. In recent months I have found that South Africans of great expertise are willing to reimagine our country in collaboration with compatriots from all walks of life.

They are in sectors ranging from economy, crime and justice, public health and skills training to infrastructure development and community development. These are people who have decided to turn their anger and disappointment into imagining a future built on the bitter experience of the past 40 years.

Last Saturday, a diverse community of South Africans numbering in the hundreds decided to call on their compatriots to rise collectively to the challenges facing our country. They decided to build a social and political movement drawing on their collective experience, talents and expertise to change the country’s politics in 2024, and to embed a culture of voluntary community service.

The Rise Campaign began in earnest last week, and I am delighted that among those who have volunteered are talented, often young entrepreneurs who are putting it all on the line for the future they know they deserve. If we are to grow our economy and create the jobs South Africans need, it is difficult to see how for the first time since the Rubicon speech business does not once more accept that political change is also the business of business.

The real constraints to economic growth are almost entirely political in nature