Trade and Industry Minister Rob Davies does not understand business when he says he is not worried by a weak currency. Yes, perhaps this is valid in textbooks and in countries which have a productive workforce and a tradition of export competitive pricing.
What happens here when the rand drops is that exporters shove up the price and enjoy extra profits while it lasts. This is because they do not have the right labour and do not have the inclination, management skills, business confidence or work ethic (as one sees in the East or Germany) to take advantage of a weaker exchange rate, whereby they can make more money by increasing volume sales.
Furthermore, Davies is wrong when he says the weaker rand will keep out “undesirable” imports, whatever those are, because those imports are either not available in South Africa, or just because people will want them and will have to pay more.
Inevitably what happens is that within months the effect of increased labour settlements (because workers see factories are busier) and increased imported inputs lift prices again, and everybody is back to the same point; except we have more inflation and new demands to weaken the rand again.
As far as his contention that he has not been asked about labour chaos or ANC anti-investment attitudes, one can only assume that those who have the questions already know the answers and the response expected from an ANC apparatchik, on past record, would not take the matter forward. In short, academics, especially those who operate on Marxist principles, should not be anywhere near economic portfolios.
Anglo American is in a class of its own
I am in praise of the Anglo American corporation. Born in Johannesburg in 1936, I am a South African Anglican. My forebears arrived from England about 100 years ago. Some, I suppose, would call me a colonial and I would not have a problem with that.
I was delighted to read Keith Bryer’s piece (Business Report, January 27) in which he responds to the Bench Marks Foundation attack on the mining industry and on profit-making in general. It was high time the verbose cleric who represents the foundation was put in his place.
I worked for Anglo American from 1970 to 1979. It is a humane, excellent employer and has been a great agent for change in southern Africa.
I was in South Africa and Zambia during those interesting years. It was a time of importance to our future, which seemed gloomy then. I was privileged to meet Harry Oppenheimer, Zac de Beer and Gavin Relly and to work under and alongside Vernon Weber (the managing director of Anglo American Central Africa) and Tommy Reid (personnel manager of Anglo American Central Africa).
At that time Anglo involved itself in an active programme of fostering change by encouraging influential white South Africans to accept the inevitability of change and the end of apartheid in South Africa, and influential white Rhodesians to accept the coming end of white rule in Rhodesia. The “Anglo Jet” performed a shuttle service between Johannesburg and Lusaka, bringing together both sympathisers and sworn opponents for “get-to-know-you” meetings.
It is only a mild exaggeration to say that our ANC government has Anglo to thank for where they are today. I heartily salute, regrettably mostly posthumously, those arch-capitalists Oppenheimer, De Beer, Relly, Weber and Reid and I hope the verbose bishop reads this, puts it in his pipe and smokes it.
Ministry intervention leaves negative taste
Your story “Amplats delay expected to hurt more than help” (Business Report, January 29), refers. I am surprised to read that it took the Minister of Labour, Mildred Oliphant, to intervene to allow 60 days of consultation. If the unions were doing their job this would not have been needed.
The Labour Relations Act allows a referral to the Commission for Conciliation, Mediation and Arbitration to be done.
Should any one of the consulting parties request the commission to appoint a facilitator to assist the parties then the commission must appoint that facilitator.
This in essence means that an official government-appointed facilitator will conduct independent facilitation for a period of 60 days. If the unions, either the National Union of Mineworkers or the Association of Mineworkers and Construction Union, were awake they would have referred this possible retrenchment to the commission.
It appears that the unions have lost sight of their duties and are letting the workers down badly.
Furthermore, the intervention of the ministry gives an incredibly negative perception to the business community, who are now obviously thinking twice before they invest in the mining environment.
Success should inspire CAs to take the test
The preponderance of chartered accountancy graduates among the uber rich in South Africa’s business fraternity is encouraging news for recently-graduated B.Comm students, who are at times undecided whether to take up the tough board aspect of that degree.
Led by master entrepreneur Whitey Basson of Shoprite, the findings highlight the earning prowess of these elite men and women, courtesy of a South African economy that has grown, thanks to open markets, and penetration into Africa, and the world, by some companies.
Buoyed also by indigenous population growth, and boosted by great numbers streaming in from neighbouring countries: some to settle, others to take back goods for resale, the country has seen a spectacular increase in retail sales, with Basson’s empire the market leader.
A R Modak
Cheat at my golf club and you’re in trouble
Liza van Wyk’s article, “Fair Business” (Business Report, January 30), states that according to a survey, 20 percent of business executives would let a client beat them if they thought it would get them more business and 82 percent of executives admit to cheating on the golf course.
I am not sure where the survey was carried out, hopefully not South Africa, but if a member at my golf club was found to be cheating at golf, he or she would have to appear before the disciplinary committee with the probability of having their membership terminated.
It is, however, commonly said that anybody who cheats on the golf course will cheat in business and anybody who cheats in business might cheat on the golf course. It does not say very much for the ethics of business.