At what point does business take some responsibility?
Analysts are accusing government agencies of bureaucratic delays that are costing the country billions on a daily basis and thousands of jobs. This is off the termination of sale by Aquarius Platinum of its two assets, one of them being “Blue Ridge” to a Chinese consortium.
This has been a great concern for government. How far does government go in protecting and expediting these kinds of investments and acquisitions that are effectively not building anything new?
How far do we go in protecting investments that may help the balance of payment in nominal terms and the financial investments side of it, but are not resulting in any real growth, no new plants being opened, no new employment, no new branches being put up increasing car manufacturing and upskilling people?
Why would inconsequential foreign ownership of our companies be rushed by the government?
It is not clear for example what a Barclay’s Bank buying Absa benefited our country in real terms, except a note on our balance of payment as a foreign direct investment.
Absa did not suddenly have a new financial appetite to expand and open new branches and employ new people.
Putting up our companies for sale to foreigners has proven of no clear benefit for our people and only negatively serves to give us an exposure in the ever risky international market to our detriment.
The accusation therefore by business that government is slow in approving certain deals which is hampering job growth is not only convenient amnesia, but it’s plain silly. Business has never cared about job growth and they cannot use that to manipulate government to blindly approve another series of local companies being bought by foreign owners with no clear benefit to anyone else except corporate executives and shareholders.
There is one request we have always made to business. Business has to adopt a sense of “shared destiny” in the manner in which they conduct business. Business have always been so eager to mechanise, to downsize, to offshore to where labour is cheap and to outsource so as to absolve responsibility and cost.
They cannot wake up today and claim that they are concerned about jobs and government is standing in the way of jobs by delaying approval of certain transactions.
South Africa has had 10 years of uninterrupted economic growth before the economic crisis of 2008, growth which was characterised by unprecedented returns for companies and their investor shareholders, quadrupling salaries for company management and growing per capita incomes for the country rivalling that of developed counties.
Unfortunately, however, this growth was also characterised by a lack of job growth. The economy was growing, profits were rising, dividends getting bigger, but no new people were joining the winners circle.
Since the economic crisis bottomed out, businesses have been fighting for business as usual with all kinds of government accusations. Business is not ready to embrace the “give and take” that characterises all stakeholders of a society that cares about sustainability.
Such “give and take” has to be pushed down their throat, otherwise business will take us down the road to ruin.
Therefore, beyond the profit imperatives of a company, let all transactions also consider positive spin on society, jobs, upskilling of bottom employees, etc.
Yonela Diko
Cape Town