Mboweni says SA must change the way it does business
DAVOS - Finance Minister Tito Mboweni, accompanied by International Relations and Cooperation Minister Naledi Pandor and Minister of Trade and Industry, Ebrahim Patel addressed a SA Business session in Davos,Switzerland, at the World Economic Forum on Wednesday morning.
Mboweni stated clearly, to the small group of global and local business leaders, that South Africa had to change the way it does business.
"It clearly doesn’t work: our economy is not growing at the rate we desperately need and our foreign direct investments is less that what is needed to create jobs, ” he said.
The economy has been in the doldrums.
In November, Statistics SA said South Africa's gross domestic product had decreased by 0.6percent in the third quarter of 2019, following its rebound in the second quarter.
The International Monetary Fund this month slashed the country’s growth forecast for 2020 to 0.8percent from 1.1percent it projected in October.
Mboweni lead the South African delegation, explaining the absence of President Cyril Ramaphosa “who decided to attend another event this year”.
Only two other ministers are attending WEF Davos this year – the least number of ministers in many years.
Even the business delegation consists of a few banking chief executives, a few business leaders as well as black economic empowerment leaders Dr Iqbal Survé representing the
Sekunjalo Group of Companies and Patrice Motsepe, the founder of African Rainbow Minerals and African Rainbow Capital in attendance.
But some global leaders questioned why Ramaphosa chose not to attend this very special 50th year WEF celebration, during a time that investors are looking for answers about how South Africa is going to deal with its economic problems.
Top on the list of concerns of investors is state-owned parastatal Eskom, which is unable to keep the lights on with business implications, answers about corruption, safety and security, among others.
“There are also a lot of talk about instability within the ruling party, is it true?” an investor from India asked.
Another question was raised at the annual South African dinner held on Tuesday night by a prominent head of a SOE (state- owned enterprises). “Why do we have a Minister of SOE’s, if we have a minister for energy, agriculture, transport, etc.? What is his job description, or is his job redundant?
Treasury in a statement last week said Team South Africa at WEF would convey the message that while South Africa faces challenges of weak economic growth and fiscal pressures, the country remained open for business as one of the best investment destinations in the world.
"Team SA will also highlight the strides being made to implement structural reforms to ignite economic growth; ease the cost of doing business; curb government debt; and stabilize SOEs."