The World Economic Forum will be taking place from January 23 – 26, at the Swiss ski resort town of Davos. The annual gathering of influential people from the financial and business world is set to be interesting with the theme of “Creating a Shared Future in a Fractured World”. However, the more important question for South Africa is what will our politicians and business people be aiming to do at the forum.
The South African delegation to Davos will be led by the deputy president and new African National Congress (ANC) president Cyril Ramaphosa. Along with Ramaphosa and business leaders, other South Africans going include finance minister Malusi Gigaba; minister in the presidency for planning, monitoring and evaluation Jeff Radebe; minister of economic development Ebrahim Patel; minister of trade and industry Rob Davies; minister of public works Nkosinathi Nhleko and minister of international relations and cooperation Maite Nkoana Mashabane. This is the second year in a row that Ramaphosa will be heading the delegation.
Political analyst Professor Tinyiko Maluleke said in an interview with The Daily Vox that Ramaphosa leading the delegation to Davos is Zuma yielding power and is consistent with the slow but effective takeover of key roles by Ramaphosa since he was elected president of the ANC.
Maluleke also said: “But clearly the World Economic Forum has become an important platform for marketing countries and for telling good economic stories about countries. And I think for that reason the desire to tell the good story and to resuscitate the South African economy, Cyril Ramaphosa is seen as someone a lot more capable of that. This is because of his lack of scandals in matters financially but also because for all intents and purposes he is likely to become the next president of South Africa. That’s the man the markets would like to see and investors would like to talk to.”
However, Maluleke notes that on the whole while Zuma is willing to yield some power, in some key areas he wants to keep it to himself.
Speaking at a pre-WEF business breakfast for government and business on Thursday, Ramaphosa told delegates that: “The overriding concern leading up to WEF was political uncertainty. I’d like to believe we now have certainty with the new leadership to take the country forward.”
Ramaphosa also said that in order for South Africa to have an economic recovery, job creation, inequality and poverty would need to be addressed. Ramaphosa also plans to make it clear to the other delegates at the forum that South Africa is serious about fighting corruption.
The message that the South African delegation will be carrying to Davos seems to be that South Africa is open for business and investment. Ramaphosa said his “sole purpose” in going there is to “sell the country” as an investment destination.
“When we say we are open for business, we mean it in earnest,” said Ramaphosa.
Business Unity South Africa’s Jabu Mabuza said that one of the things South Africa will need have at the centre of the focus is plans on how to reignite growth and create employment.
IOL reported that Mabuza said: “Our view is that there will be a critical need to demonstrate an urgent refocus and credible solutions to the key issues that resulted in our deteriorated creditworthiness, including clear plans for the reform of our key (state-owned companies) as a priority and commitment to fiscal discipline (which entails) strong measures on cost containment and structural reforms to boost growth and revenue collection to arrest the unsustainable increase in government debt and increases in fiscal deficits.”
Dawie Roodt, chief economist at the Efficient Group said to The Daily Vox that while progress has been made in South Africa in the past several weeks, a lot more needs to be done as the local delegation heads to Davos. He said South Africa is in crisis and it will difficult for the delegation to present a plan to the world. Roodt says he believes the best thing is for South Africa not to go to Davos at this stage because he does not think the country has an economic plan.
“I think Cyril Ramaphosa should be in South Africa. I don’t think he should go to Davos. Davos is for if you have a plan and want to sell something. What do we want to sell? I’m not even sure what our macroeconomic policies are,” said Roodt.
Roodt says while he agrees with Ramaphosa that he needs to sell South Africa to investors: “Everybody knows that he isn’t the president at the moment. There’s a big power struggle within the ANC, indeed there are two centres of power, the fiscal accounts are in dire straits so everyone knows there are major issues we need to deal with first.”