Big business has weighed in on the newly formed government of national unity (GNU), saying that it will increase business confidence and chances for SA to rake in R5-trillion in investments.
These sentiments were expressed at the Democracy and Markets Investment media roundtable hosted by Standard Bank Investment Solutions in Rosebank on Thursday.
“For the last 10 years… consistently [business] confidence has been bedevilled most profoundly by the political cycle: politics in its pure form and also state-owned enterprises,” said Standard Bank chief economist and head of research Goolam Ballim.
“Perhaps what binds the ANC of president [Cyril] Ramaphosa together with the DA is the proximity to good governance. So, 60% of the electorate chose two parties that, for all ideological divisions, are melted together by an intent of good governance.
“I think it is a very sound bedrock upon which we hope the DA holds and which will be the source of policy making and policy choices going forward.”
He predicted that SA’s prosperity prospects would be linked to the success of the GNU, saying the coalition was the genesis of the direction of business confidence. Ballim stated, though, the GNU was not a “broad church that the ANC once was”, the liberation and empowerment ideology was still strong.
“If you calculate the ANC plus the EFF plus MK, you are up to two thirds of voters. I think that must be recognisable that we still have a transformation agenda embedded in political choices,” said Ballim.
Business Leadership SA said the markets were responding positively to the GNU configuration.
“The markets are looking for fiscal sustainability … political certainty and for an environment where they can bring their money in and be able to take it out,” said chief executive Busisiwe Mavuso.
Mavuso said business confidence was sitting on 30%.
“This is not a good place to be for a country that is trying to bring in R5-trillion investment, as the president has said, in the next five years, 30% investor confidence is not what you are looking for. I really think the political shifts that have happened would actually give us an opportunity to probably increase that level of confidence.
“The markets are not pro-DA or anti-EFF. They are just not for nationalisation. They want an environment that can provide them continuity, certainty and stability…
“The status quo was untenable … and unsustainable, and something had to give. People in 2019 decided to give our current President Cyril Ramaphosa a chance in spite of the ANC and not because of it. And I really think that there’s been a great disappointment from the New Dawn, because the New Dawn didn’t deliver. So, what you see is an election outcome that says we want change and … we don’t trust any single political party to rule.”
In his opening of parliament address on Thursday, Ramaphosa acknowledged the economic weaknesses, saying despite the achievements of 30 years of democracy, millions of South Africans remained poor, unemployed and lived in a highly unequal society.
“For a decade and a half, our economy has barely grown,” he said.
He said the GNU had resolved to dedicate the next five years to priorities aimed at driving inclusive growth and job creation, reducing poverty and tackling the high cost of living.
