South Africa: Country Needs to Return to Economic Premier League
OPINION – IF THE looming potential of a turnaround in Zimbabwe's economy becomes reality, as is probable, it would transform the economy of the entire Southern African Development Community (SADC) region, says scenario planner Clem Sunter.
There is an estimated $12bn to $15bn "available, waiting in the sidelines" to be invested in Zimbabwe, mostly from potential investors in the US and the UK – enough to put Zimbabwe back on track towards a solid economic footing and, importantly, most of this money would flow through SA, Sunter explained.
"That’s the difference from (Zimbabwean President Robert) Mugabe staying and going," Sunter told a South African Institute of Race Relations breakfast in Johannesburg yesterday.
Sunter believes Mugabe’s contested win in presidential elections in March marked the start of "the endgame" of his rule , which has brought economic disaster this decade.
The potential for an economic about-turn in Zimbabwe, added to the "golden opportunity" SA has in hosting the 2010 Soccer World Cup, mean that SA is "not a bad place" to see out the hard times the world is currently experiencing, Sunter said.
It is crucial, however, that SA take proper advantage of the opportunities with which it has been presented, and that it fight hard to return to the "premier league" of nations after being demoted to the "relegation zone", as evidenced by the 53rd-place ranking of SA in the Swiss International Business School IMD’s World Competitiveness Report, published this May .
SA plunged last year from repeated rankings in the mid-30s since its first ranking in 1994 to 50th place. This was because the country’s high violent crime rate meant it was experiencing a talent exodus, the high rate of HIV-infection had lowered life expectancy, and it has an uncompetitive labour cost structure, Sunter elaborated .
The first thing that happens when a team is relegated is it loses its sponsors, and if SA does not fight back to recapture its place in the premier league of nations, it will lose its place as the "prime spot" for foreign investment in Africa, probably to Nigeria. Nigeria is keen to usurp SA in this, has a massive population and is working to eradicate its image as a corrupt state, Sunter said.
SA also stands to lose the "fringe benefits" it enjoys as the major African economy, including its seat on the United Nations Security Council, its position as the de facto "voice of Africa" and its lucrative trade partnership with China.
"Then, we’ll be like the rest of the second division: poor, but peaceful, which is okay, but not good enough for the ANC’s (African National Congress’s) better-life-for-all vision.
"Add public violence to this scenario and SA will become just another failed country.
"Nothing trashes your brand more than violence or the threat of violence … since we (Sunter and co-author Chantell Illbury ) wrote that we’ve had the xenophobic attacks and threats of violence (from some players in the ANC) … but Martin Luther King did not change people by saying ‘I have a nightmare’, and our dream is getting back to the premier league," he said.
To take advantage of good options still open to SA, the country needed brave leadership from someone who: is prepared to make unpopular decisions to benefit SA in the long term; is interested in "turning on" all South Africans, not only the "4000 that turned up at Polokwane"; is prepared to fire people for mediocrity and lack of performance; and is prepared to be judged on results.
SA also needed "back to basics management" to ensure its people are guaranteed the "three entitlements" — safety, good education and health — and a "dual logic economy" that is internationally competitive and internally effective, Sunter said.