South Africa’s current investment climate could explain a waning optimism in some quarters about the country’s “new dawn”, prof. Thuli Madonsela, law
trust chair in social justice at Stellenbosch University, said on Tuesday.
“(Economic) data is not
looking good. It frightened a lot of people to think government is not doing
its job,” she said at the i3 Summit 2019 at the Spier Estate near
“Investment is like an egg.
There is a time when it is vesting and a time when it finally yields. A promise
of a new dawn is not broken just because there is not an immediate yield.”
She emphasised that, although
both local and international investors are concerned about the yield they would
get on their investment in SA, there should also be a focus on creating an
inclusive economy which does not leave anyone behind.
“So, part of the
difficulty we have with the ‘new dawn’ is that SA has the highest percentage
of people living below the poverty line. Government has been trying to tackle
this since 1994, but still only 1% of poor people are white and 64.2% of black
African people are poor and unemployment at about 26.7%,” said Madonsela.
“Therefore, as we go forward, we have to reflect on the fact that many South Africans are concerned about
Madonsela believes there is a way to give investors a return on their
investment as well as lifting people out of systemic poverty. If
Ramaphosa continues to “walk the talk that no-one is above the law,
investors will come”, she said.
“Most people would say the
next move in unfolding the new dawn depends on President Cyril Ramaphosa, but
my parents taught me that if you want a particular outcome, the next move is
always yours,” said Madonsela.
“Yes, on the one hand we
want an investment climate, but on the other hand there is the challenge of
poverty and inequality, which in turn form part of the destabilisation of the
Madonsela said business should try
to create an eco-system where it continues to act ethically no matter what
others do. For her this means not just doing business because it is business,
but doing business because there is a purpose in what you are doing.
“Of course making money is
important, but it helps to have a focus that transcends money. Be impact
conscious of your actions and its consequences. We will not be able to achieve
the new dawn if there is not ethical conduct from the cleaner to the president,”
“It is about building a new
SA where it is important to be inclusive for all of us and within creating a
Investments of all sizes
She said investments need not be
big, but could involve investing in small villages – not just as a donor, but
as a partner involved in the process of change and helping communities to lift
themselves from poverty.
This kind of investment will also
address investor concerns about unrest in townships by helping to address
social aspects leading to the protests, in her view.
“Let us start thinking out
of the box in order to create sustainable businesses and find a way to get to
where you want to be despite the turbulence. We have to work together in SA and
I believe we will make it. A flower that blooms in adversity is the most rare
of all,” she said.
“Rather start new businesses
where big business can be co-owners to increase the cake.”