With South Africa’s general elections two months away, the business sector is on edge about the future and the impact on investment.

At Daily Maverick’s The Gathering Twenty Twenty Four on Thursday at the Cape Town International Convention Centre, Ann Bernstein from the Centre for Development and Enterprise, businessman Mark Barnes and economist Iraj Abedian spoke to associate editor Neesa Moodley about the upcoming elections, the impact on business confidence and risk perceptions to prospective investors.

Abedian, the founder and chief executive of Pan-African Investment and Research Services, provided an overview of the prevailing circumstances, in which the country celebrates low economic growth, which is due to the government’s mismanagement. This year’s elections are vital: he said South Africa finally needs a government that is half-credible, even if it is not fully credible, to help drive the recovery of foreign investment.

Bernstein reminded the audience that business leaders were teaming up with government to help them govern the country.

Ann Bernstein speaks during The Gathering Twenty Twenty Four Election Edition at CTICC. (Photo: Shelley Christians)

“We need to stop doing this. We have diagnosed the problems. We shouldn’t dismiss the causes of South Africa’s crisis. When the president refers to nine wasted years, as though he wasn’t next to Jacob Zuma, he’s also responsible.”

Bernstein added that business confidence had reached rock bottom: the country was attracting very little new investment and South Africa is in deep trouble. “It’s hard to see the tunnel, let alone light at the end of the tunnel.”

When asked what ordinary people can do to effect change, Bernstein said, “You should vote and vote differently”.

Barnes, the former CEO of the SA Post Office, said it’s up to each South African to work at improving the country, because “this is our home”.

While there are numerous examples of government failures, the economy is driving the system and it works. Barnes said he believed an existential crisis would help vitalise the country: “We’ll find ways around the blockages. We’re going to find new solutions. This existential crisis will galvanise us… (but) we need a 45-year-old president. It’s kinda difficult to build for the next 45 years when you only have about three years left.”

Mark Barnes speaks during The Gathering Twenty Twenty Four Election Edition on 14 March, 2024. (Photo: Shelley Christians)

‘Not enough plumbers’

Abedian bemoaned South Africa’s unemployability problem, with tertiary institutions that are looking backwards, not forwards.

“They’re not fit for purpose. We are short of skills required to run the economy — short of plumbers, electricians and other trades — we think degrees are going to make people fit into the economy. But if the economy doesn’t give people the opportunity to fit in, it’s a problem.”

Read more in Daily Maverick: The Gathering 2024

The focus on tertiary education is wrong, he said: there’s too much emphasis on certification, not capability and expertise, so the people who qualify from universities cannot find work.

Bernstein agreed, saying focusing only on skilled people was a cop-out.

“We have millions of people who need unskilled jobs today. People who talk about the fourth industrial revolution ignore the millions of unskilled people in the country because they don’t want to deal with the facts of our employment. We don’t want to speak about low-skilled jobs that drive economies in China, Vietnam and elsewhere.”

South Africa was experiencing a poly-crisis, she said, adding that it was the poor who were most affected by the cost of living, transport, unemployment, crime and energy crises. Citing the example of the passenger rail system, she said the system had collapsed: five years ago there were 500 million passenger journeys; last year barely 200 million.

“Unemployment is probably also the highest in the world. We are just realising that as a society and as an economy. It’s important to understand the consequences.”

Questioning the government’s socialist focus instead of encouraging entrepreneurship, Barnes said he wondered if the intention was not that it aimed for a dependent, compliant populace. “I get the sense that it’s not independent individuals that we are nurturing and growing and promoting.”

Dr Iraj Abedian speaks during The Gathering Twenty Twenty Four Election Edition. (Photo: Shelley Christians)

No shortage of money

For the first time in the past 50 years, there was no shortage of money, funds and investable opportunities, Abedian said, but government ministers do not understand the importance of time in attracting investment.

“The countries that have the right infrastructure, attract foreign direct investment. There’s no shortage of capital. Some countries will emerge and some will submerge — those that move at the pace of the 20th century, not the 4IR, will submerge.”

Abedian said it was time for the private sector to get serious about the government and coalitions.

“Fortunately the economy is resourceful. Competent and timely action will turn things around,” he said. DM