Defend Truth


The ANC cannot fix itself; South Africa’s last hope is business


Bonang Mohale is chancellor of the University of the Free State, former president of Business Unity South Africa (BUSA), professor of practice at the Johannesburg Business School (JBS) in the College of Business and Economics and chairperson of The Bidvest Group, ArcelorMittal and SBV Services. He is a member of the Community of Chairpersons (CoC) of the World Economic Forum and author of two bestselling books, Lift As You Rise and Behold The Turtle. He has been included in Reputation Poll International’s (RPI) 2023 list of the “100 Most Reputable Africans”. He is the recipient of the 2023 ME-Vision Academy’s “Exclusive Recognition in Successful Leadership” award.

What is becoming increasingly clear is that this ANC-led government is incapable of self-correction and our last hope is business. If South Africa is ever going to get out of this deep hole, it is because business has decided that it will make the country work.

Poverty is not by accident, it is by design — lower-income, less educated, voiceless people are so much easier to control. South Africa has given up its position as the biggest economy in Africa, with a GDP of $412-billion, to Nigeria at $505-billion and Egypt in second place at $469-billion.

While South Africa’s ports and freight rail infrastructure crumble, the Maputo port and car terminal volumes grew by 30% and 35%, respectively, in just six months ended 30 June 2022.

Internally, KwaZulu-Natal is working extremely hard to ensure that it gives up its number two position (to the Western Cape’s 14%) of 16% contribution to the national GDP — what with the construction mafias, SA’s highest murder and rape rates, truck drivers’ perennial blockades of the N3 highway, the two weeks in July 2021 of a failed insurrection and rampant looting, man-assisted floods 2.0 during the Easter holidays and May 2022, and beaches with raw sewage pouring into the Indian Ocean.

What is becoming increasingly clear is that this ANC-led government is incapable of self-correction and our last hope is business. If South Africa is ever going to get out of this deep hole, it is because business has decided that it will make the country work.

Only business can substantially increase its investment in infrastructure and thereby deliver mega-projects on time, on budget and in full. But to do that, business needs a serious intervention to steer it back. Because it is incongruent to speak of a just society when business is seen to be at the apex of injustice. Business must reclaim its voice, integrity, reputation and credibility. Contrition is an ongoing process — you have to continuously ask for forgiveness and be eternally grateful for the mercy shown.

Bleak time

It is indeed a bleak time for the global economy, which is undergoing huge regime shifts, a worldwide slowdown and demonstrating the troubled neighbourhood we are in with multiple crises.

The world is moving away from financial stability, predictable financial markets, low interest rates and low inflation. Now the world is characterised by exogenous shocks, unpredictable and increased volatility precipitated by the pandemic, Russia’s unprovoked, unwarranted and unjustified invasion of Ukraine and climate change.

The proof points are global recession, supply chain constraints, labour shortages, fuel and food prices crises, double-digit inflation, increasing interest rates, low (1.1%-2.7%) GDP growth, increasing borrowing costs, a potential fifth wave of the public debt crisis, increasing global commodity prices, reduced incomes, eroding household purchasing power, a cost-of-living crisis, increased poverty levels, increasing social tensions and 123 million people in sub-Saharan Africa experiencing acute food insecurity.

There is an urgent need for fiscal coordination. The Americas and European countries are now reviewing their economic policies. The just energy transition is being seen as the best chance to return to growth in years to come.

This year has been difficult for South Africa. Global events have constrained supply chains, leading to rising input costs that have left C-suites with difficult choices to make regarding new investments, inventory holdings and revenue projections, among other issues.

However, rapid developments around the liberalisation of South Africa’s energy policy hold the potential to spur innovation and drive growth in other sectors of the economy.


In the social context, South Africa has the highest unemployment rate in the world — 34.9% by the standard definition and 46.3% by the extended definition, with 66.5% youth unemployment, against a global average of 6.4%.

In the Human Development Index, South Africa ranks in the second-lowest quartile. Half of the adult population lives below the poverty line and 19 million people of the 60 million population are dependent on social grants. No less than 47% of households ran out of food during Covid-19 lockdowns.

With the highest Gini coefficient globally, South Africa is the most unequal nation in the world. The richest 10% hold 71% of the wealth and the poorest 60% hold 7% of the wealth.

The Global Peace Index ranks South Africa in the lowest quartile globally with high criminality, easy access to weapons, high political instability and high degrees of violent protest. The Institute for Economics and Peace estimates the economic impact of crime (direct and indirect economic multiplier) at 12% of GDP (total: R2.2-trillion).

South Africa experienced the largest economic contraction during Covid-19 in Africa (-6.4% in 2020), following years of economic stagnation. The economic performance is set against the context of State Capture with an estimated economic cost of R1.5-trillion, as well as the deliberate destabilisation of state-owned enterprises.

The socioeconomic context is reflected in the economy. South Africa is ranked the 38th-largest economy in the world but ranks only 92nd on GDP per capita ($13,520).

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Major disruptions

Two major local events have had an impact on the post-Covid-19 economic recovery. The KZN riots in 2021 resulted in a loss of about R50-billion, estimated at 0.7% of the national GDP. The KZN floods in 2022 caused infrastructure damage of R5.6-billion, property damage of R1.9-billion and Durban lost close to 2% of its annual GDP.

Russia’s invasion of Ukraine has also had an adverse impact on South Africa — whose economy is 2.5 times bigger than Ukraine’s — with higher fuel, oil and grain prices, which is pushing up the Consumer Price Index. Higher commodity prices are driving second-order inflationary increases (including transport and agriculture), which markets are pricing in at an increase of 234 basis points over the next 12 months.

While inflation is currently high, normalisation is expected in mid-2023. Eskom has indicated that South Africa is facing a significant strain on its electricity supply. The instability in supply will further contribute to lost business revenue and increased costs, priced back to the consumer.

In sub-Saharan Africa, Covid-19 has been devastating. In 2020, the region had its first recession in 25 years and its first increase in extreme poverty in 20 years (40 million more people). Impacts were particularly felt in the informal sector as well as private-sector supply chains, commodity exports, tourism and lockdown trade.

Food security decreased and education was adversely impacted, with up to half of children (country-specific) not being able to access education remotely.

Some larger African economies are recovering from Covid-19 on the back of strong commodity prices and increased consumption, but economies remain vulnerable.

Russia’s invasion of Ukraine will amplify food and energy price inflation in Africa (a 4% regional average is estimated) and the International Monetary Fund predicts that some of the poorest and most vulnerable African countries will be the most affected globally.

Central bankers are trying to balance economic growth and inflation, but Foreign Direct Investment (FDI) in Africa remains low. Africa has 17% of the global population, and comprises 20% of the global land mass, but has only 4% of global FDI, with a 16% decline in 2020.

Contributing problems include political instability, corruption, lack of infrastructure, poor education and unpredictable policy environments, resulting in poor economic growth and inequality. Structural reforms and social buffers are needed. To protect consumers, the Central Bank of Lesotho has introduced a variety of prescribed bank transaction fee limits, including zero deposit fees at ATMs.

The global economy has shown recovery since the 2020 Covid-19 lockdowns began, but the recovery has been uneven and adversely affected by global events.

From a societal perspective, health, education, income disparity and livelihood crises are now emerging as the largest global societal risks to social stability and cohesion.

War impacts

Russia’s invasion of Ukraine has created a political divide between the West and East, with severe sanctions being imposed on Russia, and China remaining largely neutral. Ukraine, supported predominantly by Western Nato countries, has shown stronger resistance than expected, which has resulted in a much more prolonged conflict. The impacts are rippling through global markets, with supply chain disruptions, increased commodity prices and an energy crisis, as Russia and Ukraine produce 12% of the world’s oil and 17% of its natural gas.

Direct results include the Brent crude oil price increasing from $93 to $107 (15%) over the past two months, with significant volatility (the highest spike recorded was $128, a 33% increase). A sustained increase to $150 will trigger a global recession.

Global transport impacts and supply disruptions, together with food supply disruption (Ukraine and Russia account for 30% of the world’s wheat exports and 60% of the world’s sunflower oil) are now driving increasing inflation. The compound effect is a downward adjustment in global GDP growth forecasts, which started at 4.9% and are now expected to be in the range of 4.1%-4.5%. Global interest rate increases will result in increased capital outflows from emerging economies.

If I were to choose only three of the top 10 risks facing us as a people with great natural endowments, it will be the lack of a stable, reliable and predictable energy supply; youth unemployment; and the lack of implementation of structural economic reforms.

Business is committed to working with the government to drive economic growth. Business and the government have agreed on the bold and ambitious reform agenda of the ERRP and have worked together on, among others, Operation Vulindlela to effectively implement some of the reforms. Current focus is on monitoring delivery of the consolidated ERRP by social partners through Nedlac. To regain momentum, we’ve identified six areas from the current list to focus on in the immediate term. Our priority today is to agree on the process for implementation, based on learnings and the successes of Operation Vulindlela and the B4SA/government partnership. There are six immediate priorities to deliver on through public-private partnering: 

Investment and growth

  • We need an unconditional message that South Africa is open for investment – which requires policy certainty and interventions to improve the ease of doing business; and
  • We will work jointly with the government to create sustainable, inclusive growth off the back of this investment.


  • Identify and put out to bid four or five critical growth-enhancing infrastructure projects which business can confidently fund – this is significant for job creation.

Network industries

  • All industries that, if properly managed, aid and abet growth, and if not, inhibit growth – including all ports of entry (harbours, rail, road), spectrum, electricity and water.

Capable state

  • Implementation capacity is required by the government. Business will work with relevant departments to identify skills gaps and remedies, including secondments.

The Zondo report 

Business supports the findings of the report and will assist with capacity to help the government implement its findings, including secondments to the DOJ and NPA, if needed. We will set up a “Integrity Fund”, ringfenced only for prosecutions, managed by National Treasury, to enable the NPA to appoint counsel according to Section 38 of the Constitution.

Law and order, crime and security

  • We need to demonstrate tangible progress on bringing those responsible for the July insurrection to book. Investors require confidence that the government has the skills and the will to prosecute and uphold law and order. Business can scale existing support to the SAPS and prosecuting agencies to assist, if required.

B4SA is a case study of an extraordinary public-private partnership to support the national vaccination roll-out. The next steps are substantive bilateral ties between the government and business to progress implementation. DM


Comments - Please in order to comment.

  • Miles Japhet says:

    BONANG is on the button. Civil society has to continue talking truth to power. Business must be ever more open and honest and forge a path to self sufficiency in the interests of the country.
    Unions need to understand they are part of the problem and recognise that they are losing members as a result – not good for their own income!!
    Those that seek to divide us must be exposed for wheat they are.
    South Africans are a formidable Team when working as one.

    • christo o says:

      Miles, I love your last sentence.
      Lets talk about the first elephant in the room: BB-BEE means that from a business point of view we are NOT one. The unequal distribution of wealth does have a historical racial bias, and we know that some of us started the race ahead in terms of education and access to opportunities. Research data shows 2nd and 3rd generations will continue to have that advantage not because they are white, but because of the culture in which they grew up and access to more opportunities.

      For me the second elephant in the room is that we should stop focusing on youth unemployment and instead focus on successful existing small businesses owners in their 30’s and 40’s. They understand the markets they serve and have the requisite work (hustle?) ethic. You simply cannot teach someone who is fresh from matric how to be a business person if they have no real world experience, and do not know what it means to show up and do good work. I know this because I run supplier development programs for corporates.

      You can help someone who already understands their market to grow their business by giving them access to funding and skills to compete in an open market. And when their businesses grow, they will need to hire people.

      If we all agree that data says we should make small businesses work and we choose to ignore populism and politics, and that skin colour does not count as much as the ability to create jobs and value, Business will be working as One.

  • Martin Ernst says:

    Business needs to get vocal about how catastrophic the ANC is and encourage people to vote more intelligently – maybe a concerted massive voter education drive could work in anticipation of 2024?

  • Mark Lamberti says:

    As always, an eloquent and comprehensive summary of the circumstances we face as South Africans. Thank you Bonang. Thank you too for once more alluding to the sentiment of my 2005 op-ed “Black Forgiveness White Sharing”.

    Formal business, speaking and acting collectively, is undoubtedly a major antecedent of a better future. There are however two significant streams of unmeasured, underestimated economic activity that currently prevent even greater poverty: the informal economy and crime. How we nurture the former while eliminating the latter adds to our challenges.

  • Ockert Fourie says:

    Thank you, Bonang for this well written article with plenty of facts and suggestions.
    My only response is that we can turn this around, but only without the ANC. The people must rise and vote in 2024 for any party except the ANC and the EFF, since those EFF racists will be even worse than the ANC.

  • virginia crawford says:

    Bring back apprenticeships and technucal colleges to prepare for skilled trade, and they can open their own businesses and create jobs. The ANC has failed catastrophically and, just like the Russians after the 90s, I’m at the ‘anything that works’ stage. They got Putin: what will we get? Business would be better than the RET/ EFF brigade. Or should that be brigands?

  • Andy Miles says:

    Great article. Good priorities. Major constraint, is political. The ANC has too many political drivers. One end is State power for self gain, the other is mixed free market with the State in a developmental role. If we functioned as the democracy we have on paper and the ANC leadership had courage of their convictions it would have already split into 2 parties. Solution to share the very valuable ANC brand – 2 names each bearing ANC e.g. “ANC Democrats” “ANC Republicans”. Voters would have to actually understand what they are voting for. I’m 70, a corporate turnaround management career. Grew up in UK and saw the throttling effect of socialism on development through the 1960’s and early 70’s. Few thoughts. However, well intended left wing ideologies have poor outcomes. My view, smaller decentralised Government works best. Also promotes the civic involvement in local and Provincial Government that, managed properly is a feeder of competent resources for National Government. The agglomeration of power in Mega Cities and executive mayors has failed. The bigger the enterprise where “they” fix things, is replaced by decentralised power where “it’s my responsibility to fix things”. Fix SAPS. Investigative journalism DM, News 24 better than the police. Mobilise working together? Prosecuting the corrupt. Need a simpler court system – Chapter 9 institution with own rules? Suggest a level of culpability test that enables earliest conviction to obviate the Leningrad defence.

  • Cunningham Ngcukana says:

    It is very good that Bonang has woken up to reality. A party in power with its leadership and cadres competing for positions to access and control resources for themselves through patronage, theft, corruption and abuse of public funds that party is bound to have challenges of unity. It is worse when it lacks credible processes to deal with issues of corruption in its ranks. We have thieves saying they are going to renew themselves in stealing not in the interests of the country. but to remain in power. We all supported Ramaphosa in 2017 like Mohale with the hope that he is going to break the corruption chain and be decisive on those who are corrupt. He has confirmed that he is not going to do that in the statement he made in the NEC last December and also himself he is unable to explain a burglary irrespective of the character who brought the matter to the public. A personal matter has become an organisational issue because of the position he holds in the ANC. We have Nkandla 2.0 no matter how much the Daily Maverick journalists seek to spin the matter. We never expected that he would be found wanting in such a manner and an issue that is being massaged by the media including the Daily Maverick by questioning the person who has raised the matter rather than the substance of the issues. The matter was taken to court to whip ANC MPs into line but it will follow him into his last term because it will not be withdrawn because of the issues he raises.

    • Miles Japhet says:

      You and Bonang and so many smart South Africans like you
      Need to provide the alternative thought leadership to the poor
      The question is how?
      We are here to help

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