South Africa in a world divided
John Battersby
15 May 2008
Never has the world been in more of moral conundrum: the past couple of decades have seen a massive increase in wealth concentrated in the hands of a super-rich class, but never has there been a more rapidly widening gulf between the rich and the poor.
While the centre of global economic power is shifting eastwards and southwards, the level of disparity between the two worlds is growing.
The so-called "developed world" complains correctly about human rights abuses in Myanmar (Burma), Zimbabwe, North Korea and Tibet, and liberal rights activists urge transnational companies based in Europe and North America to cease the hugely profitable business they are doing with such regimes.
Meanwhile, so-called "developing countries" make out a convincing case that the moral high ground which the developing countries claim has long since crumbled. It is these same "developed" countries, they argue, that have forged a global economic system based on massive inequality and vested interests.
When the going gets rough ...
It is the same "developed" countries that - in the name of economic growth - have brought the world to the edge of environmental disaster.
To extricate themselves from the disaster, they are now turning food into biofuel on a massive scale, which is putting basic foods prices beyond the reach of the poor and creating a deep fault-line in tenuous global stability.
It is also these same "developed countries" which - in the name of wealth creation which many would call greed - have created a financial system where a new class of super-rich bankers and fund managers grow richer by risking other peoples' money and re-packaging bad debts and dispatching them to foreign shores.
When the going gets rough, these same beneficiaries of the global financial system are baled out by central banks to the tune of billions while they continue to dish out billions in bonuses to each other.
Do we wonder why the world looks very different from Mumbai, Beijing and Tshwane to what it does when viewed from London, New York or Frankfurt?
ANC president visits Europe
But that's the global world and the financial system in which South Africa has to play. And that is the world in which the president of the African National Congress (ANC), Jacob Zuma, landed three weeks ago on a whistle-stop tour of Germany, Britain and France.
Why then did the shares of South Africa Inc. take a modest lift, and why did one hear talk of hope and promise again in the SA brand despite the energy crisis, the post-election stalemate in Zimbabwe and continuing high levels of crime in the country's metropolitan centres?
Perhaps a clue lies in the truism that the fastest way to make friends for South Africa is to get people to visit the country.
They become engaged, focus on the positives rather than the negatives and go home with a glowing feeling about the country and its people which has got something to do with ubuntu. But they can't put their finger on it, so they want to go back.
Face to face with Jacob Zuma
In the same way, the investors and opinion leaders who met Zuma face-to-face were reassured to find a responsive, open and pragmatic leader espousing investor-friendly economic policies and ways of dealing with poverty, and who is committed to a smooth transition of power in South Africa.
It contrasted with media stereotypes forged by his acquittal in a rape trial and corruption charges he is facing relating to the arms deal.
They found Zuma is a leader who played a key role in peace negotiations with warring factions in KwaZulu-Natal before elections in 1994 and in persuading right-wing Afrikaners against taking up arms.
And they found that he was once a fellow prisoner with former President Nelson Mandela on Robben Island and that President Thabo Mbeki was once his commander in the underground military struggle waged against apartheid.
They also found that Zuma had developed forthright views about the post-electoral impasse in Zimbabwe and that he was in favour of more muscular efforts to support the intricate diplomacy of Mbeki, which led to the ruling Zanu-PF party losing its majority for the first time in an internationally monitored election.
Investors were reassured regarding the future direction and continuity of the ANC's core economic policy. "There was no ideological debate," noted one institutional investor. "Economic policy will remain on course."
ANC priorities
Investors were impressed by Zuma's setting, as the top priorities of a future ANC government, further investment in education, health care and crime fighting as the major priorities of any future government led by his team.
They also remarked on the diversity of skills and leadership qualities of his colleagues - ANC treasurer-general Matthews Phosa, ANC communications chief Jessie Duarte, and former trade unionist and NEC member Enoch Godonogwana, who accompanied him on the visit.
Investors noted Mr Zuma's commitment to the rule of law and to an independent judiciary and his assurance that the law must take its course and that any conviction in the trial he is facing would lead to him standing down as President or ANC candidate for the Presidency.
The investors were encouraged by Zuma's readiness to listen to their views and his openness to joint action between the ANC and leading companies to address such pressing problems as the energy crisis, the skills shortage, the crime problem and poverty and unemployment.
But he was also left in no doubt about their deep concerns relating to the energy crisis, the unacceptably high levels of crime, and the urgent need to address the severe skills shortage, both in relating to training and easing immigration constraints for the short-term importation of skills.
Adjusting the model to deal with poverty
The present government has laid the foundation for sustainable economic growth with the implementation of sound macro-economic policies and increasing interventions to stimulate development and social expenditure from a position of strength.
In a world which has lost its moral compass, the debate about the developmental state, and the different forms of government in which people are increasingly empowered but the state directs the nature of development, will continue.
South Korea and Taiwan followed economic liberalisation with political liberalisation. China and Vietnam have yet to address political rights. Singapore has forged a new model of the development state. Thailand, Malaysia and Indonesia are refining participative systems which suit their particular circumstances.
South Africa and India have well-established democracies but will need to adjust their models to deal with poverty in a rapidly changing world.
The recent international outreach by the leadership of the African National Congress suggests that South Africa's ruling party will be a key player in this global debate to find a global system which levels the playing fields.
John Battersby is the UK Country Manager of the International Marketing Council of South Africa. He is a former editor of The Sunday Independent.
This article was first published in Business Day. Republished here with kind permission from the author.
