Business has to be more involved in mapping out South Africa’s economic future, scenario planner Dr Clem Sunter said this week, arguing that the approach of government’s National Planning Commission was too academic.

Speaking at the Master Builders South Africa yearly congress in Cape Town, Sunter renewed his plea for an ‘economic Convention for a Democratic South Africa (Codesa)’, which he and others such as journalist and social analyst Max du Preez, have been calling for.

“We feel very strongly that we need a Codesa-3, an economic Codesa, where we have a no-holds-barred negotiation over the future of this economy. . . What we need are the real players to be sitting down and negotiating,” he said.

According to Sunter, South Africa has been in the ‘premier league’ of nations since 1994 as it has been consistently ranked between 35 and 40 out of 59 countries in the World Economic Forum's Global Competitiveness report. South Africa’s ranking dropped to 52 in the 2011 report. The reason, he said, was that policy uncertainty has reduced foreign investment flows into South Africa and that discussions about nationalisation and land expropriation were damaging foreigner’s perception of the country.

“There is one statistic that shows it all: foreign investment flows into South Africa this year are 70% down, despite the Walmart deal,” he said.

In terms of possible scenarios for South Africa, Sunter said that "four flags" would give an indication as to whether South Africa would remain a premier league country, drop below a ranking of 59 to become a "poor, but peaceful" country, or worse become a "failed state" which degenerates into violence.

In Sunter’s opinion, the first flag would be the implementation of a nationalisation policy, and that no matter what South Africans think about nationalisation, the country’s trading partners would see it as a negative policy change and lose confidence. “They will see it as a totally and utterly retrogressive step as far as nationalising banks or mines or anything else,” he said.

A second flag would be a clumsy implementation of a national health insurance system. While Sunter said a good implementation would be a positive indicator providing universal access to healthcare, a poor implementation could undermine the private healthcare sector and trigger another exodus from South Africa.

The third flag would be the creation of a media tribunal with punitive powers. “We will trash our brand of democracy at the tip of Africa overnight and we will unleash another wave of corruption as there will no longer be the fear of exposure,” he warned.

The final flag would be land grabs.

“We say these flags are down at the moment so we give a failed state scenario a 10% probability, but in the last six months, we’ve been doing sessions with companies that give a much higher probability to that scenario, some as high as 50%.”

Addressing the builders at the congress specifically, Sunter said that because of economically uncertain times locally and internationally, the building industry would have to become more innovative in terms of business growth. Specifically, he said companies should be assessing their geographical footprint and look at expansion opportunities in the rest of Africa, as well as diversifying their income sources.

“Hard times for five years is a credible scenario. It’s not bad if you can offer value for money as it’s hard times for everybody. So, it means certainly in the building industry you’ve just got to be much more ingenious about your strategies in order to win contracts. It also means you should be looking at annuity income, where you don’t just build but you also contract and manage the projects that you build.”