Denis Worrall is Chairman and founder of Omega Investment Research, an international marketing and investment promotion business with offices in Cape Town and London, established more than twenty years ago. To see how Omega can help your business visit www.omegainvest.co.za
2009 has ended more or less on the same note it began. That means the spotlight is on the ANC, Cosatu and SACP Alliance. And the dynamics of the alliance have also been at the bottom of most important events and developments in South Africa over the past 12 months - and I have to add an eventful 12 months it has been.
It was of course an election year. A year which saw also a change in national leadership - from Kgalema Motlanthe to popularly-elected Jacob Zuma; a heavy debate about macroeconomic policy; a dangerous tendency to involve the highest court in the land in what Americans describe as the "political thicket" - invariably to the political advantage of Jacob Zuma and to the disadvantage of the judiciary and the constitution. But to highlight some significant developments which will shape politics and economics also in 2010:
1. 2009 saw the emergence of a breakaway party from the ANC. Representative of politicians and business people associated with Thabo Mbeki, and reflecting professional and middle-class values, Congress of the People (COPE) disappointed in the April election with less than 8% of the overall vote; and at year-end there is much talk of an opposition alliance around COPE and the Democratic Alliance (DA), which garnered 16% of the vote in the election. The DA has performed magnificently in Parliament, with its leader Helen Zille coming out of 2009 (in my opinion) as the most imaginative, consistent and personally attractive politician in the country.
2. There was never any doubt that the ANC would win the election, which they did with 3% less votes than in 2004 and something short of a two-thirds majority. But the SACP and Cosatu were also winners - with President Zuma recognising their support in his election as president of the ANC, and hence appointing leading members to cabinet positions, with the SACP gaining effective day-to-day control of Luthuli House, the alliance's party headquarters. Since the election, the SACP has increasingly tried to influence policy decisions in respect to the economy and generally the adoption of a more interventionist approach. In fact, the tensions at year-end revolve as much around ideology as they do personalities. One leading newspaper spoke of "the delivery of divorce papers" but if the SACP can help it that won't happen.
3. One consequence of the ANC Youth League's push for influence, and the lack of response until very recently at all levels of the alliance, has been a lamentable dumbing down of our politics. Outside the print media, political discourse - the heartbeat of democracy - has gone to the dogs. Julius Malema's lamentable attacks on Frene Ginwala and Kader Asmal - both persons with an illustrious record of service to the country - illustrates the point.
4. An interesting trade development in 2009 is that the four BRIC countries have become Africa's biggest trading partner - with prospects of this greatly increasing if (the experts say) African states take more initiative in growing the relationship. South Africa, aside from being a major beneficiary, clearly has a role to play here - especially in reducing some of the obstacles to intra-African trade.
5. In October UK Trade and Investment, the British government's international business development agency, identified South Africa as a key emerging market for global investors. The report was released by Lord Mandelson. Among other things it stated: "By establishing a business in South Africa, UK companies can gain a foothold into sub-Saharan Africa."
6. The Eskom saga, while itself a limiting factor on future energy-absorbing projects, highlighted the crisis among other parastatals - including SAA, Denel, Armscor, the Land Bank and even to some extent Transnet, the biggest of the state enterprises. A big part of the problem is a lack of professional and managerial skills and experience.
7. An encouraging recent development is the decision of so-called Big Business to play a more active role in responding to national issues and contributing to policy decision-making. While for some years business has assisted with combating crime behind the scenes, there are so many issues where business can make a contribution - among them service delivery, mismanagement at state enterprises, unemployment (South Africa lost over 800,000 jobs in 2009), healthcare, vocational training, and the promotion of entrepreneurship to mention a few. Incidentally, the main catalyst for this development is Bobby Godsell.
8. How to assess Jacob Zuma's leadership? His appointments have generally been good - with the notable exception of National Director of Public Prosecutions (NDPP) Menzi Simelani, which was a shocker. Of special interest was his appointment of members of the so-called "economic policy cluster" - Gill Marcus at the Reserve Bank, Trevor Manuel as Chief Planner, Pravin Gordhan as Minister of Finance, Ebrahim Patel at Economic Development, and Collins Chabane Minister in the Presidency. Although the ANC Youth League may have said: "To hell with competence - this is not black enough!", President Zuma, admittedly after some dallying, stood his ground, cleared away the initial uncertainty regarding specific roles, and confirmed that there would be no major changes in macroeconomic policy. And six weeks ago Zuma's stand on HIV/Aids removed all uncertainty regarding the government's position which may have carried over from Thabo Mbeki's presidency.
Dr Denis Worrall
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