Glacier by Sanlam and Time magazine hosted [The Insiders] on 10 April 2014 at the Johannesburg Stock Exchange in Sandton. BBC World presenter Lerato Mbele moderated the panel of esteemed speakers: entrepreneur and economist Michael Jordaan, political commentator Justice Malala, and chairman of Mauldin Economics and New York Times bestselling author John Mauldin.
The panellists discussed the economic and political landscape in South Africa that affects investors every day.
Malala said perceptions of South Africa globally are not what they used to be. Since South Africa appeared on the cover of The Economist in August 2012 after Marikana, South Africa’s standing in the world has changed, and the ongoing mining sector strikes have made South Africa less attractive to foreign investors.
Mauldin took a different angle. He said, “If you make it difficult to do business, it shouldn’t be a shock if business goes elsewhere.” Jordaan echoed that statement by saying South Africa could be a lot more competitive. He said the fact that Nigeria has become the better economy in Africa should drive South Africa to be more competitive. “South Africa has better infrastructure, better services, just make it easier to do business.”
Mauldin agreed, “You’re not competing in Nigeria, you’re competing in the world. Make South Africa the best, most capital country in the world, and foreign direct investment will come – just look at Singapore.”
Is South Africa an under performer?
“We are under performing unfortunately,” said Jordaan. “We need an entrepreneurial state, and a government that allows entrepreneurs to flourish.”
“You’ve got the raw talent,” said Mauldin, “You need to get out of your own way. Open up free trade zones…open up your energy sector. If we had your rules in Texas we wouldn’t be punching holes in the ground.”
Malala said South Africans can learn from the way Nigerians grab opportunities.
Mbele expressed the concern that the richer South Africa becomes, the wider the gap between rich and poor grows.
Mauldin said, “It’s not equal income you want, it is equal opportunity.” In the US health care is a right. His advice is that as you grow the pie; add rights like health care and education for everyone.
#Nkandla is the new N-word
Malala said, “There is something fundamentally wrong with a society that allows one person to have a house built for R206 million.”
“When you have 7,1 million people unemployed,” said Malala, “economics are a big factor in elections.” He said the reason why the Economic Freedom Fighters (EFF) has so many supporters is because the party is making promises it cannot deliver on.
“Worldwide politics should not be confused with rationality,” said Jordaan, “Voting is emotional.”
Mbele asked Mauldin whether the international world is looking at the South African elections on the eve of our 20 year anniversary of democracy. Mauldin replied, “Yes, people are watching, and wondering why one party still gets such a large percentage. I think the world would be happy to see more competition.”
Mbele’s final question to the panel was, “For a rational voter, what kind of change would they want to see?”
Jordaan said South Africa needs a mechanism for accountability. Malala asked, “What kind of government would be good for South Africa?” He said after the elections Cyril Ramaphosa will be deputy president and he will drive the National Development Plan (NDP), and Pravin Gordhan will stay on as Minister of Finance.
Mauldin has had meeting with politicians in South Africa and in the US, and he said the response is the same. Politicians listen, nod, even take notes, but what do they do afterwards?
“A country gets the government it deserves,” said Mauldin, and in the case of America, “sometimes it might seem that we didn’t deserve very much”.
Download THE INSIDERS 4 summary of panel discussion here in PDF format.
If you would like to follow any of the other stories written on the event, the links are below:
SA must restructure economy – Mauldin
Never equate or trade the words entrepreneur and unemployed
Mauldin, Andrews: SA’s scale ladders everywhere else, why not in SA?
Birthday boy Michael Jordaan: The week that changed my life
John Mauldin on South Africa’s entrepreneurial spirit
John Mauldin – financial expert and best-selling author
Thoughts from the Frontline
SA’s long-term future is in its own hands
Written by Annetjie van Wynegaard