SA is on the brink of an “economic emergency” due to its runaway unemployment crisis. Reflecting on President Cyril Ramaphosa’s meeting with US President Donald Trump, Hendrik du Toit, CEO and founder of SA’s largest fund manager, Ninety One, said the visit highlighted SA’s socioeconomic ills.
Du Toit said SA should be proud of the inclusive delegation that represented it in Washington, but SA clearly has to move at pace to deal with lawlessness and corruption while embarking on a skills revolution to get the economy growing.
“We have to operate in a world where Donald Trump is the president of the US, and I think President Ramaphosa understands this. I was incredibly encouraged by the way John Steenhuisen backed up the president and clearly articulated government policy on land,” Du Toit said.
SA should focus on growing the economy, he said. “SA is on the brink of an economic emergency, given the unemployment numbers. We need to deal with unemployment to give economic hope to the citizens. We need to do this together in a world which is much more hostile.”
Pushed back
SA’s high crime rate became one of the issues that took centre stage at the televised meeting, with Trump claiming there is a “white genocide” in SA, particularly of farmers. The SA delegation, made up of the country’s richest person, Johann Rupert, golfers Ernie Els and Retief Goosen and several ministers, pushed back on the claims.
Du Toit also poured cold water on the “white genocide” misinformation, which has found its way to the world’s most powerful office — the Oval Office.
Du Toit said the united front presented by the SA delegation bodes well for what could be done in future. “I saw SA holding hands. I saw a government of national unity that could face outward and understand that there are threats from the populist side in SA, which needed to be dealt with. The meeting also showed we are starting to face up to our challenges, and that is really important.”
Michelle Gavin, a senior fellow for Africa policy studies at the Council on Foreign Relations, a US think-tank specialising in US foreign policy and international relations, said Trump clearly believed there was a receptive audience for his claims about genocide in SA and his administration’s high-profile rush to resettle white SA “refugees”.
“He is fond of performative displays of power, and may see SA as an ideal place to make the point that the US will punish weaker states that do not align with his preferred positions. The likely consequence of this policy direction is not good news for the US. US businesses operating in SA will suffer alongside SA enterprises,” she said in a note, reflecting on SA’s visit to the US.
“The result will be greater SA enthusiasm for China and Russia, and economic headwinds that will politically advantage SA actors that are far more hostile to America than the current SA government,” Gavin said.
“Ramaphosa needs some positive economic news for the SA people, who confront high unemployment, tremendous income inequality and sluggish growth. The end of duty-free access to the US market for some SA exports will not devastate the SA economy, but it will bite.”
Trudi Makhaya, a partner at Boston Consulting Group, said SA still had a lot to offer on the global stage. “SA is the continent’s most sophisticated economy, with deep linkages to other economies in the region and the continent. Constructive trade relations benefit not only SA but also have wider ramifications for the continent.”
“SA is home to multinationals and foreign companies, including more than 600 American companies, that present proof points on how businesses have capitalised on the economic opportunities presented by the country while navigating its evolving regulatory environment.”
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