Mthunzi Mdwaba, chair of Productivity SA, says load-shedding is disastrous for the country’s productivity and competitiveness and devastating for investment.
“These very unpredictable, uncertain bouts of load-shedding, which seem to be getting worse every day, are a disaster for productivity and competitiveness in this country.”
He says they’re a large part of the reason why the latest annual IMD global competitiveness report lists SA as the third-least competitive nation out of 64 that were measured.
Ten years ago SA was 44 out of 64.
“Next year only a miracle will save us from being number 64 out of 64.”
Mdwaba is also CEO of TZoro IBC, an investment, strategic advisory and business consultancy in Sandton, and chair of the SA-Norwegian Association trying to ensure vibrant business between the two countries.
One of the major concerns of potential investors from Norway is SA’s energy situation. Until it is sorted they won’t come, he says.
“Load-shedding, especially its unpredictability, is devastating for investment.”
Next year only a miracle will save us from being number 64 out of 64 [in competitiveness]
— Mthunzi Mdwaba, chair of Productivity SA
He’s finding that more and more South African businesses are questioning their investments in capital expansion, knowing that the operating of these capital assets would be at the mercy of the country’s erratic electricity supply.
Productivity is inseparable from energy security, he says. The fact that the government hasn’t averted the energy crisis it was warned about in 1998 speaks to its failure to put productivity at the centre of everything it does.
“A more fundamental problem than load-shedding is that there is no culture of productivity in South Africa. There’s no appreciation of what productivity is. Ultimately, we are oblivious to the concept.”
This is in spite of the fact that the department of employment and labour is the custodian of the act that created Productivity SA.
He has had serious differences with labour minister Thulas Nxesi over this, which he blames for the government’s recent decision to withdraw its support for his bid to be director-general of the International Labour Organisation (ILO).
“Load-shedding is a huge contributor to our faltering economy and unemployment but the elephant in the room is that we don’t understand that you need a mentality of productivity.”
Instead of placing productivity and competitiveness at the centre of everything they do, ministers are constantly trying to put out fires while the country’s economy continues to deteriorate.
“They’re always going to be chasing their tails because they’re not proactively dealing with the real challenge. They’re not strategically doing things in a productive manner.”
The failure to act strategically has led to the load-shedding crisis the country is sitting with, he says.
It makes a mockery of the president’s speeches about attracting foreign direct investment and improving SA’s ease of doing business. As long as rolling blackouts continue and he fails to make productivity central to everything the government does, none of this will happen.
If there was any understanding of productivity then the National Economic Development and Labour Council, “that useless place where the ministers don’t go”, would be empowered to implement ”rather than talk forever and do nothing”.
If the government understood productivity it would provide real support for the informal and small and medium business sector, which constitutes 65% of the South African economy but receives little more than endless promises.
For the economy to grow there needs to be “positive, constructive support from government, not government interference. Government needs to leave people who know what they’re supposed to do, to do it. I’m talking about private sector enablement, about infrastructure being done by people who know what they’re doing.”
In addition to load-shedding, the reason SA is losing the productivity and competitiveness battle is “because we are caught in an ideological fixation of wanting to make the economy work within an archaic communistic and socialistic framework that doesn’t take us anywhere”.
When you’re having load-shedding that’s messing up your productivity, a Covid that’s stopping everybody from going to work and causing others to lose their work, having protests just to demonstrate your clout is very old fashioned
— Mthunzi Mdwaba, chair of Productivity SA
A recent demonstration of this was the “attention-seeking” strike by the National Union of Metalworkers of SA.
“When you’re having load-shedding that’s messing up your productivity, a Covid that’s stopping everybody from going to work and causing others to lose their work, having protests just to demonstrate your clout is very old fashioned.”
What they should be doing is engaging on how to improve productivity, he says.
There is a failure to understand the need for a correlation between wages and productivity.
“Nobody thought that when you talk about minimum wages you need to correlate them directly to productivity.
“The private sector is playing ball but the government is missing in action and the unions are misaligned and incoherent. For us to get anything done we need a co-ordinated approach.”
What is required from the government is leadership.
“As long as we’ve got a lot of people in authority but no leaders, a government that has no understanding of what is meant by productivity, no understanding of the difference between interventionist programmes and interference, then we’re not going anywhere.”
Too many government policies prevent rather than facilitate productivity.
There can’t be productivity while there’s cadre deployment, he says. “The two are mutually exclusive. We surround ourselves with our friends who know absolutely nothing.”
Another enemy of productivity is putting the interests of a party ahead of the country. “When you’re in government you’ve got to put the country first, and as the president, Cyril Ramaphosa should be leading by example.”
The greatest enemy of productivity is corruption. “You’ve got to get rid of it completely.”
Another major enemy of productivity is the “indecisiveness, discordance and incoherence within the government”.
“You don’t know who is leading who, you don’t know who is in charge. As much as we all love social dialogue and consultation, at some stage somebody needs to put his something on the block and make a bloody decision.”
Public servants need to be empowered to take decisions instead of waiting to be told what to do by ministers “who don’t know what they don’t know. They don’t have a clue.”
There are some very good public servants but they’re too scared to act. “Some of them have people below them who are running rampant because they’re protected somewhere at the head office of the party.” This has prevented the development of a professional public service, without which there can be no productivity.
Mdwaba, who has started several companies, including Torque IT, which he and his team built in 27 different countries, says he is confident of becoming the first business person to lead the ILO next year even without the government’s endorsement.
