Public and private sectors are inextricably connected in South Africa and every other economy.
Public policies, including regulations, taxes and programmes, have a marked influence on the economy and the environment. And the health and productivity of the private sector affects the economy, government revenues and need for government services.
Both government and business are substantially affected by financial institutions and services. This reality necessitates a closer partnership between the two sectors.
It has become even more urgent that government and business foster a symbiotic relationship, given the challenges confronting our country and the world today. Economic downturns occasioned by slow or nonexistent growth, rampant power outages, runaway inflation, rising unemployment, spiralling debt, shrinking household incomes and other factors have direct effects on people’s daily lives.
This in turn causes discomfort within society which could lead to all sorts of catastrophic eventualities. The government cannot create the jobs required to keep the population economically afloat. Continuous conversations between the two sectors should lead to an environment in which the private sector can get as many citizens as possible economically active.
The prime example of why we need government and business to work closely is the current electricity crisis
It is thus imperative for both government and business leaders to realise the urgency of creating platforms for meaningful dialogue that lead to specific programmes and interventions to fix what is not well with our country. The prime example is the current electricity crisis. It has become obvious that the government alone cannot resolve the problem. Private sector involvement in energy security shouldn’t be treated as optional.
While platforms of engagement do exist, there is unhappiness with the government's pace in resolving the issues business raises. The inaccessibility of government leaders at crucial times appears to be one of the stumbling blocks.
With the mounting economic woes and the tendency of companies to reduce or end their investments, frank conversations that lead to lasting solutions have become even more urgent.
Projecting a positive and progressive image of the country to global audiences is a shared responsibility of both the government and the private sector. It requires the nation to pull together to get ourselves out of the undesirable situation we are in.
Economies depend on healthy and honest relations between policy makers and captains of industry. This week Wall Street and markets the world over were on tenterhooks due to uncertainty around the self-imposed debt ceiling and the possibility of a US default.
On home soil, drawn out discussions about a social compact between the government, business and civil society are yet another compelling reason why government and business cannot ignore each other.
Former president Thabo Mbeki has been vocal about the failure of social partners to reach consensus on a comprehensive social compact. His view is that until this key milestone is reached, we will continue on the path to nowhere.
Some attribute the delays in reaching an agreement on this social compact to the historical trust deficit between social partners represented at the National Economic Development and Labour Council (Nedlac).
Just over a fortnight ago, the Johannesburg Stock Exchange hosted a dinner with Deputy President Paul Mashatile and business leaders of the Top 40 JSE-listed companies. I was part of the team that conceptualised the event.
Present were leaders of organised business formations representing their various constituencies. Exchanges were frank and robust as business leaders expressed their frustrations with the apparent lack of commitment and urgency from the government in addressing previously raised concerns that hinder their ability to operate efficiently.
They also offered solutions to many of the problems facing South Africa. They were unequivocal in stating that they are going nowhere, and it’s in our collective best interests to close the gap, actual or perceived, that exists between government and business.
For his part, Mashatile acknowledged the issues raised by business and committed the the government to redouble efforts to resolve them. While this might have provided some comfort, it certainly didn’t eliminate their worries. After all, the proof of the pudding is in the eating.
With that said, not only was it important for captains of industry to get answers from the country’s second-in-command, but it was an opportunity for them to get to know the man who is likely to be the next president. If anything, we need more of these sessions to make better and informed decisions that would help us serve the country better. After all, we only have one country, as one CEO said in our post-dinner reflection.
• Rikhotso is a former government executive and entrepreneur
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