The impending closure of British American Tobacco’s (BAT) Heidelberg plant, and the jobs bloodbath that will follow, is a lesson in the real-world consequences of poor political leadership.
Business Day companies & markets editor Kabelo Khumalo broke the news on Thursday morning that the multinational will cease local production and turn to importing its cigarettes. It firmly blames illicit sales, which it estimates consume 75% of the market.
Further reporting outlined the socioeconomic impact of the move. As many as 35,000 jobs may be contingent on the production network linked to the plant. A significant proportion of those workers have multiple dependants. The detritus of the small and micro enterprises that weave between the complicated supply chains will only be fully assessed in the coming months and years.
Most observers have easily connected the dots of blame to myopic Covid cigarette bans that birthed the flourishing illicit market.
Culpability
First, there is a smoking elephant in the room that needs to be addressed. The above narrative is a convenient cloak under which BAT can slip away from culpability. The circumstances notwithstanding, it is a multinational corporation that will face scrutiny for its disinvestment. It is advantageous for its reputation that the bulk of that scrutiny falls at the feet of state actors.
It is also unusual that the interests of “Big Tobacco” intersect with the views of a publication such as Business Day that is concerned with ensuring South African democracy remains healthy — in all senses of the word.
With those caveats underlined, there is little reason to doubt the severe estimates of the damage wrought by state policy. Or the size of the illicit market that subsequently sprung up.
Emboldened by the powers granted to her by the national state of disaster, then co-operative governance & traditional affairs minister Nkosazana Dlamini Zuma banned the sale of tobacco products at the onset of the pandemic in 2020. Her reasoning was spurious, inconsistent and not backed by evidence. The Western Cape High Court confirmed as much months later when it ruled that the action was unconstitutional and unnecessary.
Fittingly, if frustratingly, her “when people zol” justification became a national joke. (In retrospect, many of the policy calls feel like a fever dream five years later: from the ban on the sale of hot food to arbitrary times for public walks.)
There is no scenario here that puts Ramaphosa in a good light.
As her obstinance on the tobacco issue marched on, it butted directly with the proclamations of President Cyril Ramaphosa, who promised that sales would continue. Her apparent unilateral reversal forced Ramaphosa to backstep and insist that such decisions were being made collectively by the national coronavirus command council.
There is no scenario here that puts Ramaphosa in a good light. He either stood by as a cabinet member wilfully undermined his command or he was complicit in a disastrous, needlessly protracted policy.
This is the dichotomy that has come to haunt his legacy. He has been a president who failed to enact creative change, criticised instead for his failure to restore strong, ethical leadership to a country that badly needs it.
This week brought further embarrassment. Reports suggest that Iran was allowed to continue participating in naval exercises off Simon’s Town in direct contravention of a presidential order. A board of inquiry has quickly been set up to establish how Ramaphosa’s instructions were ignored. Once more, it’s hard to imagine an outcome that polishes perceptions of his authority.
We can’t predict the exact consequences of this flub, but poor leadership invariably makes itself felt. That’s a lesson that the workers in and adjacent to BAT’s Heidelberg production are now coming to terms with.
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