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The future of South Africa through the eyes of Justice

South Africa through the eyes of Justice

Highly regarded commentator, Justice Malala sees flickers of hope for South Africa, and praised institutional improvements and recent events like the VBS arrests.  He shared his views in PSG’s latest Think Big webinar, hosted by Dan Hugo, Chief Executive of Distribution at PSG. 

“Despite everything, South Africa continues to have so much potential, but it’s up to us as South Africans to get it right and unlock this potential,” Hugo quipped.  “In uncertain times, a highly-skilled financial adviser can help you see the wood for the trees.”

The ANC support shift

Malala sees serious potential for a turnaround in political power. After almost three decades of ANC dominance,  election results showed dwindling support for the party in 2019, with only about 11 million votes for the ANC out of a potential 36 million. Local elections are seeing a poorer turnout as many voters don’t believe in the ANC anymore, but the great tragedy is the failure of strong opposition.

“We feel disillusioned; the move away from the ANC has already happened, except it didn’t go anywhere but stay home, and in most places, the ANC now needs a coalition partner,” Malala said.

There also needs to be less impulsive leadership like when Jacob Zuma announced in 2017 that there would be free education for all, without knowing where the money would come from. “Ace Magashule is doing the same thing now and the younger generation needs to recognise this.” There should be no more false promises, and time is of the essence.

“We can’t afford to waste time, it’s not infinite. Ramaphosa is in his third year as President, which would mark the end of the road if these were US politics, and so the opinion writers, the assessors, the political correspondents are saying ‘what is his legacy’? The problem is we are still talking about whether he has enough power to implement anything,” Malala said.

But for Malala, an even bigger problem is the turnaround time on simple issues. “Loosening visa regulations to allow skilled workers to enter South Africa as an example, needn’t have taken so long to sign and pass through.” Getting this right earlier could have brought in much needed assistance to state-owned enterprises like Eskom, as well as benefitted the economy.

Stop wasting time

President Ramaphosa is a gradualist, but Malala feels he should’ve been clearer on the time limits we face. “Another thing to resolve is the support for him within the ANC.”

The brokenness is not just the system that Ramaphosa inherited, it’s the party that he won. “The corruption runs so deep and the ANC guzzles cash, which is why getting the Political Party Funding Act through is so important. It means you or I can say I am giving R100 to the DA, R100 to the EFF and R100 to the ANC, and we no longer have to do it in the dark, the tax man will know. It means that a lot of money that was previously unaccounted for can no longer be hidden because if it’s over R100 000, it has to be declared, or it’s a criminal offence.”

The cost of the Zondo Commission

One may wonder about the cost of the investigations, let alone the sum of missing money.  “A lot of people will say there are kids at UCT, Wits, all across the country, saying ‘we don’t have money, we want to learn but we can’t afford it’. People are saying take that billion towards the Zondo Commission and give it to the kids. But the reason we don’t have money for those kids is because we didn’t do things like what is now happening at the Zondo Commission. We need to clear out the stables and this is part of it, and it’s money well spent, and we need to continue to spend because quite frankly, if we don’t show that these things will see the light of day, we will never defeat them,” Malala said.

The justice that has been served thus far will discourage further corruption because of the consequence of getting real jail time. Sorting out the mess and getting ourselves out of the red may even mean no additional wealth taxes are needed. There will be huge benefits to sorting things out, even if it will take faith and patience.

Accountability and consequence that lead to change, will also lead to building confidence, which is what South Africa is so sorely lacking. The crisis of confidence is impacting international investment, particularly because South Africa is a long-term investment case of up to two decades.

“But investors want to be confident that the timeline will actually play out. So, we need to fix politics to truly improve the result.”

South Africa is far from out of the woods.  Political drama aside, our national debt is set to be in the region of R5 trillion by 2024/2025, provided things go well. “And it’s hard not to focus on these extremes but when we think it’s going to be disaster, it’s an absolute disaster, and we don’t see the middle most of the time,” Malala said.

“I think we’ve come so close to disaster. Many people may criticise President Ramaphosa for promises not kept, but in the case of the Covid-19 pandemic, my view is that we came very close to a disaster and that we turned it around, even though the road to recovery, including economic, is still far ahead.”

See the upside in downsides

The lack of confidence in South Africa externally may be rooted in the internal lack of confidence locals feel. There are many things to fix but there is hope on the horizon. “We need to see confidence build. Let’s see Covid-19 vaccines happen for all. That is one way to bring confidence to the domestic market,” Malala said.  “The key is to build confidence in our own people, our own business community and we have to acknowledge that it’s one thing to talk about it, but we’ve got to see it for the message to get through, to start believing it too.”

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