With just three weeks to go before 4 723 ANC delegates decide on South Africa’s future, Moneyweb editor Ryk van Niekerk interviews Themba Maseko, director for communications at Business Leadership South Africa, on what kind of leader business needs to get South Africa’s economy back on track.
RYK VAN NIEKERK: With me in the studio is Themba Maseko, he is the former director-general of the department of Public Service and Administration, as well as public works, he was also a former spokesperson for government until 2011 when he stood up against the Guptas and he was sacked. But he now wears a new hat; he is the director of communications at Business Leadership South Africa. Themba, welcome to the show, how does it feel to wear a private sector hat and an important one at that?
THEMBA MASEKO: Well, it feels quite good, I now have the opportunity to interact with the top 80 CEOs in the country and I’m quite amazed to find that these are true South Africans in every sense of the word. They are people who have set up large corporations who are truly committed to South Africa, they want to make a difference and they wanted me to partner with them to make South Africa a better country for all and I really welcome and appreciate the opportunity to work with them.
RYK VAN NIEKERK: But since 2011 you have also been an entrepreneur and in business, you ran your own company, tell us about it.
THEMBA MASEKO: I was part of a very small company that had interests in IT, particularly biometrics. It was a business that was set up by an old mate of mine and we sold that business about three years ago to EOH. I was looking for new opportunities and BLSA came to the party.
RYK VAN NIEKERK: But let’s talk about BLSA, it represents the big businesses in South Africa, the big names, the big entrepreneurs, how much interaction is there between these CEOs or is it a few individuals who drive it?
THEMBA MASEKO: It’s a very interesting organisation because when I came onboard I was wondering if these CEOs would have time to pay attention to the issues that BLSA wanted to focus on but when I joined the organisation I was amazed at the amount of time that these CEOs, we’re talking about the CEOs of Investec, Discovery, Standard Bank, Anglo American, AngloGold Ashanti, all of them making themselves available to deal with the issues that are actually facing that are actually facing the nation. We’ve got a council that’s made up of 80 CEOs and they attend meetings at least every six weeks. We’ve got a small board of about 12 CEOs and they also attend meetings, they respond to emails, they are really dedicated and committed to making a difference. They interact on a regular basis and I think they are going to make quite a big difference in our country.
Interaction between BLSA and government
RYK VAN NIEKERK: How much interaction is there with the government?
THEMBA MASEKO: At this stage I would say there is a bit of a trust deficit between business and government. There are formal structures that have been set, for example at Nedlac there are formal meetings that happen and from time to time there will be delegations either from BLSA or Busa meeting with business but there’s a trust deficit. If you look at the major debates taking place around the country you’ll find government pointing fingers at business and business pointing fingers at government, and I think that’s a very unhealthy situation at this stage. But from a business point of view, we fully understand and expect that there needs to be a very strong partnership between business and government because we believe that the country’s economy is facing a serious challenge at this point in time. There’s high unemployment, growth has slowed down quite substantially, there’s poverty, there’s inequality in society and the only way we can get over those challenges is if government and business get into a very strong and solid partnership to actually get this country back on track. There isn’t enough interaction taking place from a government perspective.
If I was, for instance, a minister of finance I would keep very close relations with a structure like BLSA because BLSA talks to top business leaders and tries to find solutions with them and at this stage, that is not taking place. I’ll give you an example about Davos that’s taking place in the new year, I would have expected that by now government and business would have sat down to discuss what we are going to tell the investment community, and at this stage there have not been any preparations between business and government and that’s something that is a bit of a worry for me. In short, the relationship is not as it should be, I think there needs to be a much closer relationship between government and business.
RYK VAN NIEKERK: When Pravin Gordhan was still minister of finance there seemed to be a lot of interaction, is it fair to say that from the treasury side there’s a reduced interaction since Malusi Gigaba took over?
THEMBA MASEKO: I think that the interaction is not as it should be, during Pravin’s time there were quite a number of initiatives that were initiated, there was a youth and employment scheme that was put together by government and business. There was also an SME fund that was created where government was supposed to put R1.5 billion towards supporting SMEs and business was supposed to match what government was putting on the table. At this stage business has put its R1.5 billion aside and the SME fund is just about to launch but government has not come to the party and that initiative seemed to have slowed down when Pravin left government and we’ve not been able to get government to come to the party fully. But attempts are being made to improve the relationship because as business leaders, we believe that government ministers can promise all kinds of things, including creating jobs. But the people who really create jobs is the private sector and government needs to recognise that and begin to work with business to make sure that happens. So at this stage, the relationship between treasury and business is not where it should be.
RYK VAN NIEKERK: But it needs to be resolved, Jabu Mabuza said some very critical things about government and he also did not accompany team South Africa to the recent discussions with investors in New York. Do you see with the current leadership an improvement in that relationship?
THEMBA MASEKO: What we as BLSA are doing now is to try and talk to as many of the candidates at the ANC conference who are standing for the presidential elections, with a view to making sure that when new leadership is elected in December there is a better understanding of the role of business. So we’re making an appeal to them to say our economy is facing many challenges and whoever gets elected in December things need to be put in place to make sure that there’s a better relationship with business. We are really looking forward to working with the new leadership of the ANC but, importantly, getting them to understand the importance of working with business. We had an interaction, for example, on Thursday our council had a session with Zweli Mkhize and we are making overtures to meet with other candidates to just make that point of let’s work together, guys. There’s a lot that needs to be done and we need to put the economy back on track and we need government to come to the party and as business we are willing to play our part but we need to see government also sending the right signals to say they need to work with us.
Meeting the ANC leadership candidates
RYK VAN NIEKERK: Have you met with Nkosazana Dlamini-Zuma and Cyril Ramaphosa?
THEMBA MASEKO: We have sent requests for meetings as BLSA and as Busa and we are still waiting for responses from them but we are keen to meet with all the candidates.
RYK VAN NIEKERK: Many private sector leaders would prefer Cyril Ramaphosa to become the next ANC president, does BLSA have a preferred candidate?
THEMBA MASEKO: Our view is that we are not going to participate directly in the election process of the ANC. Our view is simply that whoever gets elected must be someone who is business-friendly, someone who understands that the biggest challenge facing this nation is growing the economy and somebody who is not going to see business as the enemy of the state or of the people. It needs to be someone who is going to say I’m going to work with the private sector to make sure that we bring the economy back on track. But as far as a preference of an individual we don’t think that’s our place to choose.
RYK VAN NIEKERK: But do you think, hypothetically speaking, if Cyril Ramaphosa becomes the ANC president next month do you think it will make a massive difference immediately with confidence levels between the private sector and government?
THEMBA MASEKO: Our view is that all that needs to be done is to get leaders who will send the correct signals to the business community and the investment community because sentiment at this stage is not very positive because of a number of issues, especially policy uncertainty, attitude towards business, the regulatory environment that we are finding ourselves in, but we think that whoever gets elected in December and sends the right messages then business sentiment will change, it’s not going to be complex. But the question is whoever gets elected in December is going to have the guts to make the kind of messages that the nation expects of them. It’s a complicated matter, it depends how the total leadership of the party is going to be constituted because it’s not just an individual, it’s also the other leaders who are going to be in the top six, in the NEC and so on. So it’s going to have to be somebody with very good leadership skills to juggle around and make sure that he or she pulls the whole team behind them to make sure that the right messages are sent out.
RYK VAN NIEKERK: Business Leadership has conducted several research studies in recent times highlighting big business’ commitment to investing in South Africa, the number of employees they have and the critical role they play. Why did you do that, it seems to suggest that there is not a comprehension or an appreciation within government of the role the private sector plays in the country.
THEMBA MASEKO: There are many discussions and debates that have taken place in the country, which suggests that business is not interested in growing this economy. So with that research, we wanted to just demonstrate to government and to other business players but also to the public at large that, in fact, business is actively involved in investing, creating jobs, paying its taxes. In other words, business believes in South Africa. So we wanted to address that myth that business is just out there to make a profit. Yes, profit is important but business is also interested in the wellbeing of this nation. So that research was basically trying to demonstrate that we are making a contribution, we are a big player and government needs to listen to what business has to say because we are already making a significant contribution to this economy.
RYK VAN NIEKERK: The private sector is not always the angel, obviously we look at transformation, we look at inequality, we look at the impact the white monopoly capital narrative made, do you think the private sector is doing enough to address those issues?
THEMBA MASEKO: We are doing a lot as BLSA, for example we have come up with what we call a contract with South Africa where, as members of BLSA, we are making certain commitments that we are going to be embarking on programmes to make sure that the process of transformation is accelerated within our companies, that we are going to do a lot to try and support small business through a lot of enterprise development programmes that we’re already doing as companies. So, in other words, we are making commitments through that contract to say we are not just going to be waiting for government to set targets but we are going to set targets that we will exceed and targets that will be even higher than what government is expecting to demonstrate that we are truly South African as business and we have an interest in transformation just as much as government has. We have also published and we are getting our members to sign an integrity pledge, noting that with the advent of corruption and state capture there’s a lot of corruption and, in fact, the private sector is not totally clean as far as that is concerned but we are saying that our members will sign this pledge to fight against corruption and state capture. If any of our members are implicated in that we will act as BLSA but the narrative such as your white monopoly capital are problematic because they suggest that business is the enemy of the public and we want to contest that, we want to demonstrate that business is truly South African or committed to this country and we are going to do whatever is necessary to play a positive role.
Government’s strategy for Davos 2018
RYK VAN NIEKERK: Just coming back to your remark earlier regarding your discussions with government on a strategy for the Davos meeting early next year, it seems to be very concerning because it is one of the premier platforms on the annual calendar, where a country can actually put forward a unified face.
THEMBA MASEKO: We did something very interesting ahead of 2010, where government and business went to the world and said we’re going to run a successful campaign with a common message as business and government. We think that with the challenges we are facing, especially with regard to the need to grow the economy, attracting investment, fighting corruption and state capture, we need to be sitting around the table as business and government to say what are we going to tell the investment community so that we can attract foreign direct investment back into the country. We are hoping that over the next few weeks that government will come to the party to make sure that meetings are convened between government and business so that we can send common messages. So we are already sending requests to the minister of finance to say let’s sit around the table and plan for this. As a communications person I see this as a very important platform that we need to use to turn global sentiment around so that we can get foreign direct investment.
RYK VAN NIEKERK: But what happens if that doesn’t happen?
THEMBA MASEKO: If that doesn’t happen then the business community is going to have to get its act together and make sure that we prepare a message that we communicate to the world and hopefully that message will be supported by government as we get closer to Davos. Hopefully that will still happen because we still have a few weeks to go.
RYK VAN NIEKERK: But the rift within the ANC seems to have the different factions solely focusing on the ANC leadership race and this won’t be solved post the elective conference. How do you foresee the short and medium-term impact the political infighting may have on the economy?
THEMBA MASEKO: Internal political dynamics within the party is of great concern but also a great interest to both the business community, the public and the investment community. We are starting to hear some positive noises being made from some of the candidates and a lot of them are beginning to say we’ve got to unify the party. Our biggest concern at this stage is that conference must take place and it must be a successful conference and that it elects leaders who have a clear commitment to fight corruption, state capture but also bringing the economy back on track. So it’s a lot of work that they need to do as politicians but we are looking forward to them having a successful conference that’s the most important thing. When a successful conference happens, and good ethical leaders are elected in December, I think that we then have a greater chance of turning business sentiment around and we are very optimistic that will happen. That is why we are meeting with the candidates to just say please make sure that the conference happens and that it elects very ethical leaders.
RYK VAN NIEKERK: Cyril Ramaphosa said in Soweto last week that business confidence can change very quickly and if the confidence returns we can see a quick acceleration in economic growth, do you agree?
THEMBA MASEKO: We agree 100%, the issue of business sentiment is something that can be turned very quickly by government just sitting back and saying what are the noises that have made investors worried about this economy. If the leaders are elected in December and they begin to just bring policy certainty in certain sectors, for example in mining, all the issues about the fact that there’s almost a war between the mining industry and the minister of mining largely because you have a minister who is very intransigent and, therefore, business leaders are uncertain about what’s going to happen in the mining sector. All the government and ANC leaders need to say is we are going to talk to business, this is the agreement that we’re going to sign with business, sentiment will turn almost overnight but clear commitment needs to come from government to say we will work with business and stop seeing business as the enemy of the people.
RYK VAN NIEKERK: The mining sector is always referred to as an example of this policy uncertainty and the impact it has but it’s only 5% of the current economy…
THEMBA MASEKO: But it’s a good example, let’s take another area of policy uncertainty, for example the minister of finance stands up in Parliament and says there isn’t funding for nuclear. The minister of energy then stands up and says no, no, there will be nuclear investment. We know what impact that’s going to have on the fiscus, if the minister of finance says there isn’t money in the fiscus to fund a nuclear programme, at least over the next five years, and then you have the minister of energy saying nuclear will happen, already you are creating uncertainty in the marketplace. If the fiscus is not under control that’s going to have a direct impact on the fiscus and that’s the worry that we’re talking about and there are many other examples. But mining, nuclear and there could be other areas that…
RYK VAN NIEKERK: Land reform.
THEMBA MASEKO: …land reform, there are many other areas that we believe government is not managing the policy environment properly and largely because the focus at this stage is the faction fighting, the conference and very little attention is being paid to policy issues that are having a direct impact on the economy. So sort out the internal political dynamics, let’s focus on growth, let’s focus on the economy, let’s clarify important policy issues and I think business sentiment will turn.
RYK VAN NIEKERK: Just lastly, BLSA represents the big companies in South Africa, 80 of them. Busa represents more regional businesses, do you think business is unified enough to present an objection to what is currently happening?
THEMBA MASEKO: Business leaders [are] interacting and working quite well, Busa is the apex organisation, BLSA is part of Busa, we’ve got a number of initiatives such as the CEO initiative, where CEOs of companies that are members of BLSA, Busa and all the various chambers of commerce that exist around the country, so you’re finding individual companies, individual business leaders working together. On the structure side I think there’s a bit of work to be done, for example there’s the existence of the Black Business Council, which is not participating fully in Busa. So the issue of business unity still needs to be put on the table to make sure that we can speak with one voice and not become victims of the factional fighting that’s taking place at a political level. So yes, some work is being done in that regard but I think business leaders are very clear about the need for cooperation.
RYK VAN NIEKERK: Thank you, Themba, for coming into the studio. That was Themba Maseko, he is the director for communications at Business Leadership South Africa.
This story was first published by Moneyweb and is republished with the permission of the editor.
Ryk van Niekerk is editor of Moneyweb. He has 18 years’ experience as a financial journalist. Before joining Moneyweb, he was the national editor of Sake24, Media24’s national financial daily.