Beyond Covid-19 | Koos Bekker: Turbulence after Covid-19 will force SA either right or left

2020-05-10 06:00
Economic policy needs to change as we imagine a future post-Covid-19. (iStock)

Economic policy needs to change as we imagine a future post-Covid-19. (iStock)

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If South Africa wants to reduce its horrendous unemployment and attract investment it will have to adhere to minimum standards of internationally accepted behaviour. No investment grade country in the world grabs assets, writes Koos Bekker as part of the South Africa: Beyond Covid-19 series. 

Only mamparas will try to predict the outcome of catastrophes.

How could anyone in 1914, on the eve of the First World War, have forecast that it would lead to Bolshevism, Nazism, pacifism, efficient sanitary napkins, commercial radio - and flappers doing the Charleston?  

Now let me prove myself a mampara and venture a few probabilities on our current issue.  

What helps one slightly, is that catastrophes (rather than invent entirely new themes), typically exacerbate trends already latent.

So, at the start of World War I, the car was slowly gaining on the horse. But machine guns proved so effective at mowing down meat that, by the end of the war, horsey was history.   

Koos Bekker: "You grab the soil, you grab the debt." (Media24 Archives.)

How about today and our present crisis? 

Globally, the internet has been gaining on bricks-and-mortar methods.

Chinese tech is maturing into first-rate. We are becoming more conscious of precisely what we eat. All three trends (and some others) will intensify. 

And locally? 

Let’s guess at one. 

Severe turbulence after the lockdown will force the country to choose either left or right at the economic fork in the road.   

How might tensions between ANC factions play out?

Example: for some years now, the ANC has been split. In the one corner, those hoping to continue some smash-and-grab devices of the Zuma era. 

In the other, people who know that - to reduce our horrendous unemployment - this country has to make itself attractive as a destination for international investment. 

READ: South Africa beyond Covid-19: Trends, change and recovery.

Which requires minimum standards of internationally acceptable behaviour. 

How might such tensions play out? 

Well, take a policy like expropriation without compensation.

Supporters of Z forced it onto the official manifesto; thus supporters of C reluctantly had to pay lip service. But they know a few things.

Like that no investment grade country in the world grabs assets.

Also, the whole hoo-ha is not really about that scruffy farmer in his two-tone khaki shirt under the blue gum tree.

Agricultural land is a smallish asset class laden with huge mortgages attached to the soil. 

You grab the soil, you grab the debt.   

Things may turn out well - or badly

A farm needs day-to-day management and, when investment stops, it quickly returns to dust.

But wait: what’s the biggest asset class in South Africa?

Why, listed shares. 

And who is far and away the biggest owner of those? Why, the pension fund of some million-and-a-half honest and relatively well-paid public servants.   

Now how about that?  

For example, to fund parastatal guzzlers. Brilliant idea. 

So when the first mortgaged field of the scruffy farmer in the two-tone shirt gets confiscated without compensation, the last international investor will zip through customs at OR Tambo International Airport.

And the honest government employee realises that the words of Pastor Martin Niemöller during the 1940s apply.

He said, approximately: First they came for the other guy, and I did not object because I wasn’t that guy. Then, once the methodology was proven, they came for me - but by then there was no one left to…

So, things may turn out well or badly. It’s hard to say. Which is not very useful and the sure sign of a complete mampara. 

- Koos Bekker is a serial entrepreneur and non-executive chairperson of the Naspers board. He writes in his personal capacity. This piece was written as part of News24's special series on South Africa after Covid-19.

Read more on:    koos bekker  |  coronavirus  |  pandemic

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