Global focus on SA policies

2015-01-25 15:00

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This has been my 11th consecutive visit to the World Economic Forum’s annual meeting. During that time, South Africa has moved from zero to hero and, this year, back to zero.

But I’m returning to Johannesburg with expanded gratitude about living where I do, and am hopeful that lessons learnt this week have exposed realities of a transforming, competitive world to those who need to hear it.

It’s easy to bash Davos. As US faith-based activist Jim Wallis described it, this is the most exclusive gathering of the earth’s “included”. Limos cruise the streets, fur coats – the real thing – are everywhere and you won’t even find this many pistol-packing brutes outside a Bodyguards Anonymous meeting.

But there’s also a very good side to this 45-year-old organisation created by the polymath Professor Klaus Schwab to “improve the state of the world”. Its magnetic appeal to the rich and powerful lies in an ability to attract others of their elite species. Getting them together in a remote place at the same time provides a massive opportunity. Many of them come to listen and learn. As a result, the world benefits.

This has not been the best “Davos” for South Africa. President Jacob Zuma is a very different man to the relaxed, charming person who arrived here in the wake of Polokwane to declare “I’m here to listen and learn”. In 2015, the protective bubble around Zuma has been near absolute.

I was one of 200 people invited to an “intimate dinner of 30 people with the president” and instructed to be at the Kirchner Museum at 7.45pm sharp. It turned out to be neither intimate nor involving Zuma. Strangely, the turnout delighted the host, Brand SA.

On the plus side, the food was good, and I cracked a place opposite Finance Minister Nhlanhla Nene. He is humble, charming, friendly and very open. These attributes resonate with the business community. The two other business sector drivers in Cabinet, Ebrahim Patel and Rob Davies, went out of their way to oblige. Their warm engagement with captains of commerce was positive and surprising. Back home, many in business feel like they are “the enemy”, under constant siege by politicians. As a result, many companies are rapidly shipping investment capital away.

From what I saw here, that may be changing. Nene said there has been a reassessment of proposed legislation, including controversial visa regulations. Zuma’s decision last week to send proposed amendments to the Mineral and Petroleum Resources Development Bill back to Parliament could be the start of much needed change. Nene told me there will be a greater effort to engage “with all stakeholders”.

Despite the predictable propaganda, this year South Africa fell back to a position of benign neglect. Economic missteps driven by naive policy-making have smacked economic growth. With the recovery in developed countries, especially the US, competition for capital has intensified. In that field, South Africa isn’t hacking it. Compared with bold and exciting reforms in places like India, Mexico and Italy, South Africa’s message came across as hackneyed and stale.

I belong to a small group of media leaders who annually get to engage in off-the-record discussions with heads of state. It’s a fantastic format for both sides. Leaders are able to make their case in a relaxed environment, and often allow what they’d said to go “on the record”. We editors get a far better insight into what’s really going on.

The direct contrast was provided by Turkish Prime Minister Ahmet Davutoglu. A short, stocky man with the permanent smile of a skilled politician, he worked the front row of our little group, shaking hands and doing his best to make friends. As Chatham House rules apply, the content of what followed over the next hour stays in the room. But with a recently fired Turkish TV anchor among our numbers, you can imagine why it was one of the most vibrant engagements I’ve seen here.

Former US vice-president Al Gore speaks to the audience during the session How Did We Get Here? Big History 101 in the congress centre at the World Economic Forum this week. Picture: Michael Buholzer

What impressed me about Davutoglu, though, was the vigorous way he engaged on the tough issues. There was much that he said that some of those present felt bent or even broke the rules of truthful engagement. But the key thing is he pitched and engaged, providing a sometimes forceful perspective that many of those present hadn’t considered. It was leadership. Exactly what I’d loved to have seen from a South African president.

Instead, those advising our current leader seem to believe it best to wrap him in cotton wool and restrict public engagements to those he absolutely cannot avoid.

On a related issue, during a session with us, Ukrainian President Petro Poroshenko painted a frightening picture of Russian aggression. He put up a classified map demarcating boundaries agreed to by all parties four months ago. Since then, his opponents have captured 550km2 of Ukrainian territory with the lines ignored by Moscow-backed rebels (he calls them terrorists), and 9?500 Russian troops and 600 tanks now in the Ukraine.

For South Africans, Poroshenko’s description of Russian President Vladimir Putin is alarming. The man whose only friend at the Brisbane G20 meeting was our own JZ was described by Ukraine’s leader as “emotional, one who acts like an emperor – very different from one phone call to another”.

Something that will stay with me is Poroshenko’s warning that over the past 300 years of their intertwined history, Ukraine has learnt that Russia is a “rule maker, not a rule taker”. Those trying to entice it into an enlarged European Union were delusional. Ditto South African public officials expecting a free hand-out on the proposed nuclear power programme.

Putin’s growing isolation highlighted another major theme at the meeting – rising geopolitical tensions. Every year, the forum prioritises the five biggest risks faced by the world. All usually relate to economic issues. This year, three of the five are geopolitical. “The war between states” tops the table.

For me, having been made aware of Putin’s polecat status encouraged a new line of questioning in subsequent meetings. How strong is the alliance between the Brics countries? If the Ukraine conflict continues to escalate, might the Brics be drawn in? Is there a chance that South Africans may be called up to fight alongside Russians?

You can never forecast how these things turn out, but from candid responses by those on the inside track of global political power, Brics is not a recreation of World War 2’s Axis (Germany, Italy, Austria). Economic ties exist and the Brics Development Bank is very real, but that’s where it ends. Every political leader questioned saw zero chance of the Ukraine conflict drawing in other Brics countries (like SA) – and only a very remote prospect of it moving outside of the existing contested area.

So how can I be returning home happy to be a South African?

For one thing, Davos emphasised to us that the world is a very unsafe place right now. Some seemingly intractable problems bedevil large chunks of mankind. Listening to the leader of the interim government in Libya emphasised the enormity of challenges facing some nations.

Another was hearing from Italy’s prime minister how he simply has to roll back inflexible labour legislation after 20 years of zero economic growth and a trebling of the national debt. In both cases, the leaders spoke of current actions being “the last chance”.

Warren Buffett says that in financial markets, you only know who has been swimming naked during the good times when the tide recedes. It is the same in global economies. The oil price collapse and sharp drop in commodity prices has made the world a far more difficult place for middle income, resource-dependent countries like South Africa. Competition for capital has intensified and there’s a realisation that talk is cheap and certainly doesn’t buy the whiskey.

However, South Africa is a long, long way from its last chance. This is no Libya, Italy or even Nigeria. Unless there is a spectacularly dumb political decision around the corner, the county’s geographical isolation is a blessing in the increasingly aggressive world. And with so many examples of how not to do it exposed in Davos, those with the responsibility to make decisions that affect and direct the nation are coming come home better placed to do the right thing.

Hogg is the founder and editor of

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