South Africa can't just flip switch on investors - Maimane
Cape Town - There is something fundamentally flawed in the South African economy, DA leader Mmusi Maimane said at an investment summit hosted by Momentum on Thursday.
"Investors are not just turned on and off. Imagine what load shedding means to a factory. The question is whether SA will also face junk status like Brazil," said Maimane.
"My message to investors is, however, that they can continue to invest in SA as I believe there will be a profound change in the country after the election next year. SA is not as destroyed as some people say. I have hope that businesses can still do well here."
He is worried about a number of bills currently going through parliament due to the impact these will have on investors. In his view Eskom should be moved away from the government sphere to the private sector. He is also against any nuclear energy deal for the country and is in favour of diversifying more into renewables.
His greatest concern, however, is the water crisis facing SA. "It is not just about rain, but also about infrastructure," he cautioned.
"Things are getting tougher and South Africa has a journey before it, facing profound challenges, and a few things have to be done for us to be able to shape a better tomorrow."
The recent mini budget by Finance Minister Nhlanhla Nene tells a worrisome tale, according to Maimane.
"SA will spend more than half its income on public sector wages and they got a 7.2% increase. By next year's mid-term budget SA would have to borrow money just to pay the public sector. SA is, therefore, effectively running out of cash," he said.
"Nelson Mandela had 17 cabinet members, Zuma has 35. It costs R1.2bn just to secure and transport the cabinet."
He also said SA must not only focus on the East for growing trade.
"Why are we turning our back on the West to just focus on the East? I have nothing against trade with China, but we should focus on both the East and the West. About 60% of SA's trade is still with the EU zone," said Maimane.
"I also want to know why Nigeria is importing more wine from France than from SA and what can be done to change that."
Another concern for Maimane is that the youth in SA - of which more than half cannot find a job - are not just unemployed, but many are actually unemployable due to a bad education system. He is in favour of a system where learners will be channelled in grade 9 either further on to matric and then to university or to become artisans depending on their aptitudes as he pointed out that SA is also in need of skilled artisans.
The power that teachers' unions wield in deferring assessments of teachers must be removed, in his view.
"We don't need unions to be heroes. Small businesses - the creators of jobs - should be seen as heroes," he said.
Crime is another challenge to be addressed.
"Highly skilled people from abroad do not want to come and work in SA, because of crime. Fewer Brits also came to SA during the 2010 Fifa World Cup than to any other previous world cup - they feared crime," said Maimane.
"On the other hand, what is still right in SA is the banking and financial sector and our strong courts."
He admitted it will be a "tough project" to build a non-racial SA due to the current inequality which is still very much based on race.
During question time he was asked whether the DA would ever consider a coalition with the EFF after the next election. He said one would have to wait and first see what the next election brings, but added that the DA and EFF differ on fundamental issues like having a market based economy, non-racialism and cadre deployment.
"The EFF is actually just the ANC in drag," said Maimane.