SA’s BRICS Business Council: division vs unity?

Opinion: Why isn’t the financial sector well represented?

STELLENBOSCH: The planned launch of a five-nation Business Council to facilitate trade and development may be a principal take-away from next week’s BRICS summit in Durban. However, the representation on the council seems to lack representation from the financial industry, comprised rather of what one analyst calls “those whom Zuma is comfortable with.”

The council is comprised of five business leaders from each country and will meet twice, says Trade and Industry Minister Rob Davies, under South African chairmanship in 2013. The council,” Davies tells this reporter, “will be a platform for building relationships between the business communities” of Brazil, Russia, India, China and South Africa. The SA council, he says, will gather input from among the 150 executives attending the BRICS business forum the day before the March 27 summit.

The SA council is chaired by mining magnate Patrice Motsepe. Other members are Nomo Majokweni, the head of BUSA, Business Unity South Africa, Sandile Zungu, the head of Zungu investments and spokesperson for Black Business Council, Iqbal Surve of Sekunjalo, the new chief of Independent News and Media South Africa, and Brian Molefe of Transnet. Stavros Nicolaou of Aspen pharmaceutical is the alternate.

Finance Minister Pravin Gordhan, writing in Friday’s Cape Times, stressed the importance of business relations among BRICS countries. With the launch of a BRICS development bank the other main takeaway expected in Durban, Gordhan emphasized the importance of the SA financial sector in developing relationships with the BRICS. He lauded the SA financial services industry, “as one of the most stable and well-managed globally.”

So, why is the financial sector not represented on the business council? Rob Davies dismisses any lack of inclusiveness saying his ministry relied on the principal business associations to put forward nominees. BUSA and the others, he suggested, will speak for the financial sector.

Political analyst Mzukisi Qobo offers a less charitable explanation. “There is,” he says speaking the obvious, “a tension between white-led corporations and the Zuma government.” The council’s composition, says Qobo, is appropriate and not surprising. “These are the people who typically accompany the president on trade missions and with whom he is comfortable.” Zuma not surprisingly, Qobo continues, “prefers to have pliable people around him.” He regards Zungu and Surve as being closest to Zuma.

At Durban it will be interesting to observe the composition of the other business councils. Russian President Vladimir Putin is fond of saying that the interests of Gazprom, arguably Russia’s dominant corporation, and the state are inseparable.

While it will be surprising if the Russians, Chinese, Brazilians and Indians do not include some party loyalists in their delegations, one expects their global business leaders to also be present, no matter their political affiliation. In choosing not to showcase such SA global winners as Discovery, Bidvest and a leading bank to his BRICS counterparts, Zuma reveals much about himself and the way SA is governed.

Nineteen years after democracy SA is still a nation divided against itself. For Zuma and his allies it would appear that SA’s business winners are less cherished assets to be held aloft than ripe fruit to be plucked and transformed.

Foolishly last week Foreign Minister Maite Nkoana-Mashabane emphasised division over unity. Instead of trumpeting the triumph of SA being admitted to the BRICS club she excoriated a private sector leader for observing, quite reasonably, that SA firms in the construction sector will have a difficult time competing with their much larger counterparts from say Brazil or China. Nkoana-Mashabane lambasted Richard Vries, the head of the Gibb consultancy, who had uttered what she took to be offending remarks. SA business she said should stop complaining and go out and compete.

In effect that is what SA business is doing. Regrettably an increasing volume of SA private investment is going elsewhere in Africa where businesses typically feel more appreciated and welcome than in their own country.

Just as the government is distrustful of business, some business leaders doubt whether President Zuma’s government will make a go of either the business council or development bank. Kokkie Kooyman of Sanlam investments fears that the business council is “born dead.” Why, he asks, “will a few bureaucrats be able to facilitate trade when they can’t even get SA’s own development bank to function properly?”


Comments on this article are closed.




Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.

Follow us:

Search Articles:
Click a Company: