You are currently viewing our desktop site, do you want to visit our Mobile web app instead?
 Registered users can save articles to their personal articles list. Login here or sign up here

We need to move from we ‘will’ and ‘must’ to we ‘have and did’

Government needs to pull the trigger on tough decisions.

The new weekly communication from President Cyril Ramaphosa is refreshing. From the first few editions, it seems he appreciates the concerns of South Africans. It is also in stark contrast to the previous administration, where the flow of information was probably actively restrained.

But the word ‘must’ appears seven times in the text of the most recent communique. The word ‘will’ appears no fewer than 11 times. These words are all used in the context of the government’s appreciation that so-called tough decisions to fix Eskom and other economic challenges ‘must’ and ‘will’ be made.

The tone of the letter is positive, but it lacks references to examples of recent government interventions which ‘have’ had a positive impact on the economy and its growth trajectory. The reason is that there are no examples to give.

Eskom

Eskom remains the single largest fiscal threat to South Africa. And despite many promises from the president, he is yet to release a restructuring plan or appoint a permanent CEO of the utility.

Read: Ramaphosa says Eskom’s financial position ‘remains untenable’

From the latest letter, it is clear that the president knows what ‘must’ happen. The following paragraph in his letter spells it out:

“As government, we ‘will’ continue to do all within our means to restore the viability of Eskom. Tough decisions ‘will’ have to be made. There ‘will’ have to be trade-offs. All sectors of society, especially government, business and labour, ‘must work together to bring this crisis to an end’.” (Author’s emphasis.)

I think the sands of time for these tough decisions have virtually run out. I am a big supporter of the president and firmly believe that he will play a critical role in changing the economic, moral and reconciliation trajectories of our country. However, the time for promises is over; we need to see the tough decisions being made.

Litmus tests

In the eyes of local and international investors, there are two litmus tests on whether Ramaphosa can turn South Africa around.

The first is to arrest and jail corrupt government officials and ANC members. At the very least, senior ANC officials such as Ace Magashule must be suspended, pending investigations. (I hope the president reads Pieter-Louis Myburgh’s ‘Gangster State’).

The other litmus test is Eskom. If the Ramaphosa administration can undo the damage of his predecessor’s corrupt networks, it will instil significant confidence that the tide is turning for South Africa. 

Eskom is a case study of how Zuma destroyed a once internationally envied institution with corruption, cadre deployment and the breakdown of corporate governance structures. (In many countries such conduct may be seen as crimes against the state, maybe even treason. But that is a column for another day.)

The tough decisions ‘will’ have to include a significant private-sector-like restructuring of the company. Its ‘imminent’ unbundling into three entities ‘will’ be a good start, but it ‘must’ be accompanied by the slashing of the workforce, reduction in salaries, the sale of assets such as power stations – most notably Medupi and Kusile – and the closure of inefficient ones.

Read: Load shedding: How did it suddenly get to this?

Eskom should also sign electricity procurement agreements with independent power producers.

There is still time …

The coming two weeks will be critical for South Africa as the announcement of a rescue plan for Eskom and the appointment of its new CEO are expected.

On October 29 South Africa will also hear from Finance Minister Tito Mboweni how deep, black and wide the hole in which Eskom finds itself is. That day may be a sombre one, as the news ‘will’ most definitely not be good.

It will also be interesting to see the extent to which the private sector will be involved in the turnaround.

These announcements may represent a final opportunity for the president to announce that tough decisions ‘have’ been taken. It may well be the last chance he has to keep local and international investors’ attention. It will also allow him to use the phrase ‘we have’ in his future communique … South Africa needs it.

Hopefully, we will see such a communique before the end of the year.

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

AUTHOR PROFILE

COMMENTS   20

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

You in dreamland- too late. Where in Africa has anything been fixed ever.

Rwanda seems to be the new hotness of Africa

Because they have Kagama as a leader not some dithering commie

Again… we must, we should, we could…

Cyril, seriously, KEEP QUIET until you actually accomplished something. You are beginning to look ridiculous.

Oldest problem in the book: The sales team promises what the Implementation team can’t deliver.

This is a super negative comment but I don’t think the ANC can implement even if they dearly wanted to. You just cannot treat a country like they have and then think there will not be severe consequences. Too many of the skills needed to deliver have gone (including more and more skilled Blacks) and not enough left to do the corrective work needed. It can only get worse and there is no way around it.

I support your opinion with the fact that our education system is now in ruins(On purpose). So people you have around cannot even properly diagnose and fix problems because they are not educated in basic fundamentals. The experts have left the country. Kusile and Medupi were raped by the American engineering companies whereas GROUP 5 were building a Power station completed in 5 years in GHANA. So why could group 5 do it and here we are years over time and budget with these YANKS and designs are wrong at Medupi/kusile and and and….the USA are robbing this country and others blind. SASOL another example is being raped by an american CEO and its Lake Charles Project. Look at how many companies on the JSE have had so much wealth destroyed and taken away by foreigners. Rampaphosa is a pawn for these overseas powers that be. Let me remind you of the US CEO of SAA who sold all the planes and then leased them from Boeing…how much money didnt he make out of SAA…..there are so many examples of the yanks plundering our companies and this countries reseources.

What was that about colonialism again?

It is hard to stifle an economy to death. It takes time and concerted effort by socialists and communists to slowly, but surely bring every little piece of the economy under government control and then throttle it with inefficiency, corruption, legislation and lack of leadership. All of these are now perfectly in place in South Africa.

Cyril has no power to act against the forces of socialism in South Africa. The political will is solidly founded against the economy in a country where the majority are economically illiterate. Even the leadership does not understand that the only way to improve South Africa for everybody is to growth the cake as quickly as we can. Forcibly cutting the cake differently with legislation, jobs in SOE’s, etc. just results in more capital leaving the cake.In all shrinking economies the poor suffers the most.

I so wish this could be different.

“The reason is that there are NO examples to give”. That sums it all up. And still ……NOTHING HAPPENED.

“We are ready to accept almost any explanation of the present crisis of our civilization except one: that the present state of the world may be the result of genuine error on our own part and that the pursuit of some of our most cherished ideals has apparently produced results utterly different from those which we expected.”
― Friedrich A. von Hayek, The Road to Serfdom

Making the right noises at least. The vocabulary is there – let’s wait and see.

Our man here is trying to pick the middle road with everything he does.

Its quite simple. If he wants to include unions and communists in the “tough” decisions that has to be made that’s fine, but you can not have them make the decisions for you. It will be the wrong decision. How difficult is that to see?

Around 27000 people has to be fired from ESKOM to fix it. If you don’t do that it shows the intention is not to fix it but to botch it.

Sometimes we should NOT all work together. Just do what it takes. Why should over 50 million people be held to ransom by a few unionists???

Exactly. The increase, just the increase, in the number of unemployed over the last decade is not much less than the total number of union members. The excess headcount in Eskom represents 1% of those additional unemployed.

Cosatu is a special interest lobbying group and its influence over policy should be commensurate with that.

Seriously why bother?

We need to move from ‘trust’ & ‘ANC’ to ‘rand’ & ‘offshore now!’

we WILL support SEO’s and MUST protect it agains capitalism to show our votets that we HAVE not learned from our mistakes but just DID the same as always

When your Government is re active as opposed to pro-active you will always have a “we will” followed by “never did’s” The best predictor of future behavior is past behavior.. We as citizens and tax payers have heard it all..Government ,local councils and SOE’s are ineffective and bankrupt..Nothing is or going to change..Ask me..10 years i waited for a Service Agreement to be signed as the one councillor to the next councillor had no clue what the document entailed..And of course i refused to grease palms!! We are in the deepest abyss imaginable..Too little to late Mr Ramaphosa

The difference between this clown and Jacob is at least Jacob delivered on nothing without speaking about it, this chop promises and still delivers nothing. We have a saying in Afrikaans ‘ JA BROER’.

Load All 20 Comments
End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR

Podcasts

NEWSLETTERS WEB APP SHOP PORTFOLIO TOOL TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: