Buy local and boost SA economy- Leslie Sedibe

“South Africa faces a number of challenges and to be profitable in the current market requires a change in mindset,” says Leslie Sedibe, CEO of Proudly South African.

Most of us are pulling in our belts, focused on surviving an economic slowdown. But even given the significant challenges that the country faces, a change in mindset means a thriving economy is possible, says Sedibe.

One of those changes has to do with education. “I don’t believe we can build a successful country with a 30% pass rate. The issue of skills is going to be very important going forward if we are to be productive. Let’s fix this,” he urges.

Among the many challenges facing the country is competitiveness, particularly around South African products, which are competing with highly incentivised products from other countries.

Much of the change that Sedibe advocates has to do is with home grown products. “We need to create jobs, and one of those ways is to buy South African products and goods. When you talk about buying local, there is often an instinctive reaction that you are being protectionist,” Sedibe tells finweek. “But we have to protect our own industries, nurturing infant industries until they establish a base,” something he says the US has done successfully by protecting its tariffs and infant industries.

Local support and localisation can boost an economy says Sedibe. Take Korea’s giant brands like Samsung and Hyundai. Not only big in their own country, they are also global giants and healthy providers of jobs. According to Brand Finance, the two brands have a combined brand value of over $100m and employ over 150 000 people.

Alas, SA brands do not enjoy any real global status to boost the country’s coffers unless one counts multinational brand MTN. The telecommunications company provides employment for 27 000, and with a brand value of $4.7m is Africa’s most valuable brand reports Brand Finance.

Many countries that survived the 2008/9 economic crisis did so on the back of strong industries at home. “It does not help the South African case to continue the trend of deindustrialisation. We need to reindustrialise the economy and build and encourage trade within Africa,” Sedibe says.

Detroit, which last year emerged from bankruptcy - in large part due to policy implementation on manufacturing revival - is a working example of how to revive an economy and provide jobs.

SA’s stimulus package might be based on the principle that sourcing should come from within the country to build the economy, but too often there is much pontification on policy with little follow through on implementation.

“We have great laws and policies. They are just not implemented,” says Sedibe. “Cape Town is an excellent model of what can be achieved. What we need to do is ask the people of Cape Town how they got it right.”

“We have a trade deficit, an implementation deficit and a trust deficit and these are the things we need to address. It’s also about strengthening your messages for foreign direct investment. These are key to growth and development of the economy.”