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Business leaders must stand up as SA enters bumpy year - CEO

Feb 02 2017 20:01
Carin Smith

Cape Town - Business leaders should stand up for what is wrong and work collectively despite the threats, Adrian Gore, founder and CEO of the Discovery Group, said on Thursday.

He used as an example how the business sector collectively had a good dialogue and made government listen after Nenegate about a year ago.

"Who knows, we could be facing the same thing tomorrow or next week," said Gore, who was part of a group of business leaders called together by Finance Minister Pravin Gordhan after Nenegate to brainstorm on how SA's situation could be improved.

"We must solve our problems by standing up. Don’t just say things will work out. We have a collective responsibility to build the country," Gore said at a business breakfast hosted by Accelerate Cape Town and Deloitte.

"I think the cohesive process of business having acted as one was positive after Nenegate. The nature of business is often defined by the nature of a government. The morality of a government often defines the character of business. Business must operate in a way that is responsible and supportive of government," said Gore.

"We should stand up for what is wrong, but in a constructive way. We can work collectively despite the threats I think might be coming up. This will be a noisy, bumpy year I think, but no matter what the issues are, we can rebuild. There is amazing goodwill in SA to be harnessed. We as business leaders can help focus on what is common among us instead of creating divisions."

READ: Business leaders rally behind Gordhan as SA can't afford distractions

He said whether one likes the rating agencies or not, they have power.

"We as business tried our best to explain to the man in street what the effect of a ratings downgrade would be: increased cost of debt, difficulties - especially for the poor - and joblessness. Collectively we must make sure and understand ratings agencies are for growth. Their approach is rigorous and straightforward," said Gore.

"I travel the world and often have to defend South Africa, since the future of the country has always been in question. For decades people have been asking whether SA will fail. We all live by that concern," said Gore.

"That is an unfair label, but I believe it affects our long-term decisions and investments and how we as business people are building the country."

READ: Named: The 81 CEOs who pledged support for Gordhan

He said compared to 20 years ago SA is still just a "tiny country" in the world context. In real terms SA's gross domestic product is, however, 70% bigger than 20 years ago.

"Yes we all had challenges, but systemically the country is better than before," said Gore.

"We did research and SA's GDP growth rate is incredibly stable. The truth is we have never done particularly badly – even through the difficult post-apartheid era and even during the terrible commodities slump. At the same time, we don’t really shoot the lights out either."

In his view 2017 will be a rocky year in terms of politics, but he is confident that the country has the ability to pull through.

When SA became part of the Brics group along with Brazil, Russia, India and China, people asked how SA could consider itself in the league of such countries.

Today, however, Gore said one could describe Brazil as a failed state and Russia as a rogue state, while SA continues to be stable although it underperforms.

"So my interpretation is that yes, there are real problems, but they are not greater than other countries'. Our problems are inequality and joblessness, but all countries have problems," said Gore.

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