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Manuel: SA needs united business voice

Cape Town - South Africa needs one united business voice, according to former finance minister Trevor Manuel.

At the second annual i3 Summit, hosted by Sanlam Investments and Glacier by Sanlam, Manuel shared his views on the most important investment challenges that SA and Africa currently face.

Manuel pointed out that it’s still the private sector that contributes most to the gross domestic product (GDP), but the employment trend has flipped towards the public sector.

“This provides us with a very real contradiction. Business in SA has no combined voice. Unless there is a coordinated voice that advances everyone’s interests, real issues are not brought to the table," said Manuel.

“With the collapse of unions, an absent business voice and labour and capital not talking to one another, our system is broken. We need an organised voice of business to let Government know which regulations make sense and which don’t.”

Manuel also highlighted the disconnect between job loss announcements in the mining industry and the wage demands by unions.

Since SA is sitting on 95% of the word’s platinum reserves, unearthing new uses for this precious metal could significantly contribute to an economic lift-off in SA, in Manuel's view.

He encouraged fund managers to explore and invest in platinum-related research and development ventures, such as the hydrogen cell.

READ: Manuel: Africa has a lot going for it

Furthermore, 60% of the world’s uncultivated arable land is on the African continent but only 5% of cultivated land is under irrigation. In his view this is an opportunity waiting to be unlocked via infrastructure development - from roads to cold storage systems.

Here too, in his view, fund managers play an important role in economic growth, namely by buying the bonds that institutions like the African Development Bank issue to fund infrastructure development. In this way other opportunities can be unlocked.

Manuel held up Ethiopia as one of the most dynamic economies on the continent.

He said Ethiopia is on the road to sustainable economic development with the well-designed urbanisation of Addis Ababa boasting, among other things, the first light rail system in Africa.

One of the levers to expand economic opportunity mentioned by Manuel is a well-oiled transport system. It’s not only road and rail that’s important, but also what happens at the border posts.

“How we construct regional integration is important for us to go forward. We have the world’s oldest customs union that we share with Botswana, Lesotho, Swaziland and Namibia. But we still have a lot to learn from the movement in East-Africa,” he explained.

According to Ernest & Young, one of the drivers of growth in Africa is a diversified economy.

Here the African continent has made excellent progress, in Manuel's view. Only 5% of foreign direct investment in Africa now goes towards extractive industries.

“Africa is no longer a mining continent. In fact, the world now tries to copy technology and financial developments from Africa, such as M-Pesa,” he pointed out.

ALSO READ: Manuel: Name calling won't solve SA's problems

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