All Hat and No Cattle: A Diplomatic Spat

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A couple of weeks ago, a minor spat captured the headlines, as minor spats are wont to do. At the centre of it was an ‘informal’ discussion paper sent in June last by a group of Western embassies outlining barriers to investment, apparently written as a contribution to South Africa’s efforts to attract investment.

Splashed on the cover of the Sunday Times (after having been unnoticed and probably forgotten for seven months), it triggered a blast of wind and odour. From South Africa’s often lethargic Department of International Relations and Cooperation came a demarche. The ruling African National Congress (ANC) and its Communist Party (SACP) associates reverted to Cold War factory settings: the imperialists were at it again.

The SACP frothed about firms based in these countries having acted badly in South Africa, true as far as it goes, though from its perspective good behaviour from any capitalist entity would be well-nigh unthinkable. (Better perhaps to comport oneself as one of our own state-owned entities? Just don’t trust diplomatic communiques, or anything else, to our post office.)

ANC spokesman Zizi Kodwa upped the ante. ‘We see this as nothing else but as part of an agenda for regime change.’

It probably comes as a surprise to the diplomats involved. Sure, in retrospect they might have been more fastidious about their choice of channels of communication, but who would have imagined that a few thoughts on the investment environment might have the influence sufficient to drive the ANC from office?

Especially since – from what has been reported about this document – they expressed as good as nothing that was not part of the general public conversation.

The spluttering outrage seems rather like the triumph of form over substance. Or, as they say in Texas, all hat and no cattle.

According to a write-up in the Daily Maverick, the paper pointed to the need to reinvigorate the rule of law, establish regulatory certainty, reform the visa regime, and protect investments. In fact, it’s hard to identify anything here that someone in government has not acknowledged as an issue to be explained, if not always dealt with. Perhaps these are messages that the government and the ruling alliance don’t care to hear, but they’re hardly an incitement to revolution.

Indeed, the ANC expressed indignation that its efforts were supposedly not granted due recognition: ‘South Africa has not been afraid to tackle major challenges facing the country, including corruption and state capture. These matters are not restricted to South Africa, but all countries face similar challenges. South Africa has been a leading light on the global stage in tackling these matters without fear or favour.’

Well… the uncharitable might point out, by way of example, the ‘state capture’ malaise was presided over by the ANC, and it welcomed the Zuma era by abolishing South Africa’s premier corruption-busting agency in the form of the Scorpions.

Hat in evidence, cattle not so much.

Or that the shifting regulatory regime has done great damage to investment and business prospects, not least in mining, the country’s signature industry. South Africa has been incessantly ‘working towards’ policy certainty – for many years.

A broken immigration system keeps skills out, and throws up barriers to tourism.

And on security of investments, South Africa spent 2018 loudly announcing that it was steaming towards a regime of Expropriation without Compensation. ‘We are going to take land and when we take land we are going to take it without compensation,’ said President Ramaphosa.

In a recent piece in the Financial Mail, prominent economist Azar Jammine argued convincingly that our poor economic performance last year came down significantly to the impact of this policy drive. It probably cost South Africa a Ramaphoria windfall.

It requires no diplomat – or anyone else for that matter – to discern that policy promises of this nature would be badly received by the business community, and mean foregone opportunities. They remain so.

Meanwhile, in the intervening weeks, we’ve seen a State of the Nation Address that delivered more of the same, and an electricity crisis that left the President ‘shocked’ that Eskom had ‘reached this stage of dysfunctionality’, a conclusion that would long ago have dawned on anyone reading a daily newspaper, or checking in on any half decent news-site.

Perhaps the energies of our ruling elites might more productively be deployed in dealing with these pathologies as they exist and as they continue to sap our collective future. Whatever hostility may be felt towards the countries that put together the paper, the issues it raised are real and pressing. That is, of course, if the real-world future – rather than burnt-out ideology – is the priority. It is not clear that this is the case.

Or perhaps it is a case of all hat and no cattle. Gaudy posturing not matched by a determination to make the hard choices needed to progress.

And one day, we might well find that the cattle are gone.

Terence Corrigan is a project manager at the Institute of Race Relations. Readers are invited to take a stand with the IRR by sending an SMS to 32823 (SMSes cost R1, Ts and Cs apply).

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