South Africa: Economic Crisis Has Rendered SA Sober – Khoza

By Matthew Le Cordeur

The economic crisis following President Jacob Zuma’s Treasury debacle has finally brought about a convergence of government and business, former Nedbank chairperson Dr Reuel Khoza told Fin24 on Tuesday.

“It’s so edifying to have the two parties talk to each other, no longer in a hesitant fashion,” he said. “The erstwhile suspicion that government had of so called capital, and capital also castigating government for being inefficient, appear to be null.”

Khoza, who was the first black leader to become chairperson of one of South Africa’s big four banks, stepped down in 2015 after nine years in the role.

“We are in a crisis of mammoth proportions,” he told Fin24. “To get downgraded and to climb out of that will be very difficult.

“It looks like that crisis is rendering all of us sober and we mean to actually converge and work together,” he said.

In December, Khoza co-authored a letter to Zuma after the markets and rand plummeted due to his firing of Finance Minister Nhlanhla Nene and appointment of Des van Rooyen.

“The damage this is causing to the credibility of the country may take years or even decades to reverse … we are gravely concerned about the manner in which you are governing us,” he co-wrote, according to BizNews.

A proud Khoza praised the leadership of Old Mutual and Nedbank, which he said made the biggest impact to bring business and government together.

Old Mutual Emerging Markets CEO Ralph Mupita and Nedbank CEO Mike Brown drew up a presentation to show government how to avoid falling off the ratings cliff into “junk status” and have led the convergence of business and government, said Khoza.

Planting the seed for change

Mupita and Brown actually drove that process, he said. “They are the ones who actually built a case for ensuring that we don’t get another downgrade,” he said.

“There is a sense that one planted a seed and the management and executive … just see the world in a different way.

“It does appear that government now sees the need to listen to business. I have always argued that … business and the public sector have got to operate together in perfect tango in order for us to prosper.”

Nedbank’s engagement has resulted in several meetings between the country’s top business leaders and Finance Minister Pravin Gordhan, Zuma and Deputy President Cyril Ramaphosa.

Khoza said that if we can work together “sufficiently and substantially to avert being downgraded to junk, the future is bright”.

“In fact, we can only grow.”

Source: Fin24

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