When Khumbudzo Ntshavheni speaks about the economy and the private sector, we need to take her seriously — not least because, as minister in the presidency, she controls the State Security Agency as well as communications from the cabinet.
Ntshavheni is also favoured by President Cyril Ramaphosa, who elevated her to her current post despite her dismal performance in almost every position she has held before. As ANC promotions go, it is in sync with the party’s inclination for politics over practised skill.
So, when Ntshavheni spoke last week of how the private sector had “engineered” an assault to sabotage the economy, this wasn’t just a misspoken phrase by a rogue minister. Rather, it has been hard not to see this as an accurate expression of our cabinet’s view on business at a particularly fragile time.
Business Leadership South Africa, which had pitched in to help address the country’s power crisis, its logistics crisis and its runaway crime crisis, was understandably furious at being accused of being part of a conspiracy to destroy the country.
And it will have done our global reputation no good. South Africa is under intense scrutiny internationally by investors, with a crucial election on the horizon and the two pillars of the economy, Eskom and Transnet, buckling. A decade of state-led corruption might have got us here, but how will Ntshavheni’s boss, Ramaphosa, woo foreign investors when this is the climate of conspiracy and hostility into which they’re expected to inject their money?
As it stands, the state has contributed less than a third of all capital spending in South Africa over the past few years
Unintentionally, Ntshavheni has opened the window to the ANC’s deep distrust of the business sector; the rand-rigging saga, in which a handful of traders at certain banks colluded to rip off clients in currency deals, was the lever.
Curiously, she has since doubled down on her view. Speaking to Newzroom Afrika, Ntshavheni recalled how the rand weakened sharply in 2015. “It was said it was because of poor governance and [that] the rand was reacting to mismanagement. [But] the rand was being manipulated by 28 financial institutions including banks and then we blamed it on [the] government, and that is the tendency.”
That is wholly untrue. As the National Treasury and the Reserve Bank have repeatedly said, the weakness in the rand over an extended period was not caused by individual traders fiddling specific currency deals to cheat customers. Rather, it had much to do with the economic stewardship of the country.
Ntshavheni has now hit back again, publishing an opinion column on our BusinessLive website headlined “I Won’t Back Down”. Here, she cynically reframes that criticism of her as an “an attempt to delegitimise the government’s attempts to seek recourse for corporate crime, because the government must apparently be solely preoccupied with resolving the challenges confronting it”.
It’s a classic straw man argument, since precisely nobody has asked the government to back off from white-collar criminals. Most CEOs and businesses would be delighted if there was the slightest sense that the government was, in fact, able and willing to deal with crime, including corporate criminals.
But yes, it would also be nice if the state began properly spending the taxes it raises on dams, roads, schools, health care, quality education and decent policing, not to mention electricity provision, transport and a sturdy logistics network.
As it stands, the state has contributed less than a third of all capital spending in South Africa over the past few years. Which means private firms contributed a staggering 71% of all investment in the country.
So that is what’s at stake when you accuse the private sector of trying to sabotage the country. Perhaps the upside of this debacle is that the next time executives sit across the table from Ramaphosa and his ministers, they won’t quite as easily fall for the silky words of “partnership” we hear whenever a cheque is needed.
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