I just completed a course titled “Managing Global Political Risk,” which focused on the intersection between business and politics and the challenges within. A very interesting class taught by folks who are at the Eurasia Group based in New York City.
“What is your call?” was the question we were always asked in each class. This basically meant, in a minute or less, explain the short term, medium term and long-term risks of your country. I was responsible for South Africa and followed the markets, politics, societal and regional developments over a certain period.
The funny thing about this class is that you had to really think critically about everything you saw and try to extrapolate the future a bit. The question is can we really tell the future, especially for African countries? Countries in our continent change all the time, dynamics are unpredictable and for many people the prediction is always negative or cautious.
I had to write a country brief for South Africa where I had to address various issues concerning South Africa. Much of it had to deal with the World Cup of course, because my ‘call’ was that much of South Africa’s future will depend on how successful it runs the tournament. However, on the flipside, all the investment on the stadiums will only have a short term return…what is their use in the next couple of years? Will the return be consistent and be used for another tournament? Will big clubs like Barcelona or Manchester United train in South Africa to keep investment high or will South Africa follow the path of Greece? Let us not forget Greece hosted the Olympics in 2004 and now they are close to defaulting. I know Greece is not South Africa but neither of these countries are China…
I’ll leave you to make that call.
Below is an excerpt from the conclusion of my paper:
The Way Forward
South Africa has many risks that it will be facing in the next five to ten years. A lot of it will be shaped on how successful it hosts the World Cup. A successful tournament will reassure investors that South Africa is a stable emerging market that has vast potential. It should be understood that South Africa will not turn into a Zimbabwe, but the politicians should be wary of the signs that might tip the scales. The Obama Administration will continue to see South Africa as a partner but will perturbed to hear how Zuma plans to resolve the power-sharing dispute in Zimbabwe.
President Zuma should act quickly and decisively in mitigating the racial tensions that exist in his country if he really wants his country to lead Africa into the 21st century. By claiming 2010 as the most important year for South Africa, he will have to work hard to meet the expectations he set up for himself. Demonstrating stability will be essential for South Africa’s regional and geopolitical interest for the next ten years.
If racial tensions do increase to alarming levels then the white minority, who are also the driving forces of the economy, will fear for their safety and flee South Africa causing a devastating brain drain. We are already seeing this today with various investors and entrepreneurs fleeing to places like Tanzania. This is a concern for the long term and the government as the brain drain is not just limited to the white minority but black majority as well.
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I'm interested to see how entrepreurship is encouraged in South Africa, through organizations such as SAIE: http://www.entrepreneurship.co.za/
ReplyDeleteHow can entrepreneurial activity in the country help to sustain long-term political, economic and social stability and efficiency?
SA as a whole is just an interesting 'ball game'! The history, (old and current) politics, racial tensions, amongst many other things...
ReplyDeleteSo many ppl have asked me a looooot of qns (since I am African), expecting me to give them some sort of an insight about SA. Although I have been following SA stuff closely since I was a teenager, I still feel a bit reluctant sometimes...
Anyway, my two cents:
I am also a bit skeptical about the long-term benefits of WC 2010. Maintaining stadiums is not cheap at all, me thinks. But I would like to think that the Govt. have taken that into consideration. Luckily, they have a number of big sports (football, rugby plus cricket); that might turn things around into their favour. But - again - they do struggle to fill football stadiums in the local league?
Lastly, I would like to mention another thing that could be the source of the tensions (and many other problems): The chasm between the rich ones and the have-nots who are the majority. When you hear some stories from the townships you just end up shaking your head. Sometimes I wonder, are these guys going to benefit at all from the WC? Is the Govt. thinking about them?
I do pray nothing bad happens during the WC* as this would surely boost their whole image and promote tourism in a long run. I want to see SA doing well!
*You can throw in English hooligans in there, too!
We all look at SA as the "gem" of Africa, given its history and where it's reached today. I feel that many white South Africans are so attached to the country that they will try and make it through despite the racial tensions. These tensions have always been there, and I am sure they were worse in the past and many of them continued to invest in their country. What will be interesting to see is how the government reacts to the onset of increased brain drain.... what measures will they put in place to entice the white minority to stay behind? One interesting aspect to consider is that, if SA businesses continue to flourish elsewhere (like in TZ), will this be the main factor that entices them to move, as opposed to the racial tensions?
ReplyDeleteWhatever policies or initiatives(if any) that the government may put in place to discourage brain drain, let's hope they're useful and beneficial so that the rest of Africa can implement similar strategies.
Ooh Afrika Kusini, nchi iliyotawaliwa na moshi wa chuki unaofuka kichini chini. Mimi nadhani kombe la dua litajenga Afrika Kusini au itazidi kubomoa taswira ya Afrika kama mambo yakienda kombo. Juzi niliona kuna mat-shirts yametolewa na yamechapishwa "Please Dont Kill Me, I am A Tourist Not A Boer", nikasema mhhh!!...
ReplyDeleteMimi binafsi naomba tu kombe la dunia lipite salama, baada ya hapo watajijua wenyewe. Afrika Kusini baada ya ile vita dhidi ya Waafrika kutoka nchi nyingine, nikaisha hamu nao. Nakubali umasikini umekidhiri, na kwenye hali ngumu utaona mengi ya ajabu na kusikitisha.
Mimi ni hiki kinachinichekesha, Waafrika weusi masikini, alafu hao hao ndio wameanza kuwa na jeuri baada ya Zuma kushinda, wakati Wazungu wachache ndio walioshikilia uchumi, na hao ndio wabaguzi, yaani hiyo jamii yao siielewi.
Kuhusu swala la wawekezaji wao kuzidi hamia nchi nyingine sio wazo baya, lakini, narudia, lakini lazima tuwe waangalifu ni yupi tunamruhusu na yupi, kwani hatutaki unyonyaji wa kibaguzi Tanzania. Nimejishtukia, nimesema tuwe waangalifu kuangalia nani tunamkubali kuja kuwekeza, hahah..nimesahau kuwa Tanzania kila mwekezaji mwenye uwezo wa kuhonga RUKSA, Barrivk Gold haooo wanapeta.
Sasa basi, chekeni na wawekezaji wa Afrika Kusini alafu muone jinsi ardhi itakavyoyeyuka, lakini subiri, Tanzania ni nchi ya wakulima bado, labda tuwakubalie tu manake nadhani wao wanaweza kuwa wanadhamini kilimo zaidi kushinda viongozi wetu.
To all South Africans reading this, if you guys are going to decide to fight because of the recent racial tensions, then please hold your breaths until the world cup is over, after that you guys can turn the swords to each other..this message is brought to by, Your NOT so happy fellow African because of the Xenophobia attacks from few years, coz we may forgive but we will not forget, if you want to know why it broke most of us, come to Tanzania and I will take you to Mazimbo, Morogoro...thank you..
Napenda kurejea kwenye swali au kichwa cha habari (maana inaonekana kila mara Afrika Kusini inapotajwa hisia huchukua mkondo wake).
ReplyDeleteJe, tunaweza kutabiri yatakayotokea Afrika Kusini au kwenye nchi nyingine za Afrika kwa ujumla? Nadhani kwa Afrika Kusini ni vigumu sana kusema kutokana na "volatile nature" ya mambo yao mengi. Wachangiaji hapo juu mmeongelea vya kutosha. Nadhani mfano mzuri kwenye mambo ya uchumi uliogangamala na wenye mifumo imara ni nchi ya BOTSWANA. Wanahitaji pongezi kusema ukweli na itakuwa sio jambo baya kujifunza kutoka kwao.
La muhimu sana ni kuwa na viongozi au kiongozi mwenye "vision"! Lakini hilo ndilo tatizo kubwa la nchi nyingi:
http://vijanafm.blogspot.com/2010/04/hatuna-kiongozi.html
Bahati, kuhusu yale mashambulizi ya wahamiaji Afrika Kusini, unakumbuka ile hotuba ya Mwalimu Nyerere? "Kubaguana ni kama kula nyama ya mtu; ukishaanza huachi milele!" Alikuwa anaongelea mambo ya Muungano lakini ukifikiria kwa kina, yanayotokea huko bondeni Mwalimu alishayaona kwa jicho lake la tatu!
Hii inanikumbusha movie ya 'Invictus'. South Africa is not yet fully independent. Lazima South Africa wawe na kitu kama Azimio la Arusha. Yaani Tanzania tuna bahati sana tulikuwa na Nyerere.
ReplyDeleteManake hao makaburu they've failed to integrate in the society. Lugha zao tofauti kama afrikaans. The average south africans will never see them as one of their own.
Sisi Tanzania kuongea kiswahili kulisaidia sana.
Sorry to sound so pessimistic, but i'm sure they least that could happen is the tourists will be robbed, or maybe kidnappped. The worse is some killings. The crime rates are shockingly high. Something is bound to happen. I just hope for the best.