MANDY WIENER: A good GNU story to sell
For now, the political stability South Africa has been enjoying seems to be holding, and foreign investors are taking notice.
Tech billionaire Elon Musk (left) and President Cyril Ramaphosa at the United Nations General Assembly in New York, in the USA. Picture: GCIS
President Cyril Ramaphosa has spent the past week in the US of A, selling South Africa and the ‘second miracle’ of the country, as he’s been describing the Government of National Unity abroad.
He’s rung the bell at the New York Stock Exchange, met with South African-born-and-raised billionaire Elon Musk and addressed investment summits, all on the fringes of the UNGA79.
The big marketing tool has been the Government of National Unity, which seems to work in the international market.
The President’s spokesperson Vincent Magwenya told me on The Midday Report this week that investors have been extremely receptive.
“As you know, we are really turning the corner on the energy front. We are on our way to resolve some of the logistical hurdles that we’ve faced that have undermined particularly the commodity-based industries so there is a great deal of enthusiasm towards South Africa.
“Let me put it this way, South Africa has once again recaptured the imagination of the world in the manner in which we have managed what could have been a potentially difficult political transition where you had no outright majority party. The world is in awe with what we have managed to do in a very short space of time. As you know some countries in Europe do take quite a time to form coalition government, in our case there is a positive reception that we were able to do this in a peaceful climate and we did it quickly and there’s a sense of stability and sense of optimism towards South Africa that one is sensing when interactive with investors here,” said Magwenya.
Ramaphosa also addressed a roundtable of the Business Council for International Understanding and described the formation of the GNU as ‘the second miracle that we have put together’, a reference to the first GNU established at the advent of democracy.
While the GNU has hit speedbumps at home with the main disagreement over the signing of the BELA Bill by the President, he is certainly putting on a polished front abroad.
The ANC and GNU cabinet ministers have also been at pains to punt the progress of the GNU government. Sports, Arts and Culture Minister Gayton Mackenzie regularly posts about the ‘GNU in action’ on social media. ANC Veterans League leader Snuki Zikalala even managed to squeeze a reference to the GNU into an interview about the repatriation of freedom fighters to the country.
This just demonstrates the extent to which supporters of the brokered deal are desperate for it to hold together and have an impact, primarily on growing the economy. They will be aware of detractors both within the ANC as well as from political parties not included in the government, specifically the EFF and MK.
While many commentators still argue that the ANC could walk away from the GNU and form a minority government or even a coalition with the so-called progressive parties, they continue to be dismissive of ‘the markets’ and how the positive sentiment has driven a reaction.
Bloomberg reported this week that the GNU has ‘triggered a wave of investment in SA’.
“The formation of South Africa’s business-friendly coalition government has triggered a wave of investment announcements and positive sentiment not seen in years, spurring hope that Africa’s biggest economy may finally be finding its footing after a lost decade-and-a-half,” it reported.
Rising optimism has been illustrated by markets reacting positively, the rand rallying, government bonds offering strong returns and interest rates dropping for the first time in years.
It specifically pointed to key investments such as those by ArcelorMittal reopening steel plants, Qatar Airways buying a stake in Airlink and Anglo American’s iron-ore investment.
Now it can add the enthusiasm of Pretoria-born Musk to the list and hopefully, the imminent arrival of Starlink here, once regulator hoops are cleared.
After meeting with the President to discuss the NHI last week, Business Unity South Africa also emerged saying it was encouraged by his openness and willingness to listen.
One hundred days into the new administration, those leading this collaborative government are eager to convince us and the world that the GNU is working. On the surface, it certainly appears to be holding.
The images of Ministers Gayton Mackenzie, Dean Macpherson and Deputy President Paul Mashatile all dressed up for Heritage Day celebrations in Ficksburg and smiling and dancing together was excellent marketing.
The President has also had a great story to sell.
We would be naïve to think that it is all going swimmingly in reality. But for now, it does seem to be holding despite the inevitable and expected teething problems.