A watershed year for future of Bay business

KevinHustler
Business Conversation with Kevin Hustler

THERE is no truth. There is only perception. And, if French writer Gustave Flaubert was correct in his assertion, then the South African business landscape offers very rough terrain indeed.

The South African Chamber of Commerce and Industry has released its outlook for the year ahead. To business owners who made it through last year bruised but still standing, this year’s predicted challenges are going to sound awfully and frustratingly familiar.

These include the rising cost of doing business amid failing support and infrastructure; difficulty in complying with regulations and trouble gaining access to finance; labour unrest, instability in the workforce, a lack of public accountability and crime.

There is pressure from the rising rand-dollar exchange rate, and rising input costs. Business leaders and investors are rattled by this list of threats to the continued sustainability of business in this country, and rightly so.

But this perception is not the whole picture. I encountered recently the allegorical story of the blind men and the elephant. The story, which originated on the Indian subcontinent, was popularised in a 19th century retelling by poet John Godfrey Saxe.

It contains an illuminating lesson. In the story, a group of blind men are asked to determine, from touch, what an elephant looks like.

One man, stationed at the elephant’s flank, decides that an elephant is like a wall.

The next, who feels only the elephant’s tusk, declares it to be like a spear. The third man, grasping the animal’s trunk, proclaims the elephant to be most like a snake.

A fourth, stationed at the leg, insists that the elephant is definitely like a tree.

And so on it goes – each man describing his subjective experience of the same animal, and each coming to a very different conclusion.

A continued focus on the negative aspects of doing business in South Africa paints only half a picture. A mature outlook demands an honest assessment that acknowledges successes, and incorporates opportunities as a means of overcoming the challenges we face.

This is a watershed year, and we will celebrate two important milestones. First, we celebrate the country’s 20 years of freedom and democracy. It is against this backdrop that the Nelson Mandela Bay Business Chamber will celebrate 150 years of our organised business movement in the city.

In many ways, 2013 laid down the gauntlet – how will we meet the challenges of job creation and poverty alleviation? How do we ensure the continued competitiveness and sustainability of business? Crucially, are we up to this mammoth task? Will we take every action necessary to make sure that we are ready to tackle these challenges and seize the opportunities that present themselves?

Business in South Africa suffers under negative perceptions. The IMF projected last year that 12 of the 20 fastest-growing national economies over the next five years will be in Africa.

The SA Chamber of Commerce and Industry reports that while firms do not expect significant improvements in the business environment this year, business owners are generally more optimistic.

What can organised business and company owners do to ensure that this optimism is justified?

Firstly, we can continue firmly on the path of advocacy and active citizenry demonstrated last year through the work of the Nelson Mandela Bay civil society coalition.

This city needs engaged businesses and citizens who recognise the need for cooperation between business, civil society and the metro to ensure accountability and good governance.

We must heed the call and take advantage of the opportunities presented to us. Activity in the region points to positive signs, and recent economic gains have been impressive.

A number of significant projects are planned for, are under construction or are already operational. Investments at Coega are a proud example, and include investments such as those by Afrox, Air Products, Coega Dairy, DCD Engineering, FAW and Agni Steels. The development of the Bay West Mall is another.

Research conducted for the business chamber points to the construction industry as a bright growth point, with the proposed Project Mthombo mega-project promising far-reaching effects that will change the industrial face of the province for the better, as it diversifies the economy.

Rail links in the Eastern Cape will be upgraded to support manganese exports and other rail freight. The new tank farms and ferro-manganese smelter at Coega will be operational, and we’ll see the Port of Ngqura further connected by road, rail and sea.

The Port of Port Elizabeth is being positioned as a leading automotive hub for sub-Saharan Africa, and we are going to see R26-billion invested over the next seven years.

There are windows of opportunity in the maritime sector, which open doors in logistics, supply chain management and other related service industries.

The energy economy offers us a supreme catalyst for economic growth, as energy has been identified as a key resource, and the energy sector offers us the possibility of enormous growth.

In short, this year could prove to be a year of big decisions for companies in the Bay and the province as a whole.

The choices we make this year – the opportunities we take, the chances that pass us by, and the perceptions that we create – will have a significant impact on the future economic growth and development of our region. Business holds the economic power, the resources, the skills and the people to make a difference.

Kevin Hustler is CEO of the Nelson Mandela Bay Business Chamber

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