Ask any number of economists about the state of the SA economy – or any other economy, for that matter – and the question of politics will undoubtedly factor into his or her answer.
This is because both political leadership and its actions are inextricably linked to the perception of political stability that is carried out to the world – and that, in turn, directly influences the confidence with which an investor will, or won’t, bring his business into that environment.
There is an old saying that warns against putting all one’s eggs in one basket, but a smart investor is not likely to put any of his eggs in a broken basket either.
The businesses tasked with sustaining an economy are often among the first victims when political instability takes its toll.
One does not have to search far and wide to read about the effects of US President Donald Trump’s trade war with China or the uncertainty in the wake of the UK’s Brexit negotiations.
These issues affect economies at a global level and yet it is so much more crucial for political leadership to provide a stable environment at local level.
A business in Nelson Mandela Bay might feel the pinch of Brexit if it impacts on its exports in one way or another, but the same business is almost guaranteed to be affected by political instability in its own backyard – where every political move is relevant to the city’s economy.
The past year has certainly brought its share of political instability in our metro.
We have had a change of mayor and the mayoral committee, and the reins of the city manager’s office have been passed through several pairs of hands in the last few months.
In addition, several critical vacancies in the organogram of the metro have remained unfilled for a long period of time, which is worrying.
As the Nelson Mandela Bay Business Chamber, we intend to raise these concerns with the mayor directly and we are encouraged by his swift response to our request for a meeting, as well as his willingness to meet business speedily in this regard.
The Business Chamber is not in the business of politics.
As an organisation we have always been, and will remain, apolitical in our approach.
We welcome relationships with all spheres of government that will lead to greater economic growth – regardless of which political parties fill the seats of power.
That being said, we cannot sit and watch in silence when politics begin to supersede the interests of business.
It remains the responsibility of local government to provide a stable environment conducive to sustainable business growth, through adequate infrastructure, service delivery and investment promotion.
As critical stakeholders in the business of Nelson Mandela Bay, we must always hold each other accountable – on all matters relating to sustainable economic growth in the region.
It takes no more than a quick search of this newspaper’s website to find several ways in which political instability has negatively impacted on business in the metro.
This includes:
● Entrepreneurs struggling to build their businesses because of the red tape and delays inherent in various important processes, such as applying for construction permits and getting an electricity connection.
(These challenges are outlined further in the 2018 Doing Business report for SA, which still ranks Nelson Mandela Bay well below some of its counterparts around the country.);
● Grant money of around R50m being returned to National Treasury in October, after the metro failed to allocate this available funding to projects and failed to appoint a chief financial officer.
The money would have been spent on the city’s bus system and electrification programme.
The metro had been warned earlier in the year by Treasury that the CFO vacancy needed to be filled, but the item – which was on a council agenda in March – was put on the back burner during two council meetings in August and eventually withdrawn in September.
In the meantime, the metro loses water daily through leaks that aren’t repaired, while projects that could supplement the water supply – such as the Nooitgedacht Low Level scheme – are delayed.
Add to that the sudden unreliability of electricity supply from Eskom and business in the Bay is ending the year on a low note.
The perception also remains that massive backlogs in various areas, such as rezoning applications that take months to process, are a result of the changes on the political front.
It is easy to lay the blame for this – and for all other issues in the metro – at the feet of politicians, but the reality is that many of these delays happen at official or administrative level.
We need to fix the systems of directorates where these delays occur, but we must also correct the perception that the fault belongs to the leadership – particularly as investors are guided by their perceptions of the local government.
In the interest of business and promoting investment, the Business Chamber remains committed to collaborating with government through its strategic triple helix model of engagement between academia, government and industry.
Through our metro collaboration task team, we will continue to lobby regarding issues directly impacting local businesses.
Additionally, we have been assisting businesses through various projects, such as an underground water study we commissioned recently, with the hopes of possibly supplementing the metro’s water supply and thereby ensuring a sustainable supply for businesses and residents.
We continue to advocate on the issue of reliable, affordable electricity and will represent the Bay business community at the Nersa hearings in January.
As business, we depend on the government to provide the right conditions for sustainable growth – but it is also our duty to engage with government, support it in fulfilling its mandate and hold it accountable when it fails to do so.