BLSA CEO Busi Mavuso
Photo by: Creamer Media's Donna Slater
As the Economic Freedom Fighters (EFF) and its supporters protested in various ways across the country on Monday, as part of a so-called “national shutdown” of the economy, Business Leadership South Africa (BLSA) CEO Busi Mavuso has called the protests counterproductive.
She echoes sentiments shared by trade union UASA and the South African Chamber of Commerce and Industry in days prior.
Mavuso says in her latest weekly newsletter that threats to businesses, many of which are struggling to overcome the challenges they already face from a weak economy and energy insecurity, add to the already negative business sentiment.
A national shutdown only fuels investors’ fears for putting their capital at risk to help build South Africa’s economy. It also makes employees, customers and suppliers stay away from businesses, costing them revenue, Mavuso explains, adding that disruptions do not solve any of the country’s problems.
Mavuso deems the national shutdown a political tactic that clashes with South Africa’s democratic dispensation in which people can exercise their vote to affect change in governance. “We do not need violence and lawbreaking,” she highlights.
News agencies have reported instances of attempted arson and attempted petrol bombs thrown in Cape Town, as well as instances of stone throwing and blocked roads across the country. However, by midday, the protest has not developed into the mass action that the party had punted, even though its leaders had described the shutdown as a success.
Mavuso welcomes the moves by authorities to ensure there is appropriate policing across the country to deal decisively with illegal activities, including the barricading of roads.
BLSA itself also supports the police by relaying crime-fighting information through its Business Against Crime and Eyes and Ears initiatives.
Mavuso takes solace in the fact that businesses and labour are better prepared to manage remote work, owing to these measures having been implemented during the Covid-19 pandemic, and therefore the economic impact of the national shutdown will be lessened.
“Our focus should be on building businesses rather than shutting them down. We should be working to reform the way our economy works, not trying to stop it from working.
“Taking responsibility to try and make things work involves being accountable, the kind of accountability that clashes with the populist instincts of some,” Mavuso states, adding that BLSA will continue its efforts to help deliver the changes needed in the economy.
Meanwhile, Mavuso says the decision by ratings agency Standard & Poor’s (S&P) to downgrade South Africa’s outlook is another reminder of how much the economy is being held back by the failure to timeously implement the structural reforms needed.
The agency wants to see decisive improvement in infrastructure, the governance of State-owned enterprises and a reduction in public debt. However, Mavuso expects S&P to further demote the outlook to negative later this year if no improvements are made.
“It will take all economic roleplayers to turn around South Africa’s fortunes and business has the agency to help government make the profound structural changes needed to regain our positive rating outlook.”