Johannesburg, 23 Aug 2011
The head of the Johannesburg Stock Exchange, Russell Loubser, has praised the leadership and caution of people in charge of SA's macro-finances. He was speaking at the 2011 Gartner Symposium and ITXpo, in Cape Town this morning.
"Fortunately, we don't have many of the crippling problems that many first world countries have. But none of that happened by accident and we need to give credit where credit is due. People like Trevor Manuel and Maria Ramos, Tito Mboweni and Gill Marcus: those stalwarts in National Treasury who managed our macro-finances. All those people were put under a lot of pressure, but stuck to their principles.
“And who put them there and kept them there? Former President [Thabo] Mbeki. Some of the things he did were inexplicable, but he put those people there and allowed them to do their jobs."
He also credited the oversight of SA's banking system.
"During 2008, we were fortunate that our banking system didn't start wobbling. This is because of the oversight and regulation of the banking system supervision department of the SA Reserve Bank. And the JSE didn't make mistakes during the period of 2008 either, when we were as close as a global community to tipping over into full-scale depression."
He painted a positive picture of SA's financial numbers.
"Our macroeconomic numbers and prospects are not that bad. Our public debt is less than 40% of GDP. Our external debt is less than 20% of GDP. Some of the PIIGS - Portugal, Ireland, Italy, Greece and Spain - have external debt more than 100% of GDP and they still haven't worked out that basic thing: when in a hole, stop digging.
“Foreigners are still net buyers of our bonds, they've only just this year been net sellers of our equities. Our foreign reserves have never been healthier - just shy of $40 billion. Our growth rates are reasonable - at least they are positive."
Mediocrity
But Loubser sounded a warning too.
"There's no guarantee that we as a country will get it right going forward. Things don't automatically go right. Whether it's running a household, a company or a country, it requires dedication by smart people just to stay out of trouble. Good leadership is like personal health: it's taken for granted until it's not there and then you really miss it.
“We have many examples of this malaise in SA. I've been on the board of SAA for two years now and for the first time we have a chance of getting things right there. [With] the previous leadership, we had no chance whatsoever. On that line, if the SABC is not going to address [its] leadership issue, and address the relationship between shareholders, board and management, then I'm telling you they will never get the SABC right."
Loubser said there were four things that needed to be fixed.
"We're in much better shape than the PIIGS, the US and the UK. But we shouldn't settle for mediocrity. Things could be so much better here if we get just a few things right. For instance: there's moronic talk on nationalisation that keeps coming up and has to be defended and denied and disputed. Imagine if you could take this out of the system completely and get someone to shut up - so that there's no uncertainty.
“Secondly, we need to get some sanity into people's heads regarding our restrictive labour legislation. Thirdly, you're entitled to strike and entitled to march. But why hasn't somebody come up yet with a simple solution to violence associated with a march? I'll give you the answer. You have a right to strike and to march, but before you get permission, you need a R5 million deposit and if there's one breakage of anything it comes out of that balance. Finally, imagine if we could get rid of the uncertainties regarding mineral rights. We are still a resource-based economy to a large extent and we don't need that uncertainty."
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