The South African business community and the private sector played an invisible role to turn around the country from a pariah state to a prosperous state, South African High Commissioner Robina Marks said addressing the 180th annual general meeting of the Ceylon Chamber of Commerce.
Marks said that the primary role of businesses is to play an active part in uniting a country, for both their own survival and sustainability, and for the country’s economic development and this is what happened in South Africa.
“Across the world, South Africa was seen as a pariah state because of apartheid that separated races. We were ostracised by the international community,” she said.
International anti-apartheid movement succeeded in applying sanctions against South Africa. “This in turn snowballed into civil society, who refused to buy and consume South African products, as that was seen as tantamount to condoning apartheid.”
The country soon hit an all-time low, as the South African economy was in free-fall.
From the mid-1980s, foreign governments and businesses cut many economic ties with South Africa and in 1985; international banks began refusing to roll over short-term debt.
“Due to this over the next year, the country had to pay one billion US dollars in loans. Inflation rose to 16%, the currency tumbled and the government introduced exchange controls. By 1986, over 100 multinationals had disinvested from South Africa,” the High Commissioner said.
“However, the country was able to turn themselves around, in just 25 years.”
South Africa is now considered to be a leader in the African continent, with a GDP of US$ 385 billion, compared to Sri Lanka, which has a GDP of US$ 90 billion. She attributed this to an invisible role played by their business community and private sector. She revealed that the reason businesses played such a leading role was that they ‘quite frankly, didn’t have a choice.’
“The economy was down, domestic consumption was down, and the international export market was shrinking. In this climate, the private sector had two choices: to help the apartheid government and white society, or to help build a climate of trust in which the political leaders could move the country towards a more stable future. They chose the latter.”
In moving towards a more prosperous and united future, the private sector banded together to push South Africa towards success.
“They funded efforts at maintaining the peace. They knew that it was in their own interest to make concessions around a decent living wage that would quell the many industrial strikes that we had at the time. Many of them improved their working conditions, improved salaries to workers, and offered scope for promotion to their black workforce.”
They basically helped to market the vision of a non-racist South Africa to the international community.
“They were vocal about the fact that the country was on the right track, that good, fair and inclusive governance could also be good for business. More importantly, because they had vested personal and business interests, that they had no intention of leaving. So when prominent companies like Anglo American, a multinational mining company started ‘selling’ the new South Africa, the outside world took notice that there would be no local capital flight,” she said.
“Another point of importance was that the business leaders all stayed back as nothing demonstrates confidence in a country more than staying and not leaving for what might be seen as greener pastures.”
The High Commissioner expressed these views at a panel discussion held on The Role of Business in Sustainable Economic Resurgence, conducted by the Ceylon Chamber of Commerce at their 180th Annual General Meeting held recently. The business of business is not only business, she stressed, and any company that ignores the impact that an uncertain external political environment has on their bottom line is doomed to fail.
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