Mandela’s legacy continues in South Africa’s economy

Business across the board on Friday hailed Nelson Mandela's contribution to creating a positive investment environment and reintroducing South Africa and its local firms back onto the world stage post-1994.

The esteem with which he is held is evident in the unprecedented decision by the Johannesburg Stock Exchange to close all its markets for five minutes at 11am on Friday.

As early as 1996, Mandela told Parliament that a shared vision between business and government was key to creating the socioeconomic development the country needed. 

Business Unity South Africa on Friday offered its condolence to the Mandela family, and said Mandela had ensured that business played a role, not only in economic growth, but in development and transformation. 

Chief executive Nomaxiabiso Majokweni said; "Its difficult to find the words to describe Nelson Mandela's huge contribution to the stability and progress in South Africa's early years of democracy after 1994."

"In the formative years of our democracy, Madiba's steadfast focus on nation-building and the development of pragmatic economic policy were critical in building investor confidence."

"Very early into South Africa’s democracy, investors were able to put political stability as the least of their worries on the list of factors of important considerations for investment," she said.

Mandela passed away at his Houghton home in Johannesburg on December 5.

At the time Mandela came to power, South Africa had become increasingly isolated because of international opposition to apartheid.

Majokweni said Mandela also encouraged business to embrace the Nguni world ubuntu or "humaneness" and to see the sector as part of a team effort to overhaul the country.

The Banking Association of South Africa (Basa) announced that all the country’s banks would close on the day of Mandela's funeral in recognition of his contribution.

Cas Coovadia, head of Basa said; " South Africa lost a father and the rest of the world an icon that worked tirelessly to make this a better world.

"It is rarely given to a people that they should produce a single person who epitomises their hopes and expresses their common resolve as Nelson Mandela did," he said in a statement.

Anglo American's chief executive and Chamber of Mines president Mark Cutifani said of Mandela that he was "integral to ushering democracy into South Africa, and led the country with distinction, stature and humility during his presidency".

Kimberley Process
One of Mandela's achievements hailed by the Chamber of Mines was his evolvement in the Kimberley Process, which was set up to eradicate conflict diamonds from the market.

A number of business leaders have over the years hailed Mandela's "accessibility" driven by the value he placed on reconciliation.

The markets showed no reaction to Mandela's passing, no doubt the result of his having been out of politics for some time and his long illness, with some analysts expressing the view that his death had been factored it the market a while ago.

Analyst Nomura Peter Attard Montalto, who admitted that his sector was not prone to writing obituaries or great sentiment, said in a statement that the mark left by Mandela, which had been "woven into the fabric of the country" had been substantial.

He said Mandela "gave his life to a simple, yet at the time distant dream, something that required great sacrifice on a personal front".

Liberal economy
He went on to say that while there is much that can be criticised about South Africa, such as the increase in inequality and unemployment, it was at Mandela's urging and those of some of his colleagues that "South Africa moved away … from [earlier policy such as] nationalisation of industry and towards a more pragmatic social-democratic liberal form of economic policy as opposed to more hard line socialism".

He said he believed the legacy left by Mandela was strong enough to withstand the present threats to the country, with the ANC "broad church still firmly anchored in the rational policy space".

The rand traded in neutral territory, at around R10.47 to the US dollar, following 11 days of losses caused by fears that the US Federal Reserve could start to cut back on its massive bond-buying programme in mid-December, and news that South Africa’s trade deficit had widened more than predicted.

The Reserve Bank said in its December quarterly bulletin on Tuesday that the deficit had expanded to 6.8% of GDP from a revised 5.9% in the second quarter, the largest deficit seen since 2008.

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Lynley Donnelly
Lynley Donnelly
Lynley is a senior business reporter at the Mail & Guardian. But she has covered everything from social justice to general news to parliament - with the occasional segue into fashion and arts. She keeps coming to work because she loves stories, especially the kind that help people make sense of their world.

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