*
*
*

Welcome

PKF Wealth

Latest News from
PKF Wealth

The legacy of Nelson Mandela

The legacy of Nelson Mandela

25 Jul 2018

A Life Well Lived

This month South Africa celebrated the one hundredth anniversary of the birth of a truly remarkable man.  Notwithstanding the media hype and the grandstanding by the local and international celebrities who obtained the maximum political mileage from the event, the occasion was a sobering reminder of his selfless commitment to the unification of a previously divided nation.

Paradoxically it was not the struggle or the armed conflict that he will best be remembered for, but rather his capacity to forgive the transgressions of others and his role in rebuilding the rainbow nation that is South Africa. Whilst in prison he had much time to reflect on the way forward and his once radical and militant approach was transcended by reason and conciliation. 

Madiba remained committed to his vision of a democratic and free society in which all could live in harmony and equal opportunities. Whilst he was incarcerated, the Government pursued its ill-conceived homelands policy, suffered increasing cultural, sporting and economic isolation and became the pariah of the world stage.  Civil society, organized religion, the media and the business community intensified their criticism.  Our borders were under siege, the townships were on the brink of civil war and the economy was being held to ransom by the emergent trade unions.

Something had to give and following dialogue with the business community and clandestine discussions between the ANC and the government of the day, the stage was set for the unbanning of political organizations, the release of political prisoners and the negotiations which gave rise to our new Constitution, the birth of our new nation and our first democratic elections.

Sadly, there are few if any examples of liberation movements that have successfully managed the transition to responsible government.  Mindful of some of the spectacular failures both in Africa and abroad, most significantly in neighbouring Zimbabwe, Mandela sought broad-based support from South Africans across the racial, cultural and political spectrum. One of the most iconic and enduring images of Mandela is his wearing the Springbok rugby jersey on the occasion of the 2005 World Cup Rugby triumph.

Madiba became an international symbol of human rights and the struggle for freedom of justice.  He did not pursue personal wealth or self interest.  When his first term of office ended, he graciously handed the baton to his successor.  In his recent address, President Obama cynically asked who would have dared to stand for election against him.

After leaving office, Madiba became the elder statesman.  He championed the cause of women and children, the building of schools and the provision of healthcare and clean water.  He was a tireless campaigner in the fight against HIV/AIDS and the eradication of hunger and poverty.  Today he stands with the likes of Martin Luther King and Mahatma Gandhi as a truly great and inspirational leader of our time.

Challenges Facing Our Nation

Over the past decade South Africa has borne the brunt of corruption and state capture, leading to inefficiency, wastage and the plunder of resources.  State institutions have bloated management structures, poor leadership, dysfunctional operations and poor service delivery.

Our President has assembled a competent team to probe corruption in state owned institutions and to restore governance and we are cautiously optimistic that this initiative will bear fruit.

Our society remains deeply divided along racial and class lines. South Africa’s biggest challenge is high unemployment in many young black communities and white dominance of the economy and in particular the agricultural sector. Whilst such disparities of wealth and opportunity persist, politicians will ferment antagonism and unrest with inflammatory rhetoric.

Our manufacturing sector is steadily declining.  What is needed is active collaboration between the state, business and labour.  We need to be perceived as a favourable destination for foreign investment. The land reform debate and Mining Charter need to be finalised so that rhetoric can be replaced by policy certainty and meaningful incentives for infrastructural spending and job creation.  South Africa has the second largest economy in Africa but has seen slower economic growth than most of the continent over the last decade.

The proposed introduction of a National Health Insurance scheme is hugely ambitious and idealistic proposition and has not delivered acceptable or cost-efficient outcomes in the developed world, notwithstanding their higher per capita spend. HIV infection stands at 13% of the population. 

Education is in crisis.  The recent fee protests at universities throughout the country have highlighted the sensitivity of the problem.  Our education system needs a thorough overhaul at all levels.  Far too many people are attending Universities.  The entry requirements are too lenient, failure rates are high and there are too few employment opportunities for those who do graduate.  The greater need is to provide technical training and apprenticeships for artisans whilst revitalizing our construction and manufacturing sectors.

Criminal activity is rampant in South Africa.  Our police are losing the battle against organized criminals.  Armed robberies, cash heists, taxi violence and farm attacks feature prominently in our media and affect all of our people. The solution begins with a culture of respect for our elders, our communities, our institutions and our law enforcement agencies.

The Broader Context

The world is currently in a state of disarray and all countries have their own challenges. We are not alone when it comes to corruption and poor corporate governance. We have been shaken by recent events at Steinhoff and Eskom.  Not so long ago, the world was rocked by scandals at Enron and Word Com. Reckless lending and corporate greed on an unprecedented scale ushered in the sub-prime crisis with major corporations such as Lehman Brothers, Bear Sterns and Barings Bank going to the wall.  And who could possibly forget that highly respected pillar of the USA investment community, Bernie Madoff who was convicted of running the world’s most notorious Ponzi scheme?

Half of the world’s wealth is owned by less than 1% of the global population and the disparity between rich and poor is ever on the increase. Executive remuneration levels in the world’s major corporates are obscene by any objective measure.

African countries are often bullied by their Western counterparts into lifting currency controls and removing protective tariffs, in order to participate in trade arrangements, often to the detriment of their local industries. Foreign investors do plunder these economies and reinvest their profits elsewhere. The provision of foreign aid is often anything but philanthropic but simply a strategy to dump their own, heavily subsidized products to maintain prices at home.

The immigrant crisis is a symptom of the fact that people will inevitably move to where the opportunities are, whether across the Mexican border, from the Pacific Rim into Australia, across our borders from our northern neighbours or from Syria, Afghanistan and Iraq into the Eurozone.  The trend is both unstoppable and irreversible.

Brexit and the election of Donald Trump are a sobering reminder that nationalism is on the rise.  Xenophobia and tribalism are worldwide phenomena. The new reality though is that the engine for economic growth is increased consumption. Stagnant populations need an influx of immigrants to provide the workforce and create new markets for goods and services. The average age in Germany and Japan is approaching 50.  In the USA and England, it is closer to age 40. In South Africa, our average age is 27 and in Uganda it is only 15.

Well known strategist and scenario planner Patrick Dixon quotes a survey of 64,000 people in 65 nations.  He concludes that Africa is the place where people are happiest while those in Western Europe are the least happy.  For instance, in Africa 75% expect things to get better and in Europe only 26%.

He notes that the wealth of emerging nations is growing at 4-5% faster than that of developed nations. Emerging markets have large consumer bases, low costs of operation and vast natural resources.  The engine of the world’s economic growth over the next two decades will be the African continent and investors will follow suit.  The product of increased investment is wealth redistribution, social upliftment and the transformation of entire nations.

South Africa is ideally placed as the gateway to Africa and the new renaissance.  If our people have the necessary goodwill and our leaders have the political resolve, then our future will be assured. The greatest miracle of our age was the peaceful transition from Apartheid, widely attributed to Nelson Mandela and the influence of a generation of prominent black Christian leaders such as Archbishop Desmond Tutu. Whilst Mandela was the symbol of the struggle for a new order, he did not walk alone. There were and always will be many people and organizations in civil society who share the same values and collectively strive to build a better future.

 


Get In Touch

Form

* *
*