No winners if rot continues

Angloplats' long-awaited restructuring plan, announced last week, left me with a deep sense of despair. As an investment manager, I clearly understood remedial action to restore the miner's operations to profitability was unavoidable. The world's largest platinum producer was haemorrhaging.

The global economic crisis had brought hard times. Jewellery sales in Asia remained steady but a plunge in demand for catalytic converters, primarily from Europe's motor manufacturers, had knocked the platinum price to levels at which only 60% of the group's mines were making money.

But it wasn't only external forces that were draining the organisation's finances. Years of above-inflation wage hikes without equivalent increases in productivity, on top of massive rises in input costs, like energy, had diminished operating margins to a point where the group's long-term future was in the balance.

Holding company Anglo American was also feeling the heat with strident calls by shareholders to unbundle the underperforming subsidiary.

Still, in a country where one in four adults is unemployed, one can't ignore the plight of the 14000 workers who will lose their jobs and face the daunting prospect of finding alternative means to feed, clothe and shelter their dependants. They have reason to be anxious.

And spare a thought for government caught between mine unions venting outrage over the possible sacking of their members and mine bosses acknowledging that no action would result in even greater job sacrifices.

It's easy to argue for each side, but in this debate there are no winners. South Africa's political and economic standing has deteriorated notably over the last few years, the recent violence at Lonmin's Marikana mine and outbursts in the Western Cape farmlands only hastening our slide.

Sir Sydney Kentridge, the prominent barrister, best remembered for defending Nelson Mandela in the Treason Trial in the late 1950s and representing Steven Biko's family at the inquest into his death, highlighted our decline in an article in the Financial Times at the weekend, expressing disappointment with the current ANC government under Jacob Zuma.

Kentridge was concerned that there were still millions of people who were homeless or living in slums and that the government did not have any sense of urgency.

"There's widespread corruption but it (government) does not seem to be able to do anything," he told his interviewer.

Sure we can claim that, instead of sticking to their promises of eliminating poverty and disease through job creation, the country's new elite were more engaged in drafting legislation that attempted to right the wrongs of the past, no matter the cost, and crafting policies that allowed them to amass vast personal fortunes which they squander generously on the trappings of the fabulously wealthy. Regardless, where does that leave us? Our trade deficit is widening, manufacturing receding, mining output shrinking and consumption slowing. The rating agencies are downgrading our credit and the rand, a reliable barometer of investor confidence, is on a weakening tack.

South Africa is blessed with an abundance of natural beauty and economic riches that should make it the envy of the world, yet in a recent Economist Intelligence Unit survey we ranked lowly among the best countries in which to be born in 2013, placed 53 out of 80.

The Economist drew its conclusions on quality of life indicators and objective determinants such as prosperity, health and safety. Obviously our high levels of crime and corruption, low levels of skill and competency and failing education and health standards weighed heavily against us in the appraisal. Our nemesis, Australia, a nation that continues to attract our trained and educated professionals, came in at number 2 after Switzerland, demonstrating that people admire countries where the trains run on time, police enforce the law and homeowners remove the rubble from their pavements.

The good news - genuinely - is that business is eventually finding its voice, questioning the ruling party's dithering, ineptitude and flawed thinking. More encouraging, though, is that voters are finally stirring, realising that our present trajectory could lead us down the same path as our infamous northerly neighbour.

We all have strong views and opinions about what is needed to reverse our perilous course. I don't believe it calls for grand and sweeping programmes that project 30 years into the future - well not yet, anyway. As I have written many times before, preparing long-term projects plans tend to give the authors satisfaction that everything is under control.

We can begin building confidence by addressing the simple things polarising the nation. Let's start by nursing patients in our hospitals, teaching young school- children how to add and subtract, punishing corrupt officials, improving efficiencies in our municipalities and ensuring our drivers adhere to the rules of the road.

This week the world's elite will gather, as they do annually, at the World Economic Forum in Davos, Switzerland. The South African government will no doubt send a strong delegation of ministers and well-connected freeloaders. They will rub shoulders with the rich and influential, reassuring everyone that all's well in the land of Mandela. Personally, though, I'd prefer to see the money spent employing workers in my suburb to repair the potholes that tear my tyres, clear the stench from overflowing drains and remove litter from the nearby parks.