While this year's Rugby World Cup will provide a platform to forge closer relations and business ties with France, South Africa can do more to maximise that opportunity.
Chair of the French South African Chamber of Commerce and Industry Dr Yves Guenon sounded stark warnings of how government inaction would directly affect the country's potential to grow.
Guenon cautioned if matters relating to energy generation, education, corporate tax and a reciprocal visa agreement are not addressed, South Africa will continue to underachieve.
The country's inability to tackle its energy crisis is of particular concern for Guenon, a doctor in physics.
“You must remember, the money we are spending on generators and diesel is not money spent on investment. In that way we are not creating jobs here. It is a real consequence.
“In the long term it could have an effect, as the investment here will not come as before. We need to be sure when we are investing billions upon billions that we will be able to produce in South Africa.”
You must remember, the money we are spending on generators and diesel is not money spent on investment. In that way we are not creating jobs here.
— French South African Chamber of Commerce head Dr Yves Guenon
Not that the French are packing their Louis Vuitton bags just yet.
“The question of energy is a difficult one for all businesses in South Africa, not just the French companies,” reminded Sébastien de Place, president of the CCE [Foreign Trade Advisers of France] and partner at financial services company Mazars. “I don't think French companies are reconsidering investing in South Africa for that particular reason. Like South African companies we have to find solutions.”
Guenon, however, believes the time to take decisive action has already arrived. “I understand perfectly well you cannot solve the problem in one week or one, or six months. We all know it will take two, three years to solve the problem. But the decision has to be taken now.
“I am very sad because South Africa is the only country in Africa having no problem of energy, in principle. There is huge infrastructure, but it is working at 50% instead of 80%, 90%.
“If the infrastructure was used at 70% there would be absolutely no load-shedding in South Africa,” he advised.
While recognising South Africa's reliance on coal is deep-rooted, Guenon cautioned a failure to embrace a greener future will bring stronger headwinds to the already ailing economy.
“If you invest in South Africa to sell your product in Europe you will not be able to do it in the future because of the tax you have to pay as the electricity production here is too carbonised.”
He stressed, however, the most immediate challenge isn't whether this country's energy production meets CO2 standards. “The problem is your ability to generate power 100% of the time. We cannot continue to work without knowledge of what will happen in the next year, two or three years.”
Guenon recognises each country must have the autonomy to decide which way it wants to generate its energy. “The past you have in South Africa is not the past we have in Europe. What we try to do is to say find your best solutions for what you are producing in your country.”
He acknowledged South Africa cannot wean itself off coal any time soon. “If you did you would have no electricity. We have noticed that we have no more load-shedding during the day, but we have it from 4pm to 6am. Why do you think that is so? Because the industries start to work at 4pm in South Africa? It's a joke. Industries start at 6am, not in the afternoon.
“The reason we have load-shedding at 4pm is not because the people are back home but because the sun is going down. When that happens there is no more electricity coming from the solar panels. Because you don't store the energy generated that way, there is no energy. No-one is telling you this, but that is the reality.
“This needs to be explained to people. People are attacking South Africa too much. It is the country with the best infrastructure and a network in Africa. Other countries in Africa are burning diesel, for many years. This is an industrialised country, and the idea is not to destroy that. Without decarbonised energy in future it will be difficult for South Africa to sell their products.”
Though France invested R70bn over the past three to four years in South Africa it is seeking to drive that number up, but it urged the government to ease corporate tax. “President Ramaphosa said they intend 'easing it for business'. We are not 100% sure that will become a reality.
“I think that is something people are not understanding here. The more you increase taxes the less jobs you have. I know the unions will disagree with that. They are wrong.”
The difficulty the South African youth have in finding a job is because the training and education they receive is not adapted to what industry requires.
— French South African Chamber of Commerce head Dr Yves Guenon
France has 500 companies employing 70,000 people in South Africa. Increasingly, however, they see a disconnect between what they require and what the country's education system produces.
“The difficulty the South African youth have in finding a job is because the training and education they receive is not adapted to what industry requires. We have seen the gap. Some of your programmes are still from 1996.
“You have to adapt your education to the needs of industry. When I see the critical skills in this country is defined by the minister of education and not the ministry of industry I say 'no!' The critical skills have to be defined by industry. There is not enough of a relationship between industry and education and training.”
He said it is absolutely key the government wakes up to that reality but conceded better training would cost more. “Technical training costs money. Much more than training a theoretical person. To train people in business you need one teacher, one professor and a computer. To train a technician in electronics you need to have equipment. And not equipment from the last century, but now. If not they'll never find a job.
“We are not here to educate because government has to do that, but we can train. We have to work together.”
Despite the disagreements, the spirit remains cordial.
Guenon sees the major sporting events in France over the next two years as an opportunity to bond.
“Don't think of the RWC as a single event. This is a good opportunity to watch the rugby, but next year there is another opportunity to come to the Olympic Games in Paris. In the next two years we have the opportunity to link business and sport. This never happened in the past. It is a chance to not to speak about politics and business first, but to speak about sport.
“The best will win, whether it is South Africa or France.”
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