HILARY JOFFE: There’s a way to make the illusion of investment a reality
Investment conference evoked plenty of cynicism, not to mention pledge and plan fatigue
“Obviously we know it's PR, so we give them PR back,” said one of those who made a pledge at this week's investment conference. And said a market player who declined to attend, virtually or otherwise: “When it becomes real we will know, and the mood will shift around it.” It was a conference evoking plenty of cynicism, not to mention pledge and plan fatigue. SA has had months of economic recovery promises and plans, and more than one infrastructure investment summit. This one arguably had to go ahead because President Cyril Ramaphosa had undertaken at the first one in 2018 that it would be an annual event — and the optics might not have looked good had he cancelled. But under the circumstances it was always going to risk being seen as more confidence trick than confidence booster.
Not that the investment wouldn’t be great if SA could get it. The times when SA saw high rates of economic growth and job creation — most recently in the boom years before the financial crisis — were times of strong growth in investment, particularly by the private sector. But those times are a fading memory. In the second quarter of this year fixed investment plummeted by 60%, the largest decline on record. But investment spending was in decline even before the Covid crisis, and the conferences sadly seem to have done little to arrest this...