SOUTH Africa’s economy might be experiencing a recession and unenviable downgrades in recent months, but all hope of recovery is not lost.
This has been the predominant sentiment by stakeholders and experts as the country ponders ways out of its economic problems.
Brand South Africa (BSA), established to help create a positive and compelling brand image for
the country, is forging a platform for South African industry leaders to play an active role in exploring ways to bounce back from current downgrade status.
Through consultation, BSA aims to gather insight and advice from industry experts on how best to manage the impact the downgrades have on the reputational profile of the Nation Brand, while also focusing on suggested solutions/strategies towards recovery, said Petrus De Kock, the BSA General Manager: Research.
“We need to talk to each other and not across each other,” said de Cock.
A trustee of the organisation, Mpho Makwana, concurred.
“The core mandate of such gatherings is to engage in fruitful discussions that are solution orientated,” he said in Johannesburg.
Makwana believes the digitization of a fact sheet on South Africa to better inform, equip and educate citizens on the vast opportunities the country had to offer was crucial.
“This will be key in the flying of our flag globally to entice and secure foreign investment has to offer. South Africa is a gateway to 200 million Africans and a billion plus global visitors,” he added.
Lesiba Mothata, the Investec Chief Economist at Investment Solutions, said South Africa must take a cue from other countries that have been downgraded before.
“Taking notes from other countries that have weathered similar storms would serve as a
lever to activate effective solutions,” Mothata said.
Over the past three decades, 15 countries (none in Africa) have seen their investment-grade ratings revoked but were then able over time to regain this status.
A lack of confidence in consumer spending has also been described as a dire consequence of the
downgrade, worsening the situation.
“Consumers are shying away from spending due to feelings of insecurity regarding the state of affairs,” Mothata pointed out.
However, Makwana encouraged to minimise their debt through realistic spending.
“The golden rule is to live within your means,” said Makwana.
Analysts noted the role of the general public could not be underestimated as spending
patterns impacted on the recovery of gross domestic product and the subsequent economic rating.
Participants at a recent workshop BSA organised in Johannesburg also recommended complementary roles between media and relevant stakeholders.
Media, often accused of sensationalism and raising alarm on the state of economic affairs,
were urged to aid the road to recovery by accurate, transparent and unsensationalised reporting.
Peter Sullivan, a veteran journalist, emphasised media’s positive role in the debacle.
“We are passionate about the growth and development of the country and we are obliged to tell the truth,” he said.
In April, coinciding with a cabinet reshuffle, S&P and Moody’s downgraded South Africa’s sovereign credit to sub-investment level. Fitch downgraded the country to a notch above sub-investment. – CA J News