By Prof. Busisiwe Mavuso
- US tariffs pose a severe threat to South Africa’s manufacturing and farming sectors, particularly in the Eastern Cape. While businesses can eventually adapt, urgent temporary support is essential. The recently announced Export Support Desk is a welcome first step, but swift implementation of broader measures is critical.
- A Trade Crisis Committee should be established, modelled after successful crisis response frameworks like the National Electricity Crisis Committee. This body, including National Treasury, business leaders, and key government departments, would ensure fast, coordinated action to open new markets, provide financial support, and maintain employment.
- Accountability in government is continuing. The dismissal of 38 officials from the Department of Home Affairs over the past year, including five recent cases involving serious misconduct, reflects a growing commitment to clean governance.
- Ongoing investigations and arrests at the Department of Public Works, the police service, and municipalities – including the high-profile prosecution of former Umzimkhulu municipal manager Zweliphansi Skhosana – demonstrate that accountability is extending to broader government.
The economic fallout of US tariffs is a crisis for parts of our economy and we must actively manage it. I welcome President Cyril Ramaphosa’s announcement that “a number of measures” will be implemented to assist companies affected. These need to be put in place quickly or we risk catastrophic collapse of manufacturing and farming businesses, particularly in regions like the Eastern Cape which has major automotive industry supply chains. On the weekend a company that builds sophisticated machinery and software for the automotive industry in the province, Jendamark Automation, said it had lost contracts worth R750m as a result of the tariffs. Jenda employs 500 people, but purchases inputs from other companies who employ 3,000. In the Western Cape farmers producing everything from raisins to ostrich leather also face considerable uncertainty as a result of the tariffs. Over time, companies can identify new markets and pivot to different outputs, but the short-term shocks could destroy many jobs that will never come back if we don’t provide temporary support.
The first such measure has been announced by DTIC minister Parks Tau with the establishment of an “Export Support Desk” in his department which companies affected by tariffs can contact. The desk will support them through the global network of high commissions and embassies to access new markets.
The desk could productively assist businesses to access new markets, and I hope it does so. But business is at the coalface every day, engaging with customers around the world, seeking new markets and looking to strike deals for our factories and farms to supply goods. We have a great deal of experience in understanding what makes access to a new market feasible and what frustrates it. There are many parts of the story, starting with logistics and the physical challenges of getting goods to a new location through to the trade policies of the markets we could be serving.
A standing crisis committee, consisting of business leaders and government officials from key departments, should be established to ensure rapid information flow and coordinated efforts. I encourage the president to establish a Trade Crisis Committee that brings together business leaders and key government officials to jointly chart a path forward.
This committee must include National Treasury. We already have proven crisis response tools that were developed for Covid-19 and the 2021 KwaZulu-Natal unrest. These can be adapted for our current trade challenges. Temporary loan schemes and employment support programmes will be essential to prevent a jobs catastrophe as factories face closure.
We have an excellent template to follow: the National Electricity Crisis Committee, which proved pivotal in addressing the energy crisis. This model is already being deployed through the National Logistics Crisis Committee and can be adapted for trade challenges. The Presidency’s coordinating role has been crucial in these examples, bringing together multiple government actors for rapid decision-making and joint problem-solving. Business and government working together will be vastly more effective than either sector attempting to navigate this crisis alone.
Accountability in government continues. News last week of five further dismissals from the Department of Home Affairs for offences ranging from fraud to sexual assault brings the number of dismissals in that department to 38 over the last 12 months. I applaud the efforts of home affairs minister Leon Schreiber to bring integrity back into the department. It is critical that Home Affairs is a reliable and trustworthy custodian of citizenship and the documents that make it real. The minister heaped praise on the diligent public servants who have helped accelerate disciplinary processes and work to clean up Home Affairs, stripping out the criminal syndicates that have done huge damage to it. That professionalism and integrity must be the standard we can expect from the whole of government.
Similar moves at the Department of Public Works and Infrastructure add to the momentum. The CEO of the Independent Development Trust has been suspended while an investigation into her and several other officials is carried out on an R800m oxygen plant tender. Over at the police, three officers have been arrested and charged with fraud over a R79m tender.
And in court, former Umzimkhulu municipal manager Zweliphansi Skhosana is behind bars over several charges, including the murder of former ANC Youth League secretary general Sindiso Magaqa. The hitman who pulled the trigger has already been sentenced to 25 years. I hope prosecutors can use the occasion to demonstrate the effectiveness of the NPA in dealing with politically-motivated assassinations. It is a completely unacceptable scourge that must be eliminated from our body politic. The case shows why the judicial commission being lead by retiring acting Deputy Chief Justice Mbuyiseli Madlanga has important work to do.
While we sometimes feel frustrated over the pace of reform and restoring our institutions from the state-capture era, it is stories like this that show we are making real progress. These arrests and dismissals simply wouldn’t have happened in the state capture era. We have much more to do, but we are heading in the right direction.
