PETER ATTARD MONTALTO: Things that annoy me

The SA habit of putting ice cubes in wine is a topic for a column given there is noting left to say about the election.

Or another pet peeve is the use of the term “all protocols observed”. I am quite sure no other country says this. You can list endless regional functionaries at an event or don’t bother at all.

Media coverage of this election remains awful. There is very little sense of a thread that connects the actions on the ground of voters; it remains a focus on those wanting to be elected not those doing the electing. The fascination is with things that won’t affect the outcome — such as Constitutional Court cases for someone who has already said (and now admitted in court papers) that they won’t take up their seat.

The media doesn’t seem interested in answering some pretty basic questions that actually matter.

For instance, is the ANC machine actually working to drive numbers up from the polling levels to vote day? Or the fact we all know full well that the Gauteng ANC has a love for the EFF but will the national party allow them to get away with it forming a coalition or not? (Before anyone writes a letter — yes I do have the answers to these questions but I am not going to put them in a newspaper column.)

Markets, meanwhile, continue to get the wrong end of the stick. They underestimate how conservative the ANC national executive committee (NEC) is and how that will reflect through elections, and they underestimate what this means for the choice of a coalition partner. NEC members know what an equity market is and know what will happen to it with an EFF coalition. They remember Des van Rooyen’s effect on markets, which would have been a walk in the park compared with what an EFF coalition would look like.

It feels, however, like the smart money is converging on a view that there could be a significant market rally after the elections. There is the confluence of a few factors. First will be the raw removal of uncertainty risk premiums; second the avoidance of an EFF coalition at national level; and third the broad status quo vibes of a coalition government after a few months.

More than that though there are some underlying trends the market is (ever so slowly) waking up to. Load-shedding is slowly being solved (looking through the temporary pre-election lull) and serious work is going on to solve the logistics crisis (even if it will take some time).

The key issue, however, is that fiscal outcomes are far better recently than markets were prepared to hope for, despite the National Treasury telling them so quite continually and quite clearly. The Treasury has also throttled back issuance of long-term bonds, and markets seem finally to be settling to the view that the use of the gold & foreign contingency reserve account is not quite a three-headed hydra and is not about to lead to massive spending on state-owned enterprises (SOEs) that wouldn’t have otherwise happened.

All this is long overdue, of course, and such is the yoke an analyst has to bear, being like the crazy person in the village who screams at passing cats.

This is not to say that everything can’t go completely to the dogs after the election. All these assumptions could turn out to be wrong. But if one follows the maths of the polls and various scenarios and permutations as well as the sheer march of the constitutional timetable to elect a president on the first sitting, scenarios become a little constrained. This election is not completely unknowable.

However, a relief rally might be at risk of covering up problems. We don’t want to fall again into the awful sick bucket inducing trap of Ramaphoria, when too many business people and investors were willing to ignore the huge pile of work still to do and ignored many an issue staring them in the face.

Similarly, now we may well be solving fiscal, load-shedding and logistics (at varying speeds) but we still have a smouldering radioactive waste pile that is the policies of the department of trade, industry & competition. There are deep demographic issues that need resolving around grants and there are minefields in education with teacher numbers, not to mention that more and more municipalities are falling over, leading to desperately poor quality of life outcomes.

And then there is an inner heart of the government — the state law advisers — that remains the blockage to so much happening at speed for the reasons laid out in its staff’s recent plea for help.

The trade department issue is perhaps most interesting. For whatever one thinks of the DA and its economic policy (we have many niggles for sure in the detail), the fact that there is such a marked alternative to the administration’s abject failure of industrial policy and the complete failure of a minister to manage a department and its institutions is refreshing to say the least.

The wailing cry of the unions in response to the policy release is interesting to watch because the unions themselves have been increasingly critical in private of the department’s abject failure to create jobs and create a conducive environment for members. The dismal view of the department also seems to be widely held around the government and the wider public sector almost as much as to say it is consensus. It seems it is only at the pinnacle that the minister is held in high regard.

The gossip around polite dinner parties of ANC-connected folks is that the minister will be ditched after the elections. Yet I don’t hold my breath (nor for the inevitable destruction of the department of public enterprises and retirement of its minister). Looking at the ANC list, it seems there is a lack of particular alternatives. So one either risks getting the same minister back given no other options or cursed with the return of the old guard. Lord help us.

This is the ultimate thing that annoys me. The deep desire of the SA media and various leaders to rally around a cabinet after appointment and say it’s for the best. No.

We know what works and what doesn’t work. We know the skills needed to be able to gazette a piece of paper timeously, to be able to manage a department, to build capacity and build a credible institution and to have a vision for the future of the portfolio and garner advice and expertise and be able to run with it.

We must hold a future government to a higher bar than we have done before.


Peter Attard Montalto leads on political economy, markets and the just energy transition at Krutham, a SA research-led consulting company.

This article first appeared in Business Day.