On the Brink: South Africa’s political and fiscal cliff-hanger
Review: John Harvey
Twenty years from now, South Africa and the world might look back at our current time in history as the country’s watershed moment.
Just as the end of apartheid plotted the nation on a new course, so what is unfolding politically is defining both the short- and long-term future.
Things are moving quickly now, particularly with the ascent of Cyril Ramaphosa as ANC president and the courts seemingly having had enough of politicians and their dubious associates making graft a national pastime.
With the dynamic changing daily, it is often difficult to stay up to speed with what has led South Africa to this point, and herein lies the value of this offering by Business Day economics editor Claire Bisseker.
Not only has she painstakingly broken down the complexities of the volatile political landscape and its impact on the economy, making it palatable to lay readers, but she has deftly chronologised events in such a way that the book also has significance as a record of history.
Bisseker has cut away the sentiment and emotion of populist politics to expose the facts of the matter, which clearly show that global markets are deeply troubled by the puerile brinkmanship occurring in the corridors of power.
From the initial shocking removal of Finance Minister Nhlanhla Nene by what has come to be known as the “weekend special”, Des van Rooyen, to exposing the “capture” of the state by a single family, the body blows keep coming as the battle for power supersedes the needs of the populace.
With each new event, Bisseker details market reaction and the waning faith of the international economic community in South Africa, culminating in the downgrades to junk status by the major ratings agencies.
Equally prevalent are the counter-punches delivered by those contesting the power struggle, with some even downplaying the importance of said agencies, deeming them nothing more than nefarious agents of foreign, and in particular, Western agendas.
However, Bisseker dismisses this argument by explaining precisely how these agencies work, and that, in fact, the market does not follow the ratings agencies but leads them. By presenting brutal financial truths, Bisseker has shone the light on an “alternative reality” being posited by the country’s leaders, one very much intended to pull the wool over the eyes of the citizenry as the Treasury is plundered.
On the Brink is by no means a light read, nor is it intended to be. By this time, most South Africans know the story but may not understand just how precarious the situation is.