Something has to be done to save the economy. That was the unanimous message after a meeting between Finance Minister Pravin Gordhan and top business leaders.
The meeting was called to brainstorm ways to avoid a junk credit rating, which is on the horizon.
“There was a clear realisation that a ratings downgrade would damage South Africa Inc considerably,” AngloGold Ashanti CEO Srinivasan Venkatakrishnan said.
“The clear conclusion was that the status quo cannot continue.”
Gordhan held his unprecedented talks with about 60 CEOs last week to discuss how to avoid a credit-rating downgrade to improve investor sentiment and to canvass their views before his Budget speech on February 24.
President Jacob Zuma will meet a similar group in Cape Town today. His State of the Nation speech is on Thursday.
Business confidence is close to a 22-year low and the economy is at risk of falling into recession as falling commodity prices, weak demand from China and the worst drought in over a century crimp output.
Today, Zuma will try to restore ties with business leaders and seek advice on shoring up the badly faltering economy.
Zuma “needs to be told it takes a long time to build a reputation for good business but it takes only minutes to destroy it”, said Piet Viljoen, chairman of Regarding Capital Management, which manages about R8-billion.
“Business is not the enemy, it’s part of the solution,” said Gareth Ackerman, chairman of Pick n Pay. “Business creates the jobs and maintains the government’s ability to pay for social services, and keeps the economy alive.”
