Former Eskom CEO Andre de Ruyter said South Africa should implement business-friendly policies that work and side with the right countries to fix its economic problems.
De Ruyter, a senior fellow at Yale’s Jackson School of Global Affairs, shared his views about the country’s financial challenges in a column published in Rapport.
He referenced Greece, which faced significant economic turmoil in the aftermath of the 2008 financial crisis.
The country was plagued by soaring debt, a bloated public sector, and systemic corruption. It was forced to implement stringent reforms.
Greece initiated austerity measures, pension cuts, and tax hikes to secure bailout packages under the watchful eye of its international creditors.
These reforms faced a public backlash. However, it stabilised the economy and reduced the country’s debt.
Greece’s economy is now recovering with improved fiscal discipline, increased foreign investment, and a resurgence in tourism.
It has also started to side with the Western world on many issues, like the war in Ukraine. It has secured a lot of goodwill from countries like the United States.
De Ruyter said South Africa’s government can turn the country around and grow the economy by following Greece’s example.
He advised South Africa to implement policies that would work to grow the economy and avoid mistakes of the past.
He cautioned against things like National Health Insurance (NHI), driving investors away with empowerment and procurement policies, and siding with rogue countries.
Should this continue, De Ruyter said, the rand will lose more value, our debt will rise and get more expensive, and we will lose international friends.
“Skilled young people will continue to leave the country, and our stock market will continue to shrink,” he said.
He cautioned that South Africa’s NHI could be the equivalent of Zimbabwe’s land reform and farm grabs – the last step of a total economic collapse.
It can be avoided, but only if the right policies are implemented. The alternative is to make the same mistakes as in the past and see the country deteriorate further.
South Africa to support countries based on its interests
In a Nuuspod interview, De Ruyter urged South Africa to support countries based on its interests rather than friendships.
He said South Africa is a small country that does not feature much in the United States. “We are irrelevant to the average American,” he said.
The country should, therefore, serve its interests through international affairs to make itself more relevant among investors and trading partners.
He quoted former US Secretary of State Henry Kissinger, who said, “America has no permanent friends or enemies, only interest”.
De Ruyter said a country should not support another country because of friendship. Instead, it should base its support on serving its interests.
“South Africa has many friends. However, we do not always strive to serve the country’s interests,” he said.
A good example is South Africa’s recent decision to take Israel to the International Court of Justice for genocide against Palestinians in Gaza.
It received support from the Organization of Islamic Countries (OIC), Malaysia, Turkey, Jordan, Bolivia, Pakistan, the Arab League, Brazil, and Colombia.
However, countries which support Israel include many of South Africa’s trading partners, including the United States, Germany, and the UK.
South Africa is, therefore, positioning itself with global friends, which will not help advance its interests. It also risks souring relations with its biggest economic partners.