Trudi’s true grit

Tuesday, July 24, 2018

By Neo Semono

New jobs generally come with the angst and pressure of making a good first impression. But, what does one’s anxiety and pressure barometer look like when your new boss is actually the President of the country?

Ask South African President Cyril Ramaphosa’s newly appointed economic advisor, Trudi Makhaya, and her response would be one of an easy smile.

Without having to give the question much thought, Makhaya describes her boss, who only just happens to be the country’s Number One as “rather easy going.”  

“I’ve worked for a great diversity of bosses and I think he is that one that you want; the open one; the one that gives good feedback and is accessible. So it’s been good,” she says with a warm, sisterly, girl-next-door smile that immediately leaves the receiver with a feeling of confidence and trust in this well put-together woman, who despite her humility, still exudes the sense that she has the grit needed to get the job done.

Makhaya’s cool and confident demeanour belies the fact that President Ramaphosa has entrusted her with the challenging task of spearheading an investment drive, aimed at attracting $100 billion in new foreign investment to South Africa’s economy. She leads a team of envoys that includes former Finance Minister Trevor Manuel, former Finance Deputy Minister Mcebisi Jonas and the executive chairperson of Afropulse Group, Phumzile Langeni, among others.

But, it is her role as the President’s economic advisor that has placed the spotlight firmly on Makhaya, a leading economist, writer and entrepreneur – a jack of all trades, one might say.

She describes her relationship with South Africa’s first citizen as one that’s “warm and open.”

“It’s all developing, but we all have had to hit the ground running in terms of the initiatives we’ve been involved in. It’s been good so far. He’s a good boss if I can say that,” she told SAnews in an interview recently. 

But, the Hammanskraal-born Makhaya admits to having her work cut out, considering the many challenges the South African economy is facing. She will be counting on the President’s open communication and leadership in order to steer the economy in the right direction.

“So far he’s very open. He’s given very clear directions in terms of his expectations. It’s been great, but obviously we’re still settling in, even amongst advisors we want to build a strong team so that we can also give each other feedback and build a strong structure.”

Since her appointment, Makhaya has had to dedicate much of her time to support the investment envoys in their drive to deliver on the $100 billion in investments over the next five years.

She is also working closely with government institutions that are central to the investment mobilisation drive.

These include development financial institutions such as the Industrial Development Corporation (IDC) as well as Invest SA (One Stop Shop), an initiative that aims to prioritise and promote investment.

Although some people may not have heard of Makhaya before her rise to the top office, she has made her mark in the business world and has founded her own advisory firm, Makhaya Advisory, which focuses on competition policy and entrepreneurship.

She has held non-executive directorships at Vumelana Advisory Fund and MTN South Africa. She also joined the Competition Commission in 2010 as principal economist, later becoming the commission’s deputy commissioner.

She has all the academic qualifications to advise the President on any economic issue. These include an MBA and an MSc in Development Economics from Oxford University, as well as an honours degree in economics and a BCom in Law and Economics. She is also a regular columnist for the Business Day newspaper.

Makhaya is aware that to achieve on their big task, the President’s economics team will have to cast the net very wide.

Recently, South Africa signed the Africa Continental Free Trade Area (AfCTA) agreement which offers an opportunity to create larger economies of scale, a bigger market and improving the prospects of the African continent to attract investment.

Makhaya says it is the task of the President’s investment envoys to ensure that the AfCTA is linked to their work.

“We want to say if people are coming to invest here, they are not just doing it to serve the small market but that there’s actually a bigger market being the rest of the continent,” she says.

The envoys are also firming up relationships with international investors, some of whom already have a footprint in the country.

One of these investors is German car maker Mercedez Benz, which last month unveiled a R10 billion investment into its Eastern Cape plant.  The investment will see the company produce the latest range of luxury C-Class cars.

Makhaya is of the view that this is a great investment for South Africa and shows that the country’s auto industry is integrated in terms of industrial development.

She says the team is also engaging with major investors on the continent, adding that it cannot always be South African companies investing in other African states.

She also reflected on the recent World Economic Forum (WEF) held in Davos, where South Africa held roundtable engagements with several potential investors.

“We had a very open policy discussion in order to understand what their concerns were. I think that was quite useful in terms of the fact that there were Ministers in the room listening to feedback but also giving their impressions about what the South African investment story is.”

Among the concerns raised by investors was around South Africa not sticking to a policy path, thereby creating a lack of clarity.

The investors, says Makhaya, seem to understand South Africa’s need for Black Economic Empowerment (BEE) and the need for land redistribution. However, policy certainty and policy clarity remained a big issue for them.  

Other issues raised were around those in the telecoms sector where concerns were raised around spectrum allocation and what the market structure will look like in the future.

It was reported earlier this year that South Africa plans to allocate more radio frequency to various players by March 2019. The allocation of the spectrum is key to expanding South Africa’s broadband facilities as the high cost of telecommunications is seen as a barrier to doing business.

Other concerns investors raised were around the Mining Charter which is likely to be finalised towards the end of the year.

“Investors would like to see this being wrapped up soon,” says Makhaya.

“Investors also understand the land debate but there’s anxiety on whether it will be managed in line with the law and also are we going to make it clear that it doesn’t affect new investment in terms of expropriation.”

The National Assembly in February adopted a motion for a constitutional review allowing for the expropriation of land without compensation. The matter was referred to the joint constitutional review committee to review section 25 of the Constitution and other clauses, if necessary, to make it possible for the state to expropriate land in the public interest without compensation.

Asked about her expectations of the upcoming BRICS Summit in Johannesburg, Makhaya says the summit is a very important gathering for the country and for the work that the envoys have been doing.

China remains one of the biggest investors in the South African economy and there is a need for South Africa to encourage Russian and Indian investment into the country, she says.

“With Brazil we’ve had misunderstandings about chicken in the past, we also need to resolve that.

“With India, sometimes I feel that maybe we are not doing as much as we should. There are good Indian multi-nationals in SA, but we need to obviously encourage them to invest more.”

South Africa, which joined the bloc in 2011 will host the Summit for the second time from 25 to 27 July.

Meanwhile, preparations for the Jobs Summit are ongoing and Makhaya says the plan is to ensure that the summit provides practical ideas on how to deal with the country’s unemployment problem.

Government is also putting together its own technical working teams on various topics to be covered at the summit, says Makhaya.  –