Gideon Rachman: SA must stop scoring own goals. It’s a tougher world today

Financial Times columnist Gideon Rachman is one of the world’s most influential journalists, his weekly column eagerly consumed from Beijing to Benoni and back. As he has a South African connection – his parents hail from the country where he spent three years as a child – Rachman takes a close interest in the nation’s progress. Just before he left to travel home to London, I asked Rachman for his takeaways from the 46th annual WEF meeting and, at the end of the interview, his thoughts on challenges facing SA. The FT columnist’s conclusions should act as the cold shower ANC politicians clearly need after trying to spin SA’s 2016 Davos as a great success.

Gideon Rachman is with the Financial Times of London. Your weekly column is well-read all over the world, including in South Africa where you have a connection.

Yes, I do. My parents are South Africans. They actually emigrated to the UK in 1959 and I was born in Britain, but we retained a connection with the country and I actually lived in South Africa for three years (I guess in the height of Apartheid, 1967-1970). I was child, aged 4-7. I would go back occasionally, as does my mother. So yes, I have a connection with the place.

So you keep a little toe in the water there to see what’s happening to the ‘beloved country’ as Paton called it….

Yes, definitely. Even when I’m in the UK or elsewhere, through the family connection it’s a subject that comes up around the dinner table a lot, apart from anything else. Of course, that means I read South African news with unusual attention of all the countries I follow.

When you go home this afternoon, what are you going to be taking back from the 2016 meeting?

Look, there are immediate impressions and then there are other things, which you think about over the course of the year. For me, Davos is a bunch of disconnected conversations, some of which you only realise the significance of a few months down the road if something happens e.g. in the South China Sea. I’ve had conversations with the Chinese and the Americans about what they’re thinking. Just the opportunity to meet many different people quickly, allows you to fill up your base of knowledge on many different subjects. For example, for the first time I was able (as you were, Alec) to meet the President of Argentina and to listen to him for an hour. I’m not going to write about that immediately, but it means that I have a sort of sense of where that country’s heading and where he fits into the global picture.

In terms of broad themes – on the political front, which is mainly what I follow – I think that there’s a deep anxiety on both sides of the Atlantic about what they call populism here. By which they mean people who don’t really agree with the Davos agenda and promote things Davos doesn’t like. For example, trade protectionism or closing borders. In the US, people are beginning to think Donald Trump could win the Republican nomination. He could even win the Presidency and what would that mean for America’s standing in the world – the global role of America. So far, that’s still hypothetical. But Europe has a real crisis on its hands right now, the refugee crisis. That has several levels to it. It’s a human tragedy with millions of people who have now been displaced from Syria. It’s also a social problem with Germany getting over one million would-be refugees and asylum-seekers last year and the flows keep coming.

It’s also turning into a political problem, which is where this whole populism thing comes because this time last year, Merkel would probably have been regarded as one of the most successful leaders in the world – certainly in Europe. Now her position is seriously under threat because the German public is very anxious about what’s going. You’re beginning to see… I don’t know whether you’d call them a far right party but certainly, a pretty hard right anti-immigrant party, and an anti-euro party making gains that it just wasn’t doing a year ago.So I think there’s a lot of anxiety about that in Europe. If I had to summarise it, people often say this is a global business and political thing and I guess it is. And they have the sort of unpleasant feeling that the things they regard as good and they promote around the world in terms of economics and politics are increasingly under challenge. I guess that would be my big takeaway.

The UK’s Chancellor of the Exchequer George Osborne was on one of the panels earlier. It was interesting to hear him raise the whole story of immigration from a country, which is known for its tolerance, raising flags….

Yes. Put it this way. I think it’s almost unthinkable that Britain could have done what Germany has done without having a semi-revolution. Immigration’s been a very hot topic in the U.K. for about a decade or so. Why that is, is quite hard to tell. We have had quite high net immigration. It’s about 300 000 per year – it’s as if we’re adding a city the size of Birmingham every three or four years. Some people feel that’s put downward pressure on wages because you have many quite skilled people coming in from Eastern Europe because of free movement of people within the EU who are prepared to work for less money than the Brits would have taken. It’s also pressure on housing, school places etc and that has led to the government promising to try control immigration.

They clearly felt that was a vulnerability and tried to reduce the numbers from hundreds of thousands per year to tens of thousands per year and they’ve singularly failed to do that. It’s a bit of a vulnerability for them because it’s a promise they’ve made and they’ve just not been able to keep. It’s very hard, particularly if you’re a member of the EU because you have free movement of people. You cannot say we’re going to limit people from the EU. And that is going to be one of the big issues in the European Referendum, if not THE issue from those who want to say, “Well actually, we would like to be able to control how many people come into the country.” In a funny way, it’s also in a different sense an issue for South Africa. You’ve had many people coming in from Zimbabwe and from the rest of Africa, and people are upset about it. It’s an issue all over the world.

The whole concept of Brexit is news here, Britain possibly leaving the European Union. What odds would you put on that happening?

Well, the bookies are probably a better gauge than I am, and they say it’s 2:1 against so it probably won’t happen but you can’t rule it out. The two most recent opinion polls have shown that the majority is wanting to leave. It’s going to be a real uphill struggle for the Government to persuade Britain to stay. I still think – maybe because I spend too much time in places like this where we all reinforce each other’s view of what’s thinkable – we’ll stay in. But I wouldn’t be amazed if I met you this time next year and we had just voted to leave.

If we were have a look to 2017, is the world going to be a more dangerous place at that point? It seems to be maybe a little less dangerous this year than it was last year with Putin not quite on the rampage as he was.

Yes. People were really worrying about war in Europe this time last year. Russia seems to have dialled it down. They’ve also expanded their struggle into Syria, which is to some extent bogging them down. And the Russian economy is also very weak. The low oil price is hammering them. Yes, I think that immediate concern has gone. People are watching a little bit nervously what’s happening with China and its neighbours. Not that anyone wants a war or think the Chinese will gamble in the way that Putin did by actually grabbing territory. That’s not going to happen, but there is tension with US and in their navy in the Chinese territorial dispute. Of course, then there’s the Middle East conflict, which, if anything, is escalating. Each year, we come here and we say, it’s a terrible tragedy in Syria. We have to sort it out. It doesn’t appear to be being sorted out.

If anything, because the relations between Saudi Arabia and Iran are getting worse to the extent that the Syrian war is a proxy conflict between those two countries, it’s going to become harder to settle. That’s becoming more of an international security threat because one of the reasons that we were prepared to ignore it for a while is that although people were suffering, people in Europe felt remote from it. Well now, with the refugee crisis, we know we’re not remote from it. With ISIS and with terrorism and the fact that so many of these people appear to have trained in Syria, the sense that the Middle East crisis is now a direct threat to the European Union is something that has ramped up over the past year because of refugees and terror. It will be very interesting to see whether that intensifies over the coming year. If it does, I think Europe will face all sorts of difficult questions.

The Europeans, unlike the Americans, have zero taste for military intervention in the Middle East but maybe they’ll have to start thinking about it.

As far as the British are concerned, are you starting to worry that the problems that have affected Paris will come to your country?

Well, it’s happened before. It happened in 2005 with the London bombings. If you’d said to us then there won’t be any more of this for ten years, we would have been extremely relieved and probably a bit surprised. I think people think it’s inevitable. So far, the Intelligence Services have been pretty good at disrupting them. Every few months, there’s a trial, somebody in the Old Bailey is sent to prison for trying to blow something up. The thing about terrorists is eventually, they’ll get through. London’s a big place. There are eight million of us and if 50 people are killed it’s horrible, but life goes on.

At the moment, you’re able to trust a security system that actually works?

The British are actually a peculiar nation in that we really like our spies. I think the Americans are very worried by the FBI snooping on them. You saw the reaction to Snowdon etc – the big reaction to Snowdon in France and Germany. Maybe because of the mixture of history and the veneration of James Bond etc, the British respect the Intelligence Services plus (maybe more concretely) they know we’re under threat and so they would actually prefer that these guys are looking at people’s emails to check what’s going on.

Just to close off with, a view on South Africa…

Well, I think that South Africa scored an own goal in terms of public relations with this to-ing and fro-ing over the Finance Minister in recent months. I think that many of the negative feelings about President Zuma that I picked up when I was last in South Africa about a year ago have filtered out of the country now. People sense that South Africa doesn’t have a terribly effective President and they worry that that is beginning to affect the economic environment and the investment climate. Still, it’s regarded as the most westernised, most advanced bit of Africa. A place where people wouldn’t feel concerned. That if they flew into Cape Town they wouldn’t  be in some kind of alien environment. That is a big plus for South Africa in a sense, but I do think that Zuma’s administration echoing some of the complaints that are made in South Africa…those have filtered out around the world and people are looking at things like corruption. They’re looking at low growth, unemployment, and worried that these things are all correctable. Will they be corrected, though? I think there’s a lot of attention to what happens after Zuma. Who’s the next President? Would it be someone who could perhaps restore the country’s image and do some of the necessary reforms. Or is South Africa now on a trend where it’s going to be gradually getting worse and worse?

Gideon Rachman is a columnist at the Financial Times of London.

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