Johannesburg gets a makeover for costly G20 summit, but is it really worth it?: Katzenellenbogen

Key topics:Johannesburg preps streets, security, and lights for G20 SummitSA removed from FATF grey list to avoid international embarrassmentSummit offers prestige, but limited economic or political gains for SA.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Jonathan Katzenellenbogen*.Parts of Johannesburg are being cleaned up for the upcoming Group of 20 (G20) Summit, and the ANC is working hard to put a shine on the country’s standing and its own, ahead of the meeting.As president of the G20 for the past year, South Africa’s moment of glory is close at hand. Leaders from the world’s largest economies will meet at the Nasrec Exhibition Centre near Soweto, on 22 and 23 November.For years, many of the robots in Sandton, where some of the world leaders will be staying at the luxury hotels, have been out of order. Most of the robots now work, and it is a pleasure to drive. Worn-out and often unreadable road markings have been freshly painted. The streets are cleaner and there are more Metro cops in the area.After years of near-darkness, streetlights on the M1 now shine. But drive along Louis Botha Avenue and it still looks like a disaster area. But then it is not on the route from Sandton to Nasrec..Read more:.Johannesburg’s traffic lights are crumbling, leaving streets in chaos.So far, the G20 has been good for Johannesburg, but there might not be many more benefits. Besides, roadblocks for leaders’ convoys await.The G20 was established in 1999 to allow finance ministers and central bank governors to better respond to the spate of emerging market crises during the late 1990s. With the collapse of Lehman Brothers and the ensuing Global Financial Crisis in 2008, the G20 took on a new role and became a forum for meetings of world leaders.In spite of its name, the G20 consists of 19 countries and the European Union and African Union. It represents 85 percent of world GDP, but the giant share of that is accounted for by the US (26.5 percent) and China (about 18 percent).SA is fortunate to be a member of the G20. We only rank 40th in the size of our economy, and Argentina, also a member, ranks 25th. All the other country members have among the largest twenty economies. In order of the size of their economies, the members are: US, China, Germany, Japan, India, UK, France, Italy, Russia, Canada, Brazil, Mexico, South Korea, Australia, Turkiye, Indonesia, Saudi Arabia. The Mandela legacy and the need for an African member got us into the club.Lick of paintApart from the attempt to cover up Johannesburg’s ongoing decay, a lick of paint is also being applied to improving the country’s reputation ahead of the arrival of world leaders. Just in time for the Summit, the National Treasury has managed to get us removed from the Financial Action Task Force’s “grey list.” Being on the “grey list” would have caused us serious embarassment at the Summit. It means a country has serious deficiencies in dealing with money laundering and terrorist financing.The last thing that President Cyril Ramaphosa would want is for a fight to break out in the GNU in the lead-up to the Summit. After all, a real battle in the GNU could result in his eviction from office. Over the weekend, Ramaphosa managed to get a commitment from the nine other parties in the GNU not to wreck the arrangement, at least during the G20 Summit. He got the wording he wanted in the final statement: “The leaders were unanimous that the GNU is united and strong.”For all such strong words and a statement that reads like an ANC draft, the DA clearly did not push for its own priorities like abolishing Black Economic Empowerment and privatising state-owned enterprises. The DA has agreed to be co-opted in backing the bold and noble patriotic cause of hosting the G20.Our government has budgeted more than R690 million for the Summit itself. But there have been multiple meetings, including those of finance ministers and central bank governors as well as health and tourism ministers and business leaders. So the total cost might well be more like a billion rand, if not more. At a billion rand, the total cost of the G20 may come at around 0.04 percent of this year’s total budgeted spending.That does not break our public finances, but is it all worthwhile?No, it is not.A lot moreOne of the benefits of hosting the G20 in Johannesburg, we were told by the ANC, was that it would spur investor interest. Without deep economic reform that allows the railways, ports and power stations to operate at some degree of efficiency, we are not going to see this. We would get a lot more out of the G20 if we had a powerful growth story to tell.Hosting the G20 provides the sort of glamour event that the ANC likes. The country gets three days of cursory international TV coverage, and the President is shown meeting leaders from all over the world. And our public broadcaster will report another great moment for all of us.Coming up with a communiqué for the Summit will be a difficult task and is one reason the result will not be earth-shattering. There is little doubt that the “Sherpas”, the diplomats responsible for negotiating the agenda and the communiqué, have been working overtime for months to come up with a text that can satisfy libertarians and liberal democrats and authoritarians.Ideally, Ramaphosa wants a lot more aid for Africa and a bigger say for the continent at the World Bank and International Monetary Fund. But with Trump and pressures on aid, that is not going to happen to any big extent..Read more:. UAE nears exit from FATF ‘grey list’ following robust crackdown on illicit finance.The result will be one of those dull ‘consensus’ documents whose paragraphs have largely been agreed to in other forums. That is the problem with the G20. The matters with which it deals are also dealt with in other forums. If the group had been for finance ministers and central bank governors alone, it might have more impact in the world.Sinking to new depthsPresident Donald Trump’s absence from the Summit will take away much of the impact the event might have had. With relations between the US and South African sinking to new depths earlier this year, Trump said he would not be attending.The themes of SA’s Presidency of the G-20, “Solidarity, Equality and Sustainability,” as well as “Ubuntu” with its connotations of interconnectedness and collective action, were an instant turn-off for Trump. His Vice President, JD Vance, will be in Johannesburg, but he is very unlikely to display any great enthusiasm for the event.The real value of such large gatherings as the G20 and state funerals lies in the one-on-one face-to-face meetings that leaders can have. That just might be the reason why the G20 survives..*Jonathan Katzenellenbogen is a Johannesburg-based freelance journalist. His articles have appeared on DefenceWeb, Politicsweb, as well as in a number of overseas publications. Katzenellenbogen has also worked on Business Day and as a TV and radio reporter and newsreader. He has a Master's degree in International Relations from the Fletcher School of Law and Diplomacy at Tufts University and an MBA from the MIT Sloan School of Management..This article was first published by Daily Friend and is republished with permission

Johannesburg gets a makeover for costly G20 summit, but is it really worth it?: Katzenellenbogen

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