Cyril to the world: Get in now while SA is still cheap

By Alec Hogg

In presenting his first mini-budget yesterday, SA finance minister Tito Mboweni applied an approach applied by virtually every incoming public company CEO: if it moves, write it down. That way credit will accrue much easier when any "turnaround" arrives. And Tito certainly laid it on thick in Parliament yesterday.

There's an eye-popping R11bn backlog in outstanding VAT refunds owed by SARS; and a hole of almost R60bn in the 2018/19 Budget through revenue under collection and excessive increases for public servants. Even before the VBS hole, municipalities owe R23bn to Eskom. SA's Debt-to-GDP ratio will get to almost 60% by 2023. And this year's projected GDP growth of 1.5% has been downgraded by half.

Taken in isolation, the message is nauseating. But Mboweni is playing to a broader narrative. It is the cornerstone of what his boss, president Cyril Ramaphosa is to sell over the next three days to 1,000 worthies assembled at his Investment Conference in Sandton: Zuma's era of mismanagement is over; SA is on the turnaround path.

After decades in boardrooms, Ramaphosa knows every investor loves a bargain. So in between the networking, deal-making and hype of the summit, his message will be clear: get in now while SA is still cheap. That, in a nutshell, is the pitch of his $100bn, five year fixed investment dream. Let's hope it works.