A Letter From The Chairman’s Desk

Dear Warwick clients, supporters and friends,

I have recently returned from a business trip to the UK and Channel Islands and wanted to share some of the insights I picked up when talking to asset managers, investors, regulators and friends with an interest in South Africa.

First though, a few observations about the UK itself this year. The first and most obvious is the anticipation of elections. While a general election will be held by the end of the year and possibly as late as November, local government elections are scheduled for 2 May. The Conservative Party is expected to suffer a heavy defeat in both. The UK electorate appears to have had enough of 14 Years of Tory rule and there’s widespread dissatisfaction with the government’s performance, particularly during and after the Covid crisis. The much-vaunted benefits of Brexit have not materialised and were the referendum to be held today, the remainers would probably prevail. Of interest, however, there is also little enthusiasm for a Sir Kier Starmer Labour Party government among those with whom I consulted. Indeed, some wags contend that the choice facing the UK electorate is akin to Trump versus Biden, but this is very wide of the mark.

But what are my interlocutors saying about South Africa thirty years into democracy and heading into or our own (possibly watershed) elections? The first takeaway is still the tremendous goodwill felt towards our country. Admittedly, just about everyone I met with had visited the country or was well-informed about it as you would expect from asset managers and other professionals. Nobody I met with wanted South Africa to fail as a state, to the contrary, there is a genuine desire to see our country recover, prosper and reach its full potential. However, asset managers and other professionals expressed concerns not just about our economic and infrastructure challenges (“Is your electricity and water crisis really that bad Ian, was a Common refrain), but the country’s future political and policy direction.

While I was able to explain the economic challenges facing the country and the steps being taken to tackle these, I found it more difficult to ‘divine’ the future political direction. But my response was as follows. South Africa is a functioning democracy and a constitutional state. Our elections are credible, internationally rated as free and fair and what we are seeing in the current polls is a sign that democracy is working. The electorate is beginning to move away from racial, ethnic, sentiment and political brand voting and towards more varied, informed and issue-based voting. The emergence of some credible independent candidates bears testament to this, as does the formation of the Multi-Paty Charter. The other certainty is that the ANC will emerge from the elections as the single largest party, even if it does not garner 50% of the vote. This would lead one to conclude that irrespective of the outcome, we are likely to see significant policy continuity (good, bad and indifferent) in the short-to-medium-term.

Of course, the composition of any possible future coalition government will influence policy direction and, in this regard, the international asset managers and professionals I met with in the UK were all hoping for an ANCMulti- Party Charter coalition to emerge after the May 29 election. This may be somewhat naïve, but time will tell!

To conclude this introduction to Wealth Matters on a more joyful note, 2024 marks the 30th anniversary of my founding of the Spirit Foundation (https://spiritf.org/). And I would urge you to take a few minutes to go onto our website to see the wonderful work we do in providing education opportunities to disadvantaged scholars, our programmes to uplift communities and assist those with disabilities and our support for the protection and preservation of our iconic endangered wildlife. It is also a fundamental operating principle that 100% of all donations made the Spirit Foundation go directly into our programmes and not to overhead. So, why not consider celebrating 30 years of our country’s democracy with us by supporting the Spirit Foundation and donate today?