Cosatu warns looming Western Cape strike will ‘devastate’ economy

Letter from Chris Whelan to the Business Day

I read with some concern the article of 10 July in Business Day referencing a threatened Cosatu strike in the Western Cape within the next 2 weeks. The approach outlined tends towards willful negligence – or lack of effective understanding of the realities of global economies – on the part of Cosatu and its regional leader, Tony Ehrenreich, with respect to the growth and development of the regional economy.

Mr Ehrenreich raises concerns in the article – real, valid and pressing concerns – which must be appropriately addressed. The National Development Plan creates a framework to do this through developing a common vision of success and robustly executing against that, in partnership with key role players. An economy built on weak foundations, including an unsustainable disparity between the wealthiest and poorest in society, with inadequate access to economic opportunities and where social mobility is severely curtailed, is one which cannot thrive in the long-term. The tension referred to by Mr Ehrenreich can indeed undermine long-term economic prospects – and to coin a phrase, could represent a ‘clear and present danger’ to the long-term future of South Africa.

However, the way to address our common challenges is not through empty rhetoric. Mr Ehrenreich makes a few claims in the article. Two, at least, require a response. First, he says investors gain confidence in the economy where they see wage bargaining agreements in place. Even if that were true, the approach being proposed – undertaking a “generalized strike…”bigger”” than the agricultural sector strikes of late 2012 and earlier this year is irresponsible. It ignores the reality that global ratings agencies, monetary institutions and investors have publicly and repeatedly stated that prospects for growth are harmed by, amongst other things, a labour environment which is not sufficiently flexible and seemingly beset by ongoing strike action and conflict.

Second, Mr Ehrenreich says “we have the Economic Development Partnership where we are not represented”. It is for the EDP Executive to comment more fully on that, should they choose to. However, the statement as it stands is disingenuous. From my own discussions with various business and civil society leaders, numerous approaches to Cosatu have been made to participate in the EDP. That the union federation have thus far declined to do so is unfortunate, to say the least. The EDP represents a neutral ‘space’, where all stakeholders can engage in dialogue designed to create partnerships to secure the long-term future of the Western Cape.

In threatening strike action which would “devastate” the economy”, Cosatu demonstrates a profound disregard for the levers available to alleviate poverty and overcome current challenges. If the economy does not grow, there cannot be funds to address the social ills which we are all deeply concerned by. Fighting over an ever-shrinking ‘pie’ is a sure recipe for defeat. Only through growing a robust, sustainable and inclusive economy, coupled to excellent service delivery at a local, regional and national level, can we address the significant challenges our country faces.

Chris Whelan
Chief Executive Officer: Accelerate Cape Town

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