As is tradition, let’s preview the most important business developments and trends that we can anticipate this year (look out for Brent’s editorial a little later this week where he will focus specifically on SME matters).
Barring an outlier event, I expect more noise and less action than normal with the 2019 national elections taking center stage. Anything other than muted economic growth would surprise me, so I consider Goldman Sachs’ forecasted growth rate of almost 3% exceedingly optimistic. Even without the political distractions, there are plenty of economic constraints. Multiple parastatals remain cesspools of corruption and incompetence, load shedding is in full swing, and the land expropriation debacle is still unresolved.
The election circus also means that any significant policy changes are unlikely. Tito Mboweni’s budget speech will doubtlessly include plenty of rose-tinted bluster, but I’m confident the walk won’t match the talk. Tax hikes are election anathema, so I will be very surprised by any upward adjustments. If anything, I expect some token tax breaks to curry political favour.
Similarly, I don’t anticipate any significant legislative developments. However, there will still be plenty of administrative headaches due to the scope and diversity of regulatory amendment last year. The Protection of Personal Information Act, national minimum wage, labour law revisions (including the introduction of parental leave), as well as the Youth Employment Service are just some of the changes that were approved in 2018 and that many business owners still need to accommodate.
You should also brace yourself for fresh compliance enforcement initiatives. For example, the Department of Labour recently announced that it plans on introducing employment equity certification, and linking its certification system with the National Treasury and Department of Trade and Industry. The inevitable conclusion is that this will be a prerequisite for government funding programs and tenders.
This isn’t particularly original since Broad-Based Black Economic Empowerment certification has been a requirement when applying for government finance, certain business licences, as well as state contracts for some time now. I’ve cautioned before that I expect this trend to continue, and the introduction of employment equity certification will add another layer to an already messy bureaucratic canvas.
In summary, I expect 2019 to be a relatively tepid year with political shenanigans shoving everything else to the periphery. Try to ignore the electioneering nonsense and focus, instead, on what actually matters: delighting your customers, growing your business, and creating more wealth.
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