“We need to place our continent on the map precisely as an investment destination”
See interview credit towards interview end
ALEC HOGG: In this special podcast coming to you from the World Economic Forum in Davos, the group chief executive of the Absa Group Maria Ramos is in the studio. Maria how many times have you been to Davos?
MARIA RAMOS: I’ve actually lost count, but it must be 14.
ALEC HOGG: …and over that time?
MARIA RAMOS: More than that actually…
ALEC HOGG: In different roles…
MARIA RAMOS: In different roles, yes.
ALEC HOGG: So it gives you perhaps a unique view of the mosaic of this place and the biggest changes perhaps this year to 10 years ago.
MARIA RAMOS: I think the biggest changes have actually been in the perception of Africa that this has been the first time really where we have been able to place Africa, not just from the perspective of aid and Aids and HIV and the health issues, although those remain very much on the agenda, and they continue to be very important, but we are also able to put Africa on the agenda as a place for investment, as a place for entrepreneurship, as a place where there is a n enormous amount of talent and people have started to notice that. I’ve been in a couple of the Africa sessions – I moderated a session on Tanzania with President Jakaya Mrisho Kikwetethe other day and the people who attended the sessions were CEOs of really large businesses who are invested in Tanzania. The session we did on the growth strategies for Africa, have been about exactly that, so that’s great.
ALEC HOGG: That’s interesting – in the past perhaps the Africa sessions, if they were on the agenda in the first place – might have been attended by ngos whereas this time round, by investors. It was interesting that the session that you moderated on the future of Africa as an investment destination, you stayed completely away from aid and there was quite a lot of focus of attention on opportunities. Sitting in the audience I started thinking, even if I wasn’t an African, that I would certainly be considering this as a destination.
MARIA RAMOS: I did that quite deliberately actually because we need to place our continent on the map precisely as an investment destination, and not because the other issues are not important, not because we don’t have challenges around health, around poverty, around unemployment – of course we do, but so do other parts of the world. And Africa does in multitudes of places in many countries on our continent there are fantastic investment opportunities and more and more those are coming to the fore. We’re building infrastructure – we have unbelievable talent and it’s important for us to begin to put Africa on the global map and agenda with that perspective as well, and this year, have been able to put Africa on the map with that – to shine the light on Africa from that perspective. And of course, this global crisis has also been able to focus everyone’s minds on other parts of the world because this has been a crisis of the developed world, and the developing world and emerging markets have come through it pretty steadily.
ALEC HOGG: Did you think that was the case and remembering – those that don’t recall it – that you were one of the six co-chairs of Davos last year when there was panic and much concern that we might go into a depression. Looking a year on, do you think that the world has done a whole lot better than was anticipated then, or is it just the emerging markets that have done a lot better? Because, clearly, they have.
MARIA RAMOS: I think the world has come through an intense time – the fact that we have averted a recession – we’ve gone through a deep recession but we have averted a depression has been primarily because governments have come to the party with coordinated action. So we’ve come through it a lot better than perhaps we’d anticipated. But that doesn’t necessarily mean that this hasn’t been very painful and that there aren’t a lot of issues still to be resolved globally. I think there are – this is 2010 and it’s going to still be quite a challenging year, and beyond 2010, we are going to see growth in this year and we‘ll see growth going forward, but there are structural issues that we need to contend with.
ALEC HOGG: Are they being addressed?
MARIA RAMOS: I think they are being addressed but we shouldn’t underestimate just how difficult it is to address them, not just in our part of the world, but across the globe. I sat in a session the other day where Juan Somavia who heads the ILO (International Labour Organisation) made the point that if you just look at unemployment across the world – youth unemployment across the world – in the developed countries – youth unemployment in Spain is about 45% to 46% and if you look across Europe in many countries in the European Union the youth unemployment is high. So there are major issues to tackle from the global economies’ point of view – and those can’t be tackled in a year or two – these are big structural issues that as a globe, we’re going to have to work together on.
ALEC HOGG: You said last year, ‘lets not waste a good crisis’. Are we not wasting what has been an intensely difficult period for humanity?
MARIA RAMOS: We aren’t, but what this crisis has done is it has made governments and corporates take a long, hard look at what we’re doing – whether our value systems are right, are we always asking ourselves the tough questions, are we responding to things in a way that allows and is sustainable, are the choices we’re making, choices that will look after the future more than just the present. I think that that’s part of answering the question of how not to waste a good crisis. It’s not just about the next quarter’s profits, it is about sustainability and sustainability is about not just our generation, but about future generations.
ALEC HOGG: Would it be fair comment to say that maybe this year in Davos sustainability has – you can no longer look at it as a fad – but it is in fact going to have to be a way of life.
MARIA RAMOS: Absolutely and that’s been one of the outcomes of this crisis – is that the world has had to take a long, hard look at itself. You know, whether it’s governments, whether it’s the private sector, whether it’s been the NGO sector – just the way we respond to things. The fact that we live in an inter-connected world where crises don’t happen just in one country, but they are transmitted very quickly. The contamination of a crisis is spread – it’s global – it happens in one country and gets transmitted across the globe very quickly and we all have to take collective responsibility for each other’s actions, in many respects. So we’re all in this together, and the solutions need to be collective solutions.
ALEC HOGG: Coming back to Africa itself, one of the other issues that has been very much at the forefront here is, even the laggard countries are either being forced, like Greece, or deciding I suppose not really a laggard, but like Vietnam to get more competitive, to focus on it seems just about everybody wants to go into green energy. Now it’s going to be quite a crowed space and we as South Africans are also talking about green energy as well. But the African continent as a whole has got this undeniable potential, which will be fulfilled perhaps even better, if it became more competitive.
MARIA RAMOS: Yes that’s true and a lot of what we’re beginning to do across the African continent, across many countries on our continent, is precisely investing in technology, in people, in infrastructure designed to become more competitive. You think about some of the big infrastructure investments, whether it’s the Seacom cable, whether it’s the infrastructure in ports, in rail, in infrastructure – all of that is designed to become much more competitive. The investments we need to be making in new technologies on energy for example, all of that has to be focused on us becoming much more competitive, much greener, much more environmentally savvy. We need to think about the opportunities that climate change offers, as well as the challenges that it poses, because there is absolutely no doubt that climate change does pose enormous challenges for our continent. But part of the way to look at the challenge is to say ‘does it also pose opportunities?’ Opportunities to think about new technology, to think about new ways of development that we haven’t had the luxury or the opportunity to think about. Does it allow us to leapfrog into a new way of growing crops, for example, of technology around energy – is there more possibility for wind, or for solar energy – are we exploring that enough, do we need to do more, how do we do it…
ALEC HOGG: Maria Ramos is the group chief executive of Absa.