According to the Institute of Risk Management South Africa’s (IRMSA) 2019 Risk Report, high levels of unemployment and corruption and unmanageable fraud have been ranked as some of the country’s top risks.
The report, which contains commentary and guidance from 85 experts, aims to create awareness of the risks facing the country, and industry objectives.
“If we compare this year’s risk report to those of previous years, there is an interesting and hopeful shift.
“The impact of fraud and corruption and the failure of the state has shifted down the list,” said Christopher Palm, the chief risk advisor at IRMSA.
“This reflects the ending of the Zuma era – a decade that will be a blight on the nation for some time to come. Last year saw the beginning of a collective resolve to reverse this damage.
“Difficult decisions were made, such as raising VAT, replacing the boards of key state-owned entities, killing off the nuclear deal and tackling the land issue – as an important proxy for income and wealth inequality,” the report said.
Palm said one of the biggest unseen risks in the country was the divide between business, government and civil society.
“While some countries worry about the impact that rich businesspeople have on politics, South Africa suffers more from the opposite problem.
“Industry thinks it can insulate itself from the country and, especially, from government. This must change fast.
“We need all sectors of society focused on rebuilding the country and creating a united front against the national issues holding us back.”
Public Enterprises Minister Pravin Gordhan, who wrote the foreword, said: “We are in the process of rolling back state capture and the risk profession should play their part in finding the answer to the question: ‘Where did the money go that was stolen from the state and how can we recover it?’”
“State capture was not just about a few individuals who decided to conspire with one another to extract benefits from our institutions and state-owned entities.
“It was a far more complex phenomenon as a group of eminent academic researchers conclude in the Betrayal of the Promise report. While corruption is widespread at all levels and is undermining development, state capture is a far greater, systemic threat.
“It is akin to a silent coup and therefore must be understood as a political project that was given a cover of legitimacy by the vision of radical economic transformation.”