Emerging markets: strategic theme of the 2017 Nation Brand Forum

Brand South Africa chief executive officer, Dr Kingsley Makhubela talks to Nastassia Arendse on MoneyWeb about the 2017 Nation Brand Forum where emerging markets are set to take centre stage during the discussions. The forum is about sharing ‘ideas on how to strengthen our competitiveness around the world’, Makhubela explained.

“The Fourth Industrial Revolution will have serious ramifications with respect to developing countries, particularly countries like South Africa, where unemployment is so high,” said Dr Kingsley Makhubela, chief executive officer of Brand South Africa. (Image: Mathiba Molefe)

Listen to Dr Kingsley Makhubela and Nastassia discuss the 2017 Nation Brand Forum and the role that emerging markets are to play in strengthening South Africa’s global competitiveness:

NASTASSIA ARENDSE:  The Nation Brand Forum is a strategic Brand South Africa platform through which the organisation endeavours to create an open space for engagement with stakeholders in government, business and civil society. I had a conversation with Dr Kingsley Makhubela, the CEO of Brand SA, about the strategic objectives of the Nation Brand Forum.

DR KINGSLEY MAKHUBELA:  Well, the Nation Brand Forum is not a lobbyist side, but it’s a forum that brings together business and the private sector, people who are essentially involved in the value creation of this country, people who are building good brands in the country. The idea here is to share views around the performance of the nation brand. It has elements of also bringing the politicians to look at the concerns from the non-governmental sector. What are people concerned about – things that are enhancing or things that are affecting the nation brand? That is essentially the purpose, to share ideas on how to strengthen our competitiveness around the world, and our cooperation with like-minded countries.

NASTASSIA ARENDSE:  If you had to describe the term “nation brand” to someone who is hearing it for the first time, listening to this interview, what would you say the nation brand is?

DR KINGSLEY MAKHUBELA:  Well, the nation brand essentially is a totality of government, private sector and non-governmental sector. That’s how wide segment this. And you can further segment it. The three pillars are essentially involved in building the nation brand.

The private sector is essential because the economy of this country and jobs are created by the private sector. The governmental sector is involved in creating regulation, and that’s where the private sector is concerned about regulatory framework that is conducive for conducting business.

The non-governmental sector is our behaviour, how we behave and how we are perceived. For instance, take an entity like Gift of the Givers – they showcase the best that we possess as a nation. So you look at those issues.

But there are other serious segments. There are a lot of theories around this. You can look at tourism, you can look at business, you can look at those, but all of them are created by these three pillars that we will always try to place emphasis on.

NASTASSIA ARENDSE:  It’s a very interesting theme: “Inspiring Innovation and Business Excellence in the Era of Emerging Markets.” Talk to me about this theme. Why this particular one?

DR KINGSLEY MAKHUBELA:  Two years ago at the World Economic Forum the discussions were around the Fourth Industrial Revolution. During the course of this year at World Economic Forum Africa it was actually implementing decisions around the Fourth Industrial Revolution. The Fourth Industrial Revolution is driven by innovation and new ideas. That’s why we chose this.

But we are looking at emerging markets. Emerging markets are going to be the drivers of global growth because they are growing from a very low base as opposed to well-established markets. So the elasticity of growth within the emerging market is so huge. And that’s why we thought we should focus on that.

There are a lot of commonalities between us and the rest of the emerging markets, and everybody is actually clamouring for emerging markets. And in the continent the growth of the middle class is exponential, it’s growing at a pace that we can’t imagine. Everybody is looking at capturing this market, and that’s why we thought there should be this focus.

NASTASSIA ARENDSE:  There is so much happening around the world when you look at aspects in the geopolitical side of things, or whether it’s the economic fundamentals. To what extent, when you look at what’s happening in the global background, taking everything into account, does it either enhance or impede South Africa when it comes to global trade, when it comes to investments, etc?

DR KINGSLEY MAKHUBELA:  At Brand South Africa we do analysis of global trends every year, and we look at new emerging issues, be they conflict areas, be they the challenges in the Korean Peninsula, the developments in the Middle East, the collapse and the failure of states. They all have an impact in terms of the nation brand. When Brexit happens it has serious ramifications for developing countries, not only our own nation brand but across the world.

We try to do analysis to see how we can compete and cooperate with some like-minded countries that are facing similar challenges or have similar interests. So we do detailed analysis of those issues because they can enhance or they can impede the growth of the nation brand, or competition and collaboration with other nation states.

For instance, if the world is quite concerned and preoccupied with a particular issue, it becomes very difficult to introduce things that may be pertinent to building our own nation brand. So you need to be really aware about the internal dynamics because they keep shifting. Earlier on today we were talking about this attack in the US, which is going to preoccupy a lot of people to change the manner in which people access public areas and so on. The hotel rules are going to change; the Americans are going to make strict security checks around this place. So we would essentially be surrounded by security.

So they have a direct impact in terms of how to build a nation brand, how to build a nation where people are happy and are able to move around without any fear. But fear is part of our lives recently.

NASTASSIA ARENDSE:  From your perspective, how is South Africa doing when it comes to marketing and positioning itself in the continent, in Asia, in Europe, etc?

DR KINGSLEY MAKHUBELA:  We are doing well, but I think we could do better than this. The challenge in the continent is that our business – we’ve done research in some key countries around the challenges of South African business having a foothold in these areas, and we found cultural issues in that our businesses don’t really invest a lot in understanding the cultural behaviours in this country and understanding consumption patterns in that country. They want to put products in the country without understanding the underlying concerns in the particular country. That’s our biggest problem. We’ve been sharing some of our findings with organised business groups within the country.

In Asia, again, I don’t think we are investing a lot as South Africans to try and understand the dynamics that are driving particular interests on different continents. China remains one big enigma that we are grappling with, trying to understand the interest and the direction at which we are moving, and we need to constantly do analysis and understand the trends that are emerging in those countries.

I think we haven’t invested as South African business, we haven’t invested a lot in terms of analysis and understanding the underlying issues so as to really leverage on the opportunities that may arise out of those countries.

NASTASSIA ARENDSE:  You were talking earlier about the Fourth Industrial Revolution and, as you speak, I’m thinking of these opportunities you speak of. You read a lot of articles about how Africa is poised for growth, Africa is in a position to take advantage of the Fourth Industrial Revolution. When you look at South Africa, are we ready for the Fourth Industrial Revolution or do we still have some things that we need to fix – i.e. growth? We need to push that up to levels where investment can come in, etc.

DR KINGSLEY MAKHUBELA:  The digital economy now is fundamental in driving the Fourth Industrial Revolution. The Fourth Industrial Revolution will have serious ramifications with respect to developing countries, particularly countries like South Africa, where unemployment is so high. Remember, the Fourth Industrial Revolution is going to produce its robots in terms of performing functions that could have been manually performed by ordinary people, and particularly in countries where we have a very low skills-base level it’s going to be a challenge.

It’s not only we in the continent that are going to have that problem. That’s why at Davos last year the discussions were around how to leapfrog the African continent. And one area that has made significant progress is the area of health, because the health ministry has agreed in terms of specific deliverables to leapfrog health-related issues. And of course because health-related issues have no borders, that’s why the developing countries are quite concerned about these issues. If you have an Ebola outbreak here in the continent, you end up having patients in the United States, the United Kingdom. It spreads. And that’s why you see countries of the north are quite concerned to address those issues, maybe because they have a selfish interest in dealing with that. But we equally have an interest in terms of resolving such issues.

NASTASSIA ARENDSE:  What do you hope people walk away with at the end of the Nation Brand Forum?

DR KINGSLEY MAKHUBELA:  A common approach to projecting ourselves as a nation brand has been the tendency for all of us to move from different angles and, in most instances, contradict each other and shoot each other in the foot. I think here we have our own challenges as a country. What we want the Nation Brand Forum to focus around are the key deliverables that we can focus on, and project the country outside to attract a lot of investment and a lot of interaction, making the country desirable.

NASTASSIA ARENDSE:  Dr Makhubela, thanks so much for your time.
