By Chris Bishop
It was words from a son and a grandson that set the richest man in South Africa on the road to save the incomes of thousands of South Africans working for cash strapped small and medium-sized businesses across the country. COVID-19, with all its lockdowns and fear, threatens to close scores of these businesses seen as the engine of the economy.
Nicky Oppenheimer, the 75-year-old scion of the billionaire family that made a fortune from mining and diamonds, was one of the first to come up with a billion rand to ease the pain for South African companies in the shadow of COVID-19. In South Africa, money and Oppenheimer are synonymous. His grandfather Ernest Oppenheimer, the son of a German cigar merchant, started out working for a London diamond dealer. Near the end of the 19th century the company posted the then 21-year-old to South Africa where he found his way to the Kimberley diamond diggings and a fortune. His son Harry consolidated the family wealth with De Beers and Anglo American – a pile, according to Forbes, that stands at $7.5 billion. Now a slice of that money will be ploughed back into the South African economy from whence it came.
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“It was actually a word from my grandson, Sam, that said we have been privileged for quite some time as South Africans and in a crisis like this you need to give something back to the country and this idea developed into something, that I am very proud of, to give money in a trust that we will have no interest in so the money we are giving it as a straight donation,” Oppenheimer told CNBC Africa.
The family call it the South Africa Future Trust and it will also give interest free loans to keep jobs, income and small and medium enterprises in business. For many companies across South Africa the 21-day lockdown of the country turned off revenue like a tap. Massive job losses are expected even after all returns to normal in what was already a fragile economy, downgraded to junk by all three ratings agencies, heading for negative growth.
If there was any doubt in Oppenheimer’s mind that help was needed his son, Jonathan, delivered more telling words.
“Well my son has a simile that I think is appropriate here and he says that South Africa’s is like a car that has a puncture and you are pulled over the side of the road and you are stopped. But the car has another problem that is that the battery is not as strong as you would want it, so it is absolutely vital that you should keep the ignition turning while you change the tyre. What the South Africa Future Trust is trying to do is to keep small and medium enterprises alive while the tyre is changed,” says Oppenheimer.
CNBC Africa raised the point that larger companies, employing more people, faced even bigger problems. What about them?
“You are absolutely right, this is a huge problem and we must all do what we can. We certainly hope that many other business people will look at the structures we have put up and know that this is going to be independently managed and independently run and want to contribute to it and extend its reach,” says Oppenheimer.
Oppenheimer once told me about his energetic grandfather that if you bumped into him you bounced off. With a billion rand, he must surely hope to spark a movement to imbue South African small and medium businesses with the same resilience.