Let my people Agoa: Kirsh

Markets
His financial stature is colossal but, at 83, Natie Kirsh is small and slight.

JOHANNESBURG – His financial stature is colossal but, at 83, Natie Kirsh is small and slight.

His accent is distinctly South African, despite the fact that he is widely billed as the richest Swazi businessman – second only in terms of wealth to King Mswati III — and despite his years of living in the US and London.

In his office in Johannesburg, the only obvious indications of Kirsh’s vast wealth are the eye-wateringly valuable paintings and drawings adorning the walls.

Kirsh is rumoured to be blunt, difficult and demanding. It is these traits, arguably, that helped make him one of the wealthiest men in the world.

Kirsh made his first real money in Swaziland when, in 1958, he founded a corn milling and malt business. His attachment to the tiny country was such that he chaired the Swaziland Electricity Board for more than two decades.

He still loves Swaziland, he says, but it’s clear his attachment is purely emotional: “My total turnover from (my) Swaziland (businesses)equals two days’ (turnover from my businesses) in America,” he says.

Kirsh spread his interests in the ‘60s to South Africa and began to dominate the retail and wholesale space through his holding company Tradegro, which owned Checkers, Metro Cash&Carry, Dions, Russells and JD Group.

He then made perhaps his only business blunder.

In the early ’80s, he partnered with Sanlam in Tradegro. Then the state president, PW Botha, delivered his Rubicon speech, and the South African economy fell off a cliff.

International credit lines to South Africa were cut amid the chaos, just as Kirsh needed financing to fund a serious restructuring programme.

Instead of coming to the party, the chairman and the chief executive officer of Sanlam, Fred du Plessis and Marinus Daling, discovered a lacuna in the shareholders’ agreement that allowed them to refuse to get involved.

Faced with a big, expensive and protracted court case in a politically dubious country, Kirsh threw in the towel in 1986.

He went to the US, where he started up Jetro, that country’s biggest wholesale cash and carry company, which now has more than 81 stores nationwide.

The company is colossal, but then so is Kirsh’s appetite for making deals and buying companies.

Kirsh likes property, too, and snapped up a few high-rises in London. In 2011, he sold out of property developer Minerva, netting himself a cool £50 million.

To get a sense of the returns, he had bought 29% of Minerva for 15 pence a share at the height of the global crisis in 2008, before selling out three years later for 120.5 pence a share.

But Swaziland is clearly Kirsh’s real love, and he often refers to the country as his “fourth child”.

He has set up major philanthropic programmes to kick off small businesses and put IT equipment into “every high school in Swaziland”.

The whole of Africa needs help, he says, but “Swaziland is small enough for me to make a difference”.

Which is partly why he is so furious right now about the extent to which Swazi business is suffering from the US’s decision to boot Swaziland out of the African Growth and Opportunity Act from January.

The US did this with “no care for the man in the street or the worker in the factory”, Kirsh fumes.

The preferential trade agreement, which was implemented in 2001, allows eligible sub-Saharan countries to send certain manufactured goods to the US duty-fee. The idea was to kick-start export-led growth and economic development in these countries.

It was a bigger boon because the trade agreement was nonreciprocal, so imports from the US continued to generate much-needed income duties.

It wasn’t just about getting African economies off the ground, though — it was also a carrot for these countries to institute democracy, the rule of law and political “pluralism”, among other things.

The elimination of a few child labour practices was also a prerequisite.

The US decision is seen as a bid to whip Mswati’s “oppressive” leadership into line. But Kirsh says it’s had little effect on the king — and a far more devastating impact on the everyday Swazi.

“Up to 30 000 formal sector jobs will be lost” as the effects of the withdrawal kick in, he says.

Since Swaziland’s population is only about 1,3 million, this is the equivalent of many millions of jobs in the US, he says.

Kirsch has been lobbying fiercely to reverse this decision — and although it’s rare that he doesn’t get his way, his efforts to exert his considerable influence have proved fruitless so far. – BD Live