Let's Think

Time to concentrate on post-Zuma era and go back to basics

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It is not just negative news that is coming out of South Africa, but to save its future it needs to come back to basics, to a balanced approach. Special interest groups also need to get off their high horses.

Probably the most damaging effect of the present dominance of the South African national household by the shadows thrown over it by the shaky figure of President Jacob Zuma, is that the positives, the potential and the things to be proud of get totally lost. As a nation we are losing focus of what we can be when Zuma and his cronies vacate the scene.

And vacate the scene, they will. It was in the cards dealt by the August local government elections and the ANC’s internal fracturing that followed. If Zuma – and it is a big ‘if’ – survives next year’s ANC national conference, the longest he will around in the presidency is 2019, when his second term – all that is allowed by the constitution – expires.

What was also in the cards dealt by the electorate in August with the loss of power by the ANC in larger and smaller municipalities with coalition governments appearing in its wake, is that the days of absolute ANC dominance are over; a new era of political coalitions has finally dawned as facilitated by the Constitution; and democracy is alive and well in the country.

The fact that Mr Zuma embarrassed himself, his party and his government by, last week in parliament, not even being able to remember the nine key points of the National Development Plan, is not just indicative how far the welfare of the country’s economy is from his mind, but also to what extent he is losing touch with reality. For the ANC the Zuma embarrassment is just growing.

Some good news

There are many grounds for concern, from the battle surrounding Finance Minister Pravin Gordhan, to the problems at state-controlled enterprises, to evidence seeming to indicate corruption even at high levels in the South African Revenue Service. But there is also good news. The mere fact that these problems come to the fore, indicates that the protective institutional construct is not dead yet.

The exposure in parliament of the ineptness of Lieutenant-General Mthandazo Ntlemeza, the leader of the pack in the onslaught against Minister Gordhan is more good news. The fact that ANC members of the Standing Committee on Public Accounts (Scopa) led the taking to task of the Hawks boss, illustrates that a fightback against corruption is also developing within the ANC.

An Exit-Zuma plan just might be closer at hand than is generally anticipated. The survival instinct of many ANC politicians might finally be kicking in.

But despite all the political strains and uncertainties in the economy, all of which are not of domestic origin, and concerns about a possible sovereign credit downgrade, which has become, with a threatening recession, one prominent bogeymen on the domestic scene, there were also positive signs on that front.

As Dave Mohr, chief strategist at Old Mutual Multi-Manager, recently remarked: “We have managed to avoid a full-scale recession despite the collapse in commodity prices, tighter monetary policy, the worst drought in living memory, a hostile international environment and all this political and policy uncertainty. We will still be here when all this turmoil blows over.”

He also noted that South Africa also boasts Africa’s best transport links and energy supply, and a financial system that the Geneva-based World Economic Forum ranks among the world’s best. Accounting firm EY ranked the country Africa’s most attractive foreign direct investment destination last year, and government debt levels and the budget deficit are well within the limits recommended by the Paris-based Organisation for Economic Co-operation and Development.

Despite all the political and global market turmoil, the latest statistics showed that the country’s current account deficit narrowed more than expected in the second quarter and, in the words of Minister Gordhan, is not in “recession territory”, after a surprising economic growth of 3.3% in the second quarter of the private sector. It is not only the government sector, but also the so-called free market, that keep many South Africans trapped in poverty and fuel dangerous levels of inequality.

This is probably best illustrated by a recent study by the United Kingdom-based Oxfam. Looking at maize farming in Southern Africa, it concludes that especially small-scale farmers “… are frequently ill-served by their governments and by markets (our emphasis) and that “poor households, who sell the least maize and purchase the most, must sell low and buy high – the essence of a poverty trap”.

In a recent article on The Conversation website professor Steven Friedman of the University of Johannesburg makes a solid case for a change of attitude among business leaders – they need a greater sense of crisis.

Accusing them of playing a blame, he writes: “While some business leadership does see the need for government to fight poverty, the dominant view sees government and labour as the problem. This view sees the market as the only solution.

“In their eyes economic exclusion is the fault of a government and unionists who are ideologically blind, greedy and incompetent. And it will end when government and labour get out of the way and allow the efficient and inclusive market to take over.”

But, as the Oxfam study above proves, it is a myth that the free market always functions perfectly to the benefit of everyone in society. It is in effect often the driver of perpetual and dangerous levels of inequity.

We think

South Africa is indeed experiencing a socio-economic crisis. It is, however, also an opportunity to reset priorities and strategies. It is a crisis that should not be wasted, as South Africa has clearly entered a second transition to a more complete democratic transition.

Hopefully leaders in all formations of society will step forward, get off their ideological high horses and get going towards arriving at a new truly inclusive national vision and development plan.

by Piet Coetzer

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