SA’s poor global performance

2007-12-11 00:00

The former UN Secretary General, Kofi Annan, once remarked that globalisation is a fact of life, and that we often underestimate its frailty. Although he may have been referring to its failure to reach out to people caught up in natural disasters, the concept is usually aligned with the dominant model of capitalism that exists in our world today, namely neo-liberal market economics. This model, which has attracted much debate and caused violent anti-globalisation demonstrations around the world, espouses free market thinking. It is an emotive topic, drawing support from right-wing think-tanks such as the United States-based Cato Institute and The Heritage Foundation.

Stacked against these views is an army of anti-globalisation campaigners such as Naomi Klein. In her latest book, The Shock Doctrine. The Rise of Disaster Capitalism (Allen Lane, 2007), Klein berates the late Milton Friedman, one of the 20th century’s most influential economists and free-market crusaders. Friedman developed an economic model that has been partially implemented under democracy, but which many of his critics have argued requires authoritarian conditions for its real vision to be attained. What has emerged over the past three decades, laments Klein, “is a powerful ruling alliance between a few very large corporations and a class of mostly wealthy politicians”.

Like it or not, the globalisation clock will unlikely be turned back in the foreseeable future. Globalisation affects just about everything that happens inside an economy and countries that do not manage the dynamics of strategic manoeuvring to cope with this economic juggernaut run the risk of doing untold damage to their economies and therefore the welfare of their people. A number of indices have emerged over the last two decades to measure a country’s performance in the global economy. One of the more meaningful is the globalisation index, jointly published by the influential Foreign Policy magazine and international management consultants A. T. Kearney. This index measures the extent to which countries are integrated into the global economy. The 2007 rankings assessed 72 countries, accounting for 97% of the world’s gross domestic product and 88% of the world’s population. Twelve variables grouped into the four clusters of economic integration, personal contact, technological connectivity and political engagement were employed. Overall, South Africa is ranked 59th, a drop of 10 places since 2006 and just ahead of Kenya, Tanzania and Russia. Singapore, Hong Kong, The Netherlands, Switzerland and Ireland make up the top five rankings, with Singapore hitting the top spot for the fourth time in seven years as the world’s most globalised country.

South Africa’s dismal performance once again highlights just how ill prepared our country is to cope with and manage globalisation. Instead of satisfying its own ego by (for example) hosting the 2010 Fifa World Cup and chasing political aspirations far beyond its current position in the world, it is high time that our government displays a modicum of responsibility for national development. It could start by creating the right kind of domestic environment, to ensure that all sectors of our country will be able to manage and benefit from globalisation. No one wants to see a South African version of disaster capitalism.

• Paul Dorrian is a management consultant, author and teacher, specialising in marketing, strategy and customer service. His latest book Dancing With The Customer. 101 Lessons Towards Service Supremacy (Umuzi 2007) was released in July.

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