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Does the world owe South Africa something?

28 February 2012, 08:55

Jim O'Neill,a British economist and chairman of Goldman Sachs Asset Management ,said this about South Africa when we joined BRICS: 
 
  
 
"South Africa should stop thinking that the world owes them something for its past(Apartheid Era)and start doing things to create a better environment for themselves where you can attract a lot more international businesses...most importantly, embrace all your own people in a competitive, open way and find everybody jobs where unemployment in South Africa is still a huge dilemma...Being part of the BRICS political club doesn't guarantee that you are going to be regarded as a BRICS economically."  
 
Would you agree with Jim O'Neill's sentiments? Is that how you feel about South Africa's standing in the world? Is South Africa a Game Changer or Risk Taker in the eyes of the world?Looking at certain things within the country lest see... 
 
  
 
Barron's Accounting Dictionary defines risk taking as "not being fearful of uncertainty and enjoying speculative situations risk taker hates being predictable thinking being such can make them die of boredom. 
 
  
 
A game changer is a visionary. Game changers changes the way something is done, thought about or made. Game changers has new and different ideas that stands out from that which is the normally accepted or the standard. Those who has ideas that completely changes the way a situation develops. A visionary strategist that uses creative innovation to alter their business,job prospects,career opportunities,economics or politics, or conceives an entirely new plan by exploring new ways and different ideas. 
 
Who does modern day South Africa fit into these two descriptions? 
 
  
 
Let's start at the top. Currently South Africa  have a President,Mr Jacob Zuma,who has neither vision nor efficiency according to critics,unlike his predecessors, the iconic and revered public figure,Nelson Mandela and to a point his successor,Thabo Mbeki. Nelson Mandela being the game changer and Mbeki well... 
 
  
 
South Africa under those two former Presidents had very little difficulty getting its own way, using its clout to make bold political initiatives count and taking the leadership role in Africa and beyond. Say what you like and think of Thabo Mbeki,Time magazine rated him once as "one of the world's 100 most influential leaders",the same magazine that also rated Julias Malema as "one of the least influential people ever". 
 
  
 
Mbeki was always the economist,with his adherence to the strictures of neoliberalism that heralded a decade of unprecedented economic growth for South Africa,but sadly left out many South Africans and became obsessed with serving the policies of the self-enriched ANC's ruling elite. It was this behaviour amongst other horrible things that made his downfall so unusual in the end.  
 
 
With South Africa's one year anniversary since becoming part of the BRICS club fast approaching this April 2012,South Africa won't have much that much to celebrate about. Slow economic growth rate of 2.7% as its yearly average,whereas the rest of sub-Saharan Africa grows at 5.75%.

 

You can see why a guy like Goolam Ballim, a chief economist at the South African Standard Bank, is warning that the country was entering "a period of light stagflation" (weak growth coupled with high inflation and unemployment). 
 
 
  
 
Now that South Africa is considered a NIC(Newly Industrialized Country) i.e., has the financial markets, certain aspects of better standards of living normally associated with Western Democracies,a growing middle class and higher salary levels in the public sector,westernized practices regarding regulatory matters and western style law,historically part or associated with certain trade organizations South Africa has been liked with, half of 1% of global GDP,staggering production improvements hopefully forthcoming,major immigration into the country,developed markets,a bit bolder about the basics of good governance,has all that made the country become to preoccupied with which "club" they are in and becauseof this that the world owes South Africa something for its past?  
 
  
 
Finance Minister,Praving Gordhan,spoke of a  300-billion-rand investment program designed to modernize South Africa's fragile infrastructure over the next seven years. Is that too ambitious by these people in power?

 

Just this past January,2012, the Fitch ratings agency had downgraded South Africa's BBB+ economic outlook saying it did so because "its economy can’t create enough jobs".With the country's unemployment rate at 23.9% in 2011,with 62% of the unemployed never have held a job in their whole life before and 68% of the 23.9% that's unemployed had been unemployed for more than 1 year, is this suggesting that the demand-side of the labour market is responsible for a good part of the country's unemployment? 

 

Poorer productive characteristics of black african, coloured, and indian groups relative to the whites people in South Africa was one unfortunate determining issue as to why these groups of people suffered such catastrophically high unemployment rates in South Africa. Upgrading education and skills may not solve the problem, unless there are more jobs in the economy, in other words increase the supply of skilled labour to decreasing the supply of unskilled labour and there is a surplus of workers someone once said.

 

South African leadership under Zuma therefore lacks vision and game changing and sadly South Africa is piling on more disadvantages the longer this government continues the way it does.

 

Something needs to change,but how? South Africa is desperately short on qualified labour.More than  800,000 jobs were offered at one time for engineers and other high-level positions to be filled that aren’t being filled at present. Even though the ANC government spends currently 20% of its budget on education, the funds are often misused by local councils.

 

Welfare Imbalance...

 

On average, the country has for every three social benefit recipients just one taxpayer to try to even things out and corruption,nepotism,theft and fraud are all eating away at the administrative levels. In exchange for bribes, the ANC leaders have made a habit of offering contracts and tenders to so-called "friendly" companies who then overcharge and extort for their services.A vicious cycle indeed.

 

Trevor Manuel once said that South Africa's "entrepreneurial spirit is dead among black people because of Apartheid" and this is further highlighted in that South Africa currently has the world’s lowest small business creation rates.

 

Does the world therefore owe South Africa something for its past? Should a South African citizen have the right to expect that certain basics be provided to him or her, such as health care, housing and a job?

 

Has South Africa done enough standing out from the crowd to be perceived as valuable so as to further market and sell themselves just like you would a particular brand? Does it honestly matter who owes what to whom? Is what you’ll deliver what matters? If we leave our future up to someone else, an employer or our government, we are taking a risk.

 
It’s up to us to develop a skill set that we can market? And if that don't work for us, do we then become savvy and flexible enough to re-tool and just move on?

 

Is there real value in taking personal responsibility by increasing our value and making our self marketable? However there is much more to life than hard work,which when it becomes unbalanced,can rob you of the many joys in life!

 

References:

 

1.Are You a Risk Taker? by Marvin Zuckerman,Psychology Today.

 

2.www.thefreedictionary.com/risk taker.

 

3.Unemployment, race and poverty in South Africa.Source:The Household Survey.

 

4.Kingdon, G. and J. Knight, “Race and the incidence of unemployment in South Africa”.

 

5.Le Monde/Worldcrunch, French Magazine by Sébastien Hervieu.

 

6.Investopedia explains 'Game Changer'.

 

7.Reuters news.

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