There used to be a time we all sat back, being all relaxed about what we offered the world in terms of our mining sector. At some stage in our history, we had been the largest supplier of the three most expensive minerals on earth, being gold, diamonds and platinum.
Our industrial age was also found and developed on mining during the Witwatersrand Gold Rush, which made us one of the wealthiest nations in Africa, and eventually, with more trade and an open economy, we eventually surpassed Egypt to become the largest economy in the 90’s.
Currently, there are five frontline developing nations in the world, being Brazil, China, India, Russia and South Africa.
These are also the member states of BRICS as most people would know, coupled with the fact that all these nations form part of the G20 as well.
Notable to both groups above, being BRICS and the G20, it is evident that SA is well out of its depth in both respects, as we have the smallest economy within BRICS, and as the 27th largest economy in the world, we obviously don’t make the grade as a fully fledged G20 member (which, if you have been living in a hole, is the 20 largest economies in the world).
The only reason we form part in any of these organisations, is due to our regional representation being the most influential country in Africa.
So, why would it be necessary to have someone included in a group, that basically doesn’t belong there, in terms of statistics and numbers, which is of African descent...?
Yes, you guessed it, we are the BEE representative of the world!
Our position in world economics and politics is the product of global affirmative action, and enforced by the United Nations and the G8.
We even managed a place in the Security Council, albeit only for show.
In order for a country to have a sustainable economy, it needs something sustainable to export to the world.
China and India have highly skilled labour. In contrast, a factory technician that builds computer microchips in India or China, comes at the cost of a gardener in South Africa.
So, in terms of value for money labour, strike one against us then...
Brazil has one of the largest and in some sectors, THE largest agricultural industries in the world. We actually import maize from them, because we can sell our own for more in Africa. I know this drives some mielieboere up the wall!
Separate from this, they also rely on a solid mining and textile industry, which again comes at a fraction of the cost we offer semi-skilled labour at.
Russia... well, I suppose the advantage of having been one of the worlds superpowers for years is that you’ll certainly be competitive for decades after your regime change, so it kind of speaks for itself.
I’ve heard far too many people brag on about our stance in the world, and what has been achieved in an economic sense over the past 20 years. Chief amongst these is the statement that “we are the gateway to Africa”.
Great, so we had developed infrastructure and Western promises that made us the prefect for the consumer continent, which is fine, as long as we can sustain it.
What we can't do is sustain mining exports ad infinitum, nor can we expect the world to back us purely because of our resources or regional proximity.
We also need to remember that investment in Africa is a luxury to the world, especially in this economic climate, and that it is purely done to develop long term markets which haven’t been developed yet.
The one true aspect to consider is the fact that we don’t really have too many competitors on this continent to take our place... just yet, but in a couple of years even that may change.
De Beers already moved its primary operations to Botswana due to mining red tape, and had it not been for that fact that our diligent neighbour didn’t have a coastline, we could have faced strong competition from them a long time ago.
It seems the responsibility our government has to safeguard our position is also taken for granted, as they are very quick to forget that we didn’t earn our place, for the reasons as set out above, but found ourselves in this position due to good PR by Mandela’s government, and an infrastructure system second to none in Africa.
I suppose the recent budget allocations in the latter, is a step in the right direction in cementing our place, but again, that only makes us competitive in an African context. We need to start competing against our BRICS counterparts in terms of gorwth.
In terms of our BRICS colleagues, we are the poor nephew that had no future, had he not been employed by his rich uncle.
I guess my point is that we have been given an opportunity out of goodwill, and that we need to use that opportunity to prove that we deserve it.
Currently, we however bully other African countries with it, and behave like spoilt children who don’t want to share their ice cream on the playground.
Don’t get me wrong, I’m not saying that we should take responsibility for Africa, as we have more than enough problems of our own. What I am saying is that our influential position in Africa is dependent on our region’s support, and it seems that we are losing it if the African Union debacle with Mrs. Zuma is considered (then again, who blames them for not wanting to appoint her!?).
In conclusion, I believe that it would be possible for us to reach an economic position where even poor political leadership, such as our current, can have a minimal effect on our economic development. The problem is, we aren’t there yet, even though some might believe we are.
Our single biggest positive is the fact that we don’t meddle too much with economic and fiscal policy, and that the three branches this all is built on, being the Reserve Bank, SARS and National Treasury are some of the last remaining government instances functioning correctly.
If we can make it through the Zuma era, with his highly suspect cabinet, and we have a strong leader to follow, we may just reach the point of ultimate respect. The point where we actually have something to offer the world, something more than the current...hope for Africa.
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