How to rebuild South Africa

2017-10-01 06:02

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I have previously argued that the high turnover of development strategies and policies since our transition to a democracy is primarily responsible for the uncertainty prevailing in the country.

This has contributed to low levels of sustained domestic and foreign investment in South Africa – the investment required to create factories and jobs that we so desperately need to fight poverty and inequality.

Another contributing factor has been the high level of mistrust characterising the relationship between government and business. This is understandable, given the support that business provided to the former apartheid regime despite its global pariah status.

The reality, though, is that the negotiated settlement that spawned our democratic transition required high levels of cooperation between all the social partners, especially business and government, to achieve the society so carefully articulated in our Constitution. It was a tough call, given our apartheid context and the dominant paradigms that had come to define our social interactions.

When the ANC assumed political power in 1994, it had limited policy options to immediately confront the apartheid legacy of racialised wealth, income inequality, poverty and unemployment. But it was compelled by a sense of moral obligation and social justice, along with a desperate urgency, to implement poverty alleviation measures targeted at assisting the old and the vulnerable, especially in black communities.

The social welfare framework and its supporting budgets have gone some way towards lifting many out of the poverty trap, and are a wise response to the structurally defective legacy of apartheid.

Added to these unprecedented challenges were the empty coffers that the ANC inherited from a highly indebted apartheid state. This further limited its options in finding an effective response. It was clear that a new approach was required to deliver the desired developmental outcomes.

The concept of a developmental state that was properly structured, well resourced and efficient found immediate concurrence and was punted as the answer to the enormous socioeconomic challenges confronting our new democratic state.

The key drivers in many successful east Asian developmental states have been efficient planning and execution by a highly competent technocratic state machinery.

Space constraints do not allow me to make a comparative analysis of why certain countries succeeded at establishing efficient developmental state machineries, while others failed. Rather, I will explore why our attempt to establish a much-needed developmental state machinery failed, and what can be done now to get it back on course.

One of the most critical success drivers and requirements for a developmental state is the creation of new economic structures, such as the National Planning Commission (NPC) in the case of South Africa. These structures are given the necessary political mandate and legislative powers to manage national economic planning and the effective coordination and integration of development policies – be they fiscal, monetary or social – across government.

Given the vital role they play, such structures must be populated by highly competent and experienced professionals across the socioeconomic spectrum.

Development imperatives

In the case of South Africa, the primary task of this planning commission would be to relaunch the National Development Plan (NDP), ensure its adoption by a broad spectrum of society, identify critical landmarks for its success and manage its implementation and coordination across all departments and sectors.

In this new role, the NPC would be the ideal structure to bridge the current mistrust that has become entrenched and nurture a new basis for cooperation, isolated from political interference.

This concept of a developmental state has been applied quite liberally by many politicians in the past few years to motivate their supporters and inspire them with renewed hope. Yet they have failed to pay attention to the requirement of competence that is so critical to its success.

Instead, the opposite – cadre deployment – has been allowed to dominate appointments in all critical positions in the state machinery. It is this tendency that has rendered a fatal blow to all efforts to progressively grow an effective developmental state.

Given our extraordinary challenges, our development imperatives can be summarised in line with the main themes represented in the NDP: to grow an attractive investment climate for domestic and foreign investment to facilitate the creation of factories and jobs; to establish a capable state machinery to deliver services and execute development plans efficiently; and to build capacity to provide quality education for all.

These mutually reinforcing themes, properly coordinated and executed, should have put us on a sustainable growth trajectory that could have created opportunities for all and made a huge difference to the upliftment of the country’s poor majority.

Our socioeconomic challenges provided the new democratic government with a trigger for rapid transformation.

However, the question we need to ask is whether the ANC and its tripartite alliance were ready to take up the challenge of governing or whether, as part of a classical Fanonian weakness, their attention was focused primarily on occupying the seats of power and controlling the largesse that comes with this position.

My considered impression is that the first two ANC administrations were overwhelmed by the size and complexity of the challenges they had to deal with – although, to their credit, they achieved credible economic growth, despite the fact that such growth failed to bring unemployment below the stubborn level of 20%.

The governing party and its allies also undertook comprehensive studies to understand the nature of the constraints to inclusive growth, and what could be done about it.

They achieved limited success in building an efficient and effective state machinery to underpin the effective execution of development plans and delivery of social services, as envisaged in the Constitution. They had, however, taken tentative steps to put in place key elements of an effective developmental state.

From 2009, under the current administration, the situation took a decisive turn for the worse as more attention and effort was directed towards building a patrimonial state, intended to serve the interests of the well-connected political elite and its crony capitalist clique.

Recent evidence that has exposed the existence of a parallel state and massive looting in certain state-owned enterprises point to the spectacular success of this treacherous strategy.

Clearly, the current leadership has failed its citizens at the level of the political economy. The ANC is wholly to blame for this collapse in governance as it wilfully abandoned its oversight role on its president, who is now beyond control and has succeeded at undermining all the critical state institutions required to build a capable developmental state.

What, then, is the future outlook?

There is now incontestable evidence that the competing factions within the ANC are so deeply, and even violently, antagonistic that it is difficult to imagine them coexisting in one organisation. I therefore foresee an unavoidable split in the ANC just prior to, or immediately after, the December elective conference, despite current emotional calls for unity.

It is highly probable that a coalition pact may be formed between the new party that may be led by Deputy President Cyril Ramaphosa and the DA. This may bring about the necessary stability and foundation to reignite the creation of a capable developmental state needed for our economic recovery.

Matsohi is an organisational strategist at Lenomo Strategic Advisory


Are there additional reasons for the governing party’s limited success in achieving inclusive growth?

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