Mpumelelo Mkhabela

SA can't afford to wait for 2019

2017-04-13 09:28

As the ruinous and divisive presidency of Jacob Zuma continues, killing off the fractured ANC and decimating the beleaguered economy, it is also imposing onto the next administration a thankless task.

The administration that will take over the reins in June 2019, whether it’s run by the increasingly buoyant opposition or not, will have no space to breathe. There will be no honeymoon. By that time, Zuma’s ANC faction will have almost completed his multifaceted ruin of our country.

Public finances will be in a mess. It will be back to mid-1990s scenario when the Nelson Mandela administration took over a country that was literally broke because the outgoing government of FW De Klerk had allowed public debt to escalate as investments slowed due to apartheid sanctions.

In his book, A History of Inequality in South Africa: 1652 – 2002, the academic Sampie Terreblanche remarked: “By allowing government’s debt to escalate as sharply as it did, the De Klerk government was guilty of reckless white plundering in the final years of white supremacy.”

Having worked hard, implementing unpopular fiscal policies, the Nelson Mandela and Thabo Mbeki administrations brought the country’s balance sheet to a sound footing. As a result, the government was able to expand the social grant system that Minister Bathabile Dlamini wants to collapse.

Zuma was the beneficiary of sound macro-economic management. He inherited a country with a sound balance sheet. It was slowly rolling back poverty while growing the black middle class. It was due to the policies of his predecessors that Zuma had money to divert to create a bloated Cabinet.

But that fiscal base has dramatically evaporated. Government’s power over its own finances is also in decline. With Zuma at the helm, South Africa will be technically bankrupt by 2019.

If the apartheid government was guilty of reckless white plundering, Zuma is guilty of reckless Gupta plundering. The Guptas, an Indian family that arrived in South Africa in 1993, in time to hijack government and usurp the power of voters, are the primary beneficiaries of Zuma’s rule.

What they have done in South Africa, with Zuma opening the doors for them, would have been impossible in any self-respecting democratic country. They probably think all South Africans are fools led by a fool-in-chief that we call our democratically elected president.

In addition to usurping the power of ordinary voters by buying Zuma, they are waging a fight with some of the most powerful South African business people – from Rupert to Oppenheimer. They have taken up opportunities that should be given to black South Africans in state-owned enterprises.

They are also threatening the financial stability of the country by waging a war on sound banking regulations. And if they aren’t landing their wedding jet on our military airbase, they are secured by military vehicles at their Saxonwold home.

By 2019, South Africa will be indebted to some nuclear power that would have advanced a loan government to build nuclear reactors that will benefit a Gupta-owned uranium mine. The new administration will have the task of fighting to undo the nuclear deal.

The age of austerity will return. Public expenditure cuts will be imposed by the largest creditors. By that time, maybe the creditors will be the much-dreaded International Monetary Fund or World Bank, who knows? Even the emerging Brics Bank will not advance free loans. It too will demand fiscal discipline.

There will be no money for poverty alleviation programmes. More so because, thanks to the credit downgrades caused by Zuma and applauded by ANC figures like Nomvula Mokonyane and Collen Maine, a huge chunk of the budget is already servicing expensive debt.

The little that remains of investor confidence will have deteriorated as the full impact of the credit downgrades will have materialised. Public and private sector companies are already being downgraded, reducing their capacity to expand.

Without new investments and expansion of production, jobs will not be created and there will be no additional tax revenue for the state. Social expenditure will shrink as social needs expand.

It will be hard to convince the poor to wait while the new government fixes the fiscal mess caused by Zuma. They will demand delivery. They will organise service delivery protests. It will be messy.

The state will struggle to perform its basic constitutional duties including safety and security. The government will find it difficult to keep close to a million and a half civil servants on state payroll. Faced with militant unions and political instability, it won’t be easy to retrench. Political tension will rise.

The trust in state institutions will diminish further. The new administration will have to start afresh. Having witnessed the Zuma havoc machinery in full swing, it will be hard to convince citizens to trust state institutions.

Deep political cynicism has been planted among citizens. This cynicism will have to be converted to healthy democratic cynicism so that mistrust is directed at politicians, not state institutions. And it will be at that moment that trust will be crucial to ensure the restoration of the rule of law, respect for state regulations including civic duties such as payment of rates and taxes.

Zuma’s resignation or recall is urgent to minimise the task of the next administration to fix the mess he has caused. The longer he stays, the more difficult it will be to rebuild. 

- Mpumelelo Mkhabela is a fellow at the Centre for the Study of Governance Innovation (GovInn) at the University of Pretoria.

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Read more on:    jacob zuma  |  anc

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