As the country's leadership transitions, so too must the economic modalities under which South Africa has operated. Much like the country cannot continue under Jacob Zuma, its economy cannot continue to ignore the majority of its stakeholders. Fikile-Ntsikelelo Moya argues a change is essential for the country's economic and political stability.
Of the many ills they have committed against South Africa, one of the worst committed by the nefarious Gupta brothers was to dilute the idea that there existed an economic apartheid in South Africa.
It is because of the association to the Guptas that the likes of Nkosazana Dlamini-Zuma, who argued that South Africa needed an economic Codesa, have not had a fair hearing. Accordingly, their links to the scandalous family have been exaggerated. By using the phrase coined for the country by the now disgraced British PR firm Bell Pottinger, “radical economic transformation”, Dlamini-Zuma and those who supported her inadvertently placed themselves in the same grouping as the Guptas who hired the firm.
Yet, whether one likes Dlamini-Zuma, Bell Pottinger or the Guptas, none can seriously ever argue that South Africa does not need radical economic transformation. You can choose any name or phrase you like, but it is inescapable that as the gulf between rich and poor, blacks and whites grows, the economy cannot continue working as it has up to now.
As Dlamini-Zuma said in an article published in the Business Day last October, “we cannot continue to tinker at the margins of the economy without fundamental transformation to ensure growth, development and redistribution. This requires that we prioritise an entrepreneurial industrial policy and plan, by adding value and beneficiating mineral resources.”
This is hardly some hard line, outdated Soviet era socialist rhetoric as some of her opponents sought to suggest. It is common sense. Furthermore, Dlamini-Zuma’s proposal is, at least on the surface, not too different to that of her rival and now party president Cyril Ramaphosa. The “New Deal” also recognises the need for government, labour, business and civil society to work together in realising the future South Africa desperately cries out for.
Where Ramaphosa probably differed with the former African Union chairperson was linking economic revival to throttling state capture. “No meaningful growth, transformation or development will be possible for as long as key public institutions continue to be used for the criminal benefit of a few and public resources continue to be looted,” said Ramaphosa.
With many in the NDZ campaign having been or perceived to have been beneficiaries of state capture, Ramaphosa’s words rang like a warning bell that their wealth and business case might be in danger. But whatever the differences between those who supported Nkosazana-Zuma or Ramaphosa might have been, the stark reality is that South Africa needs a serious shake up of the economic system to benefit the majority who are black.
This is not a nationalist viewpoint
According to data released by Stats SA last August, poverty is on the rise in South Africa. The “Poverty Trends in South Africa” report showed that, “despite the general decline in poverty between 2006 and 2011, poverty levels in South Africa rose in 2015”.
“More than half of South Africans were poor in 2015, with the poverty headcount increasing to 55,5% from a series low of 53,2% in 2011. The figures are calculated using the upper-bound poverty line (UBPL) of R992 per person per month in 2015 prices. This translates into over 30,4 million South Africans living in poverty in 2015.”
Add to these numbers the feeling among many unemployed; the small, township and rural business people who have lost a market to immigrant retailers and the proliferation of big shopping centres, and you have yourself the making of an economically unhappy nation.
Things are not exactly great for big black business listed on the JSE. The figures are disputed, ranging from three to 23% depending on who is talking and the methodology they employ. According to the National Treasury, black ownership of the JSE (Alternative Prosperity) is at a paltry 10%. Black ownership through institutional funds is at 13%.
Under these circumstances, it is not hard to see why for those who are poor and emerging, anyone who talks economic emancipation will have a receptive ear ahead of those who seem to want to discipline a section of the elites who have gone rogue. This should not be read as a justification for corruption, nor as a call to pretend that it does not matter. It does.
Corruption erodes the state’s capacity to address the very basis for poverty, which is poor education and systematic exclusion of the majority from economic opportunities in favour of a few, politically connected.
To reiterate what US campaign strategist James Carville said in his quest to get Bill Clinton to defeat George Bush, “it’s the economy, stupid”.
It is the feeling of being and feeling left out of the economy long before the Guptas arrived here and seeing no prospects of anything changing even after they leave or are chased away that keeps those arguing for radical economic transformation – even if they mean lining their own pockets – in the game.
It is hardly surprising that the marginalised might not feel they are being stolen from when they have never felt the benefits of the economy. There should be no argument that all those involved in state capture should be prosecuted, if convicted jailed and the proceeds of their ill-gotten wealth forfeited to the state. But that is just one half of the story.
The other half is that there are many who are losing patience waiting for the economic dividend of Mandela Freedom. The elephant in the room is black exclusion from the economy. It would be useful for anyone who succeeds Jacob Zuma to keep that in mind.
To dwell on the phrase “radical economic transformation” instead of unpacking what it means for South Africa’s future, stability and political risk, would be to throw the baby out with the bathwater.