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'Apartheid Economy Remains Largely Untransformed'

"The lack of transformation is reflected in the structure of the South African economy."

02/12/2017 11:33 SAST | Updated 02/12/2017 11:45 SAST
Denis Balibouse / Reuters

Any discussion about building a South Africa that belongs to all and therefore about transforming the South African economy must acknowledge that South Africa, with a Gini coefficient ranging from 0.66 to 0.69, is one of the most unequal societies in the world. The Gini coefficient measures income inequality in a range from 0 to 1 where a totally unequal society will score a 1.

In the world's most equal societies, the top 10% earn about six (6) times as much as the bottom 10%. In South Africa, the top 10% earn 110 times more that the bottom 10%. South Africa also operates in a global economy where 75% of cities across the world became more unequal over the past two decades, according to the United Nations Habitat World Cities Report 2016.[1] Increased inequality is therefore not a uniquely South African phenomenon.

However, there are some uniquely South African causal factors, including the legacy of the well-oiled exclusion machinery of apartheid, consisting of the tight framework of laws and spatial planning that permeated and stifled every aspect of the lives of black people in general and Africans in particular with the most adverse effects on African women. This fact made the erstwhile South African colonial project a 'colonialism of a special type'.

The dawn of democracy made it possible for the ANC government to repeal apartheid laws, and to introduce measures to progressively address many of the social consequences of apartheid. Sadly, the overall structure of the economy that had been put in place under apartheid has remain largely untransformed. Consequently, whilst the introduction of a social wage (housing, education and health care, water and sanitation, social grants) for the poor, towards improving the lives of many, the lack of economic transformation and redistribution meant the continuation of the deep seated and structural inequalities, based on race, gender and geography.

This lack of transformation is reflected in the structure of the South African economy, in a world where production value chains have become global, where Africa is working to claw out its own space, and where some are moving towards the fourth industrial revolution.

South Africa must therefore take concerted measures to tackle the deeply ingrained domestic fault lines, the increasing chasm between the rich and poor, and define its space within the African and global economy. The divide between rich and poor, if left unattended, will be to the detriment of all of society, as the poor and marginalised cannot continue to occupy the fort of patience.

Consequently, the Radical Economic Transformation agenda is to the benefit of all South Africans. It is an agenda directed at the large army of unemployed and poor South Africa, to build an economy and society that include everyone, as a precondition for stability.

This is why the African National Congress has made a concerted effort to focus on Radical Economic Transformation. This will provide a fundamental change in the structure, systems, institutions and patterns of ownership, management and control of the economy in favour of all South Africans, especially the poor --- the majority of whom are young, African and female. Such a path will secure a developmental state which places people at its centre without leaving anyone behind. Inclusivity is at the centre of our approach.

The focus on radical economic transformation, changing the structure, systems, institutions and patterns of ownership, management and control of the economy to include all South Africa, is fundamental to building the society envisaged in our Constitution. It must therefore address (amongst others):

- A targeted intervention in our education and training system: making sure that every single school have the basic norms and standards to enable learning, investments in teacher and curriculum development; strengthening science, technology, engineering and mathematics; and free and quality education accompanied by a skills revolution, where school-leavers and the young unemployed have the competencies and skills to contribute to society and their community as citizens, take up and help create old and new job opportunities. All of which should be underpinned by patriotic learners who know their history, and with a Pan African and global perspective.

- Resolving the historical injustice of land dispossession, so that all South Africans have access to land for housing, businesses, and other social infrastructure, as well as the growth of agriculture and agro-processing. South Africa, together with other countries in the region should aim to become a player in the continental and global food markets, including playing a significant role in reducing the over 70 billion USD bill we spent on importing processed food into the African continent.

- Placing growth, job creation and industrialization at the centre of our macro economic policies, and the mandate of the developmental state, state owned entities, and the partnership between government, business and labour.

- Having an overall green (environmentally sensitive) approach, with a strong emphasis on unlocking the blue economy, as a part of our job creation strategy. Our continental shelf as a source of food, tourism and marine manufacturing is badly underdeveloped and holds huge potential for growth and especially job creation.

- There must be value chain optimisation. For trade to succeed the whole value chain has to be integrated seamlessly. It starts with raw materials, production, processing, transportation, storage and sales. Our government, together with other African governments and the private sector, have to cooperate to improve infrastructure on our continent. The current situation where it is more expensive to transport goods from South Africa to Zambia, than to the United Kingdom cannot be allowed to continue.

- The role of women in the professions and management and easing their access into mainstream industries should be prioritised. Our society is still very sexist and patriarchal and women very quickly hit a glass ceiling in most industries. We must empower women in every respect.

Our overall focus on growth with redistribution also means a review of current models of black economic empowerment, ensuring that it not only empowers individuals, but also communities and employees, as well as a determination on the 'once empowered, always empowered' principle to be in line with our goal of fundamentally changing ownership patterns.

For South Africa to truly belongs to all – black and white, women and men, young and old – we must work to make it possible for everyone to be part of the economy and to benefit equitably on a playing field that is truly level. The developmental state in South Africa should make use of all its available resources to do so.

To unite South Africa around this mission requires a united and vibrant African National Congress, with the integrity, capacity, determination and capabilities to lead society. The African National Congress as the movement which is most trusted by the people of South Africa has a historic and current obligation to ensure that on this journey of transforming our economy, no-one is left behind.

*Dr. Dlamini Zuma is the former Chair of the African Union Commission (AUC), and former Minister of Health, Home Affairs and Foreign Affairs. She is a Member of Parliament and a member of the NEC of the African National Congress (ANC), as well as a member of the NEC of the ANC Women's League (ANCWL)

[1] Hermien Kotzé, in Factsheet : Inequality in South African Cities, in www.africacheck.org, 9 May 2017