HAS BEEN MADE
of the President’s supposed policy shift to the left, particularly
because of the emphasis on the role of the state in development.
But do the President’s recent statements really denote such
a shift? Or do these perhaps signal a different emphasis, rather
than a change in policy direction? Given President Mbeki’s
renewed emphasis on service delivery, targets and performance
management (of all spheres of government and of politicians and
officials alike), is it not more likely that the President intends
to continue on the path embarked on, but with greater vigour,
a sense of impatience perhaps, and more attention for local delivery?
It seems the President has lost patience with the slow pace of
delivery, ineffective bureaucracies and, more disconcertingly,
the complexities of institutional transformation. What will happen
if the ambitious targets are not met (because surely, quite a
few of these targets are unlikely to be realised)? What reasoning
will be provided to explain such failings? It seems plausible
that people and institutions (especially the local state) will
be held responsible, rather than recognising that some of the
targets and underlying policy assumptions are problematic.
course, it is important to speed up delivery and monitor performance.
Targets can be a useful instrument in this respect. The problem
with the current targets is not just that these are ambitious,
but also that they have been pronounced ‘from above’.
Moreover, the focus on quantity may eclipse the more complex political
debate about the qualitative aspects of achieving holistic development
outcomes. The delivery targets tend to reinforce sectoral development
approaches, for example, providing x number of houses or to eliminate
all informal settlements by 2014, etc. In the first six years
of democracy, this very same approach has produced the unintended
consequence of reinforcing apartheid spatial patterns.
reiterate, this is not an argument against targets. The point
is that the managerialism that seems to underpin the current approach
to service delivery tends to foreclose a debate about the processes
and quality of the development project. In our reading, the renewed
emphasis on the role of the state may not denote a policy shift,
but it does create opportunities for development activists –
in whatever institutional setting – to push the boundaries
and broaden the political space for discussion on the determinants
of holistic development outcomes.
invite you to share your thoughts and opinions on this matter
for the Talk Back section in the next issue of Isandla Development
This issue’s feature article in our Thought Matters section
is written by Sean Jacobs, a political researcher from Cape Town
who is currently based in New York City. Sean juxtaposes two interpretations
of the socio-economic achievements in the first ten years of democratic
rule in South Africa.
On the 10-year mark
by Sean Jacobs
latest slogan of Brand South Africa is, "South Africa: Alive
with Possibility". On June 14th, I found South Africa's branding
attempt plastered all over the walls and projected onto a giant
video screen in a dining hall on the seventh floor of the New
York Stock Exchange in Manhattan. The event was named "South
African Branding, Trade and Investment to the United States".
group of leading South African businesspeople, about 40 of them,
and deliberately it seemed made up to reflect a multiracial present,
had travelled to New York City (on the first leg of a three-city
tour including Chicago and Atlanta) to entice American investors
and companies to consider putting their money in South Africa.
mood inside the room was bullish and meant to convey an overwhelming
optimism among business and government elites about South Africa's
first decade of democracy, its current state and its future. That
morning, the most senior members of the delegation had attended
breakfast with the President of the New York Stock Exchange and
June 14th was declared "South Africa Day". Doug Franke,
an American based at Pricewaterhouse Coopers in Johannesburg offered
the assembled this advice: "Go long on South Africa."
South African delegation was of course over-doing it. They were
here, after all, to sell South Africa to possible investors. But
it is also true that South Africa as a country has some things
to be proud of. The New York meeting, along with an event one
month earlier in Johannesburg, served for me as a backdrop against
which to assess elite politics of the first decade of democratic
rule in South Africa.
the New York City meeting, Moss Ngoasheng, former economic adviser
to President Mbeki and now chairman of the COEGA Development Corporation
in the Eastern Cape, got straight to the point with his "seven
facts in seven minutes" about the South African economy.
As seven minutes became more like twenty, Ngoasheng offered a
litany of economic statistics to confirm a country that has achieved
much over the last decade and that appeared in good economic health.
Africa, with consistent positive economic growth over the first
10 years of ANC government according to Ngoasheng, has "had
the longest upswing since World War II between 1994 and 2004".
Inflation is at its lowest in 40 years; interest rates at their
lowest in 23 years. In the last ten years, the budget deficit
as a percentage of GDP has been cut from 9.5% in 1993 by 2.6%
by last year. Ngoasheng was warming up. South Africa had a "manageable
and prudent debt-equity ratio," he continued; the country
has considerably cut public sector debt. Employment was up: 11.6
million employed in 2004 as against 9.3 million in 1996. In fact,
he suggested optimistically, most would agree that the last ten
years amounted to "a good economic management story."
assured his audience that they could trust the ANC to keep to
a programme of market-led economic management. Why? The ANC has
a "twenty-year view". Broken down, that means the ANC
does not see itself losing elections for at least next two decades,
no matter what its policies. And this has allowed the ANC to develop
long-term policies. This freedom from pressure at the ballot box
means it can put through almost any set of economic policies without
fear of reprisals from the mass of South Africans and organised
political formations such as the trade unions.
Menell, one of the heads of the delegation and a heavyweight of
the South African economy, announced himself to have been a consistent
ANC voter since 1994, praising the ANC leadership as "rational,
moderate and responsible" and as having a "pragmatic
approach to creating wealth". For Menell, the ANC's policies
made clear that the organisation would not "mortgage the
country's future on short-term gains". He did not spell out
what "short-term gains" meant, but it seemed clear that
he was referring to the demands of the majority (the 90% that
can claim to own only about 15-20% of the country's wealth) as
reflected in the targets of the now-abandoned Reconstruction and
Development Programme. As Doug Franke summed it up, in South Africa
"when business talks, government listens".
and then, what Ngoasheng called "niggling problems"
forced themselves back into the conversation. These included massive
unemployment, cuts in social services, industry's lack of spending
on training, the impact of the HIV/AIDS pandemic, and the government's
controversial response (or lack thereof) to the HIV/AIDS crisis.
But no one wanted to dwell on such downers, something resorting
to statements bordering on misrepresentation. Ngoasheng kept on
repeating an unconvincing unemployment statistic of 28%. Wendy
Luhabe, the chairperson of the International Marketing Council,
briefly mentioned "reducing the high incidence of HIV/AIDS"
and reforming the lopsided education system to create "entrepreneurs".
There was nothing on Zimbabwe, although there was a lot of reference
to regional strategies in Southern Africa.
all was a practiced, united front. Luhabe called for scrapping
foreign exchange controls completely, but Ngoasheng implied that
they protect South Africa from the kind of shocks that befell
the Asian economies in the late 1990s. Robert Emslie, managing
director of Absa Merchant Bank, went so far as to call the racially
skewed distribution of wealth "unsustainable". Even
then this, however, represents a business opportunity: Absa, through
a "black empowerment" merger, wants to create a bank
that can absorb this majority.
the message was that South Africa is going places and that with
current government policies bolstered by an infusion of foreign
direct investment, it could triple current GDP growth levels (to
about 6%), tackle unemployment and deliver satisfying profits
to all concerned. This with few exceptions, and minus the overt
marketing pitch, has been the message of government, business
and its boosters since 1996. But not all elites agree on the performance
of the last ten years.
this year, another international gathering offered a similar description
of South Africa's current economic strategy, but a very different
assessment. In early May in Johannesburg, the United Nations launched
its Human Development Report 2003. The authors of the South African
section, in a stinging critique, advised the government that a
total rethink of its GEAR economic policy was urgently needed,
in favour of a "pro-poor growth strategy", which it
claimed was never a central part of government policy.
UN report puts a different face on some of the numbers trumpeted
by business here in New York City. For example, it notes that
even though the percentage of people living below the national
poverty line of R354 a month has fallen, a drop from 51.1% in
1995 to 48.5% in 2002 still means that nearly half the population
– 21.9 million people - is without basic services such as
food and clean water. And the respectable average annual economic
growth rate of about 2.7% over the past decade has not translated
into jobs, concentrating the effects of that growth at the top
of the economy. Around the same time, economist Stephen Gelb has
pointed out that the kind of growth South Africa has experienced
has further enriched those who were already rich, and increased
the gap between rich and poor. As such, growth is not "broad-based"
or "democratic" and remains characteristic of an "enclave"
Makgetla, a COSATU economist writing in Business Day, noted that
the report reaffirms that in "South Africa extraordinary
high levels of unemployment reflect not problems in the labour
market or a simple mismatch in skills, but rather the structure
of growth and the historic marginalisation of most of the poor"
that continues in the democratic context. A rose may be a rose,
but growth without jobs does not smell as sweet, especially given
trade unionists and most South Africans felt vindicated by the
UN report, what was surprising was the response from government
and its boosters. Business doubted the relevance of the report's
findings and the government questioned its credibility, while
pro-market commentators said it made for "disappointing reading".
Critics say that the report tells us nothing new. But knowing
something and doing something about it, is not the same thing.
Since 1996 the government, under pressure and with support and
encouragement from local business elites, pro-market policy advisers
and analysts as well as international financial institutions,
has stuck to an economic policy framework that they claim will
deal with these problems. All the evidence, however, points in
the opposite direction and the UN Report suggests that government
second major criticism was that the report was ideological. It
was not the UN speaking, but a reflection of ideological and policy
advocacy of the researchers who compiled the report. But as Xolela
Mangcu, executive director of the Steve Biko Foundation, noted
afterwards: GEAR is also ideological and not objective, and there
is nothing natural or preordained about the economic status quo.
"It's not so much the content of the idea as the UN-backing
that troubles the critics. They are in a panic because they are
acutely aware of the influence of the United Nations in the global
field of competing forces".
events signal the intent of the ANC government to stick with neo-liberal
positions and policies, to vilify criticism, and are in line with
current "two economies" thesis. It may also be true
that the current leadership of the ANC enjoys unparalleled public
confidence (having just received a two-thirds electoral victory)
which it translates as a mandate to continue with GEAR. It is
also true that business enjoys favourable access to government
the government insists on sticking to the "fundamentals"
on economic policy, remaining hostile to critics from the left
and inside the Alliance. But events like the UN report, as well
as skirmishes within the ANC-led Alliance, create gaps that civil
society and pro-poor researchers and activists can exploit.
this is the biggest challenge at the end of the first ten years
of democratic rule and perhaps the biggest hope for the foreseeable
future: as Mangcu noted in his newspaper column, we need a new
set of ideas around economic growth that is shared growth, in
an integrated economy, for all South Africans - one that sees
in the economy not just numbers, but the human realities behind