Growth through redistribution
THE PAN AFRICANIST CONGRESS’S electoral pledge to citizens is essentially the broadening and deepening of the ownership and utilisation of productive economic resources to promote economic growth that ensures equity, the eradication of poverty and inequality and the reduction of unemployment. That policy stance represents the socialisation of economic ownership by all citizens.
We advocate that stance because we believe the fundamental purpose of economic management is the attainment of sustainable human development. Our economic policy is coupled with social development, as it’s taken as a critical element in the quest to transform the entire South African society into a more humane one.
The party’s economic policy acknowledges the following truisms: sibilities for economic growth and development (hence a redistributive economy). ficult for economic growth to translate to poverty reduction. ties for optimum economic growth. It’s thus taken as a fundamental truth that economic growth per se is a blunt instrument against the reduction of poverty and inequality. As things stand, SA’s economy is characterised by: employment growth. That’s to say, economic growth doesn’t experience corresponding employment growth. declining in importance (including the manufacturing sector, which has been overtaken by the tertiary sector) and the growing export-orientated sectors are vulnerable to international competition and becoming increasing more skill-and capital-intensive. skills categories with no chance of improving their lot because labour- intensive sectors are declining and retrenching labour. The growing sectors are beyond their reach because of their levels of possessed skills. With such structural problems in mind, the PAC’s economic policy proposes to address the structural changes in the South African economy through an economy underpinned by a growth strategy that will be aimed at stimulating and expanding domestic demand, increasing opportunities for employment and promoting indigenous entrepreneurship.
Our economic strategy has several components to it. First, we also believe government support is necessary for the development of light manufacturing industries that are labour-intensive, meet domestic demand and also lend themselves to exports (especially to developing countries in Africa). Promotion of free trade relations among regional members of SADC. Second, it’s necessary to reposition agricultural development so it focuses on the development of linked sectors, such as agro-processing and tourism and tertiary sub-sectors that support agro-processing and tourism.
Third, we propose the effective redistribution of productive assets (especially to the poor) to engage in economically productive activities. In that regard we support an audit that profiles the assets of the poor and the provision of assistance for the poor to irreversibly exit poverty and to contribute to economic prosperity.
Fourth, we recommend an assault against monopolists and oligopolists in SA’s economy so as to remove the entry barrier and to increase competition and open up opportunities for participation by all, including new brick and mortar foreign direct investment.
Fifth, we support capital-intensive companies linked to other domestic enterprises – especially small ones – in order to spread the benefits of upgraded technology.
Sixth, we pledge support for and the promotion of network relationships among small firms and between large and small firms through appropriate incentives and support.
Seventh, the promotion and support of education beyond primary and secondary levels, with an emphasis on technical skills acquisition.
Eight, we advocate an aggressive investment in social and physical infrastructure, in conjunction with the private sector.
Finally, the provision of tax incentives for job creation to small and mediumsized firms as well as large corporations.
We believe the main drivers of economic growth in the context of such a redistributive strategy should be the following: agrarian reform, domestic manufacturing, small and medium enterprises, infrastructure development, and foreign direct investment.
In a nutshell, economic growth is advanced with distributional outcomes being taken into account. There’s a need to ensure the participation of the poor in any economic growth trajectory and an emphasis on the enhancement of the elasticity of poverty eradication and employment growth to economic growth through the use of both market and non-market efforts.