Land debate the first of many we need to save SA
Ido not recall a time, at least in my working life, when we were told that the economy had gone into a recession, and then spending months agonising about what all this meant for South Africans, only to be told that, actually, we never had two quarters of negative growth.
This week, Stats SA announced its 2017 fourth-quarter gross domestic product (GDP) numbers, which showed growth of 3.1%, thanks to the agriculture, forestry and fishing industries, which increased by 37.5% and contributed 0.8 of a percentage point to the number.
All in all, it turned out that the economy grew by 1.3% last year. The last quarter of 2016 was revised from a contraction to growth of 0.4%. This meant that the contraction of 0.5% in the first quarter of 2017 was not a second consecutive quarter of contraction, and therefore we were technically not in a recession.
While this may make us feel better, it is not of real consequence. The reason for that is population growth.
What really matters when measuring the size of an economy is not so much the total GDP number but GDP per capita. It divides the country’s GDP by its total population and makes it one of the best measurements of a country’s standard of living, although it ignores inequality and assumes that all citizens share equally in the economy — which, in our case, which is untrue.
South Africa’s average population growth is about 1.6% per annum. With GDP growth of 1.3%, this means we are getting poorer per capita. Add to that the high domestic inequality we have, thanks to centuries of colonisation and decades of apartheid, and our real economy is not in a good state.
For the balance of this year I expect the phrase “policy uncertainty” to feature heavily in the results announcements of listed companies and reviews of rating agencies, and rightfully so.
Unless South Africa starts finding logical and effective ways to implement gamechanging policy, we will not outstrip population growth, let alone reduce inequality.
The first policy debate out of the blocks this year is land. Land policy has gone through various rebrandings, having started as land restitution, land redistribution and lately land reform, while implementation kicked off as “willing buyer, willing seller”, then became “just and equitable”.
Now we are firmly in “land expropriation without compensation”, with a few caveats around food security.
All this should be a warning that ignoring or postponing the wrongs of the past and hoping they would sort themselves out is not sustainable. Hope is not a strategy.
So instead of being scared of radically changing policy, in fear of socioeconomic instability, we need to challenge ourselves to find solutions that solve fundamental problems. But first we need to fully understand and comprehend the problems.
Former Pan Africanist Congress leader and MP Motsoko Pheko once said that “the ongoing land controversy in South Africa started with the Berlin Act of February 26 1885 through which this African country became a British colony. And even though colonialists called it the spreading of ‘Western Christian civilisation’ it was, in fact, colonial terrorism”.
Pheko continued: “This pseudo-civilisation was followed by a British colonial law called the Union of South Africa Act 1909. Its main aim was to unite the four British colonies of Cape, Natal, Transvaal and Orange Free State to fight the ‘native danger’ of African resistance against European colonialism. This act immediately legalised racial discrimination against Africans. Section 44 read, ‘The qualifications of a member of the House of Assembly shall be a British subject of European descent’.
“Within four years of the Union of South Africa Act, the colonial parliament, with the approval of the British government, passed the racist and genocide colonial law allocating a paltry 7% of their own country to over five million Africans and giving the remaining 93% of the African land to
349 837 European colonial settlers. This was done through the Native Land Act 1913.”
This was a crime against humanity. It was theft.
Fast-forward to present-day South Africa and statistics show that its people are growing poorer on a GDP-per-capita basis, and, on this one score of land ownership, we are nowhere closer to righting a wrong committed more than 100 years ago.
Land ownership has the potential to be a stimulus in reducing inequality in our economy. Let’s have the debate with sober minds and appropriate context.