Ownership of the economy in SA remains skewed
UNDER normal economic conditions of any country, set economic goals entailed in growth and development plans that cannot be realistically achieved either in the medium or long term, are not worth pursuing. In some circumstances, it is easy to believe in the big myth than in the small truth. The situation in South Africa is that the nature and structure of our economy in terms of ownership, management, control and active participation, remains unfairly skewed in favour of a few people against the poor majority of its citizens.
This structure has always been exclusive for more than a century and remains exclusive for more than 50 percent of the population. It can hardly produce inclusive economic growth to the benefit of all citizens. The economic residuals that arise from this exclusive structure further pushes this category of the poor citizens to the deep end of poverty and hardship.
This scenario was not definitely divine given rather it is the undesirable outcome of deliberate economic policy design by some to create and produce long-term inequities that may not easily be credited through exclusive and inequitable distribution of benefits of growth to the few owners managers and controllers of means of economic production.
At times what is often stated by those who believe they can change such a structure is not the same as what gets done by those who control, manage and own economic means of production.
We have grown accustomed to the tradition of wanting to believe what we hear and not what we see. We believe that this exclusive nature and structure of economy will one day yield inclusive economic growth for unemployed South Africans, whose number is said to be around 40 percent.
Even the reduction of poverty in the past 10 years is not a direct result of an inclusive of progressive economy but the increase of social grants to vulnerable groups.
Reduction of poverty in past 10 years is not due to a more inclusive economy, but to social grants that have brought some relief for the poorest of the poor
Untransformed
This could make the dream of a better life not possible even in the long term as the nature and structure of our economy remain untransformed and exclusive of the 40 percent of the poor South African citizens. Even if the economy was to grow at more than 5 percent, the question remains which political and economic policy instruments can be used with responsive results to solved the problem of ownership, management and control of the country’s national resources.
Should we re-engineer the structure of the country’s economy as a primary priority while maintaining acceptable levels of economic growth in the context of a globalising economy?
As modernised as it is, the country’s economy remains untransformed and exclusive. It transits from one stage to another as it adjusts to global forces and due to technological advances. But this transition tends to perpetuate de-skilling, income and social inequalities, as well as, unemployment on an unprecedented scale. The South Africa’s macro-economic policies are neither based on general nor a consensus-driven framework, consciously designed to deliberately level the playing fields.
The goal should therefore be to restructure the underlying fundamental structure of the South Africa’s economy to become all inclusive, participatory and representative. It should also be equitable in terms of ownership, management and control so that it can yield shared economic growth among all South Africans.
If managed proficiently, the imperative to transform the economy does not clash with the need to stimulate inclusive growth. These strategic economic goals could be pursued successfully without causing harm to anyone or compromising the credible efforts of the government to stimulate economic growth through job creation and capital formation.
With such, even the much talked about radical economic transformation could be realised in our lifetime.
Policies
A fundamental re-engineering of policies cannot be executed successfully by merely paying lip services, using blunt instruments that have proven to be failures.
Extraordinary measures and at times unpopular choices need to be made by the political and economic leadership with the courage and commitment to make the economy yield results for all.
In bringing the excluded to the ownership, management, control and active participation in the economy, there is value to be created and responsibility to be exercised.
South Africa’s transformation project as a necessary route to escape the legacy of apartheid witnesses a failure of great magnitude owing to its inability to progress beyond economic stagnation to the stage of meeting legitimate demands and expectations.
For the underprivileged, transformation continue to remain a pie in the sky. They remain stuck in the deprivation trap of underdevelopment, characterised by poverty inequality, unemployment, high dependency ratio, racism, corruption and homelessness. The longer it takes South Africa’s transformation experiment to overcome these societal structural challenges, the more likely that transformation project will lose credibility in the eyes of her supposed beneficiaries.