Gauteng can drive a great economic future
GAUTENG’S participation in the radical transformation of the South African economy is crucial because we constitute a substantial 36 percent of our nation’s economy – which means if we can make certain things work here, there’s onethird of the economy that will be working.
In other words, if we don’t get this province working – if we put brakes on this economy – we are putting brakes on the South African economy.
In similar fashion, if we do just a little better we can guide the entire economy in the right direction.
We have to apply ourselves much harder knowing the burden we carry is equivalent to one-third of South Africa’s economy. Nor does the burden cease there, because:
In industrial terms more than 40 percent of most key industries in our economy are located in Gauteng.
Gauteng constitutes as much as 10 percent of Africa’s economy.
Opportunities
The African context is as profound as it is mutual, since if we harness the opportunities that Africa offers, when Africa rises we can rise with Africa. Indeed, our future really lies in Africa. Why? Everyone in Asia wants to come to Africa.
The European economies have literally collapsed, with Africa being touted as the answer to poor European economic growth. And the Americans are all over Africa because the real long-term prospects are here.
Because Gauteng is South Africa’s most powerful province economically, South Africa’s structural problems – principally unemployment, inequality and poverty – tend to be concentrated in Gauteng. It has to be of serious concern that: One out of every five people living in Gauteng goes to bed hungry.
Black people are still a miniscule proportion of the key players in the South African economy.
Our economy has a distinct (white) monopolistic bent.
Unskilled and semi-skilled labour is dominant in an environment where a more skilled labour force is required.
We urgently need to get our education system right.
Our small, micro and medium enterprises – which are key drivers of growth throughout the world – are too small a segment of our economy.
I earnestly suggest that the small, medium and micro-sized enterprises sector is where the major thrust of our interventions should be – a sector where young black professionals evolve as key drivers of employment.
Among several structural problems is that while we are a resource-rich economy, our resources are exported and processed elsewhere. They leave the country, only to return in processed forms.
Radical economic transformation must provide a solution. Doing so will need to marshal the entire society around specific interventions. We do not need another summit; another indaba. What we desperately need is decisive, visionary leadership.
Such leadership is defined by an ability to face up to the ultimate challenge in the face of strident opposition. There will be more resistance to economic transformation than to political transition, prompting the question of whether we have the people able to overcome resistance.
In this context, I draw attention to the achievements of the Afrikaners. Once they were clear on the path chosen, albeit a path least travelled, they pursued the objective whole-heartedly.
In the same vein, we must commit ourselves to breaking the back of monopolies in every sector through policy instruments and a whole set of other strategies. It won’t be easy, but this is what has to be done to achieve radical economic transformation.
Political democracy
The motivation is that in doing so one is doing one’s best for the people. I quote from the ANC’s 1969 strategy: “In our country, more than in any other part of the oppressed world, it is inconceivable for liberation to have meaning without a return of the wealth of the land to the people as a whole. It is therefore a fundamental feature of our strategy that victory must embrace more than formal political democracy.
“To allow the existing economic forces to retain their interest intact is to feed the root of racial supremacy and does not represent even a shadow of liberation.”
So what would be the root of the problem? Part is principal exclusion; another unemployment – principally among young people. The problem is so deep-seated that extraordinary measures are required.
One such measure would be to emulate the way in which the Afrikaners used state-owned enterprises (SOEs) to solve the problem of the poor white. Right now we are not adequately using our SOEs to solve the skills problem.
It is a problem that can only be solved by exposing young people to the coalface of our critical economic drivers. SOEs can be critical drivers of our engineering problem. SOEs are not only about the balance sheet; otherwise they would be privatelyowned enterprises. SOEs have multiple mandates, among which is the duty to foster skills and boost employment creation, especially during difficult times when the private sector may not be able to do so.
Transnet is an impressive role model. Transnet boasts an enviable record of bolstering skills development and propping up young black professionals, particularly black engineers. Transnet is an SOE able to deal with the multiple challenges inherent in radical economic transformation.
The Afrikaners wouldn’t be where they are if they hadn’t built SOEs and used them to address multiple problems involved in radical economic transformation.
If we do things the way we have done them for the past 20 years, we will still have a problem. The number of black people in the economy will still be small, as will the number of black industrialists.
We desperately need to boost the number of industrialists through the state setting aside resources to develop black industrialists and increase the number of black professionals if we are to develop sustainable industrial growth. David Makhura is Premier of Gauteng Province. This is an adaptation of his address at a recent seminar in Johannesburg hosted by Regiments Capital and the Association of Black Securities
Transnet boasts an enviable record of bolstering skills development and propping up young black professionals, particularly black engineers.