DON’T PANIC: SA ISN’T A FAILED STATE (YET)

Separate warnings in recent weeks of SA’s slide to becoming a failed state, including from the Treasury’s Dondo Mogajane, have sparked fears. But while we’re headed down the wrong road, we’re not there yet

If the National Treasury had a rand for every time someone described SA as a failed state, Eskom wouldn’t have any debt headaches. It’s a phrase thrown around a lot, mostly by those seeking to jolt apathetic policymakers out of their slumber, or who’ve had the immense misfortune of having to interact with any of the creations of Fikile Mbalula’s department, such as the inoperable eNatis licence system.

Usually, it’s an exaggeration; compared with, say, Venezuela, North Korea or Eritrea, SA’s government can still raise taxes, is largely seen as legitimate (even if this is waning), and can protect its borders.

But last week, eyebrows were raised when the person issuing this warning happened to be Treasury director-general Dondo Mogajane. Speaking at a Deloitte post-budget discussion, Mogajane said: “The things that define a failing state are beginning to show, where we don’t care about the poor and improving their lives.”

SA’s characteristics are beginning to display an alarming commonality with basket cases such as Sierra Leone and Liberia, he said. “[Our officials need] to get off your high horse and do what we have to do to ensure we create access and a conducive environment for people’s lives to change.” In other words: implement the stillborn economic reforms to prevent the country sliding into a hole.

At the same event, SA Revenue Service commissioner Edward Kieswetter reiterated much of what Mogajane had said. “Leaders should be taking their work seriously instead of taking themselves seriously. There is a saying that China works because of the government and India works in spite of the government. We are edging closer to being a place where things work in spite of the government,” he said.

But Mogajane isn’t the only one raising this spectre.

Days before, the Institute of Risk Management SA (IRMSA) cited the danger of SA becoming a failed state as one of our top nine risks. It said the urgency of mitigating this risk “cannot be overstressed, as SA is arguably as close to a failed state as it has been since the first democratic election in 1994”.

While Bonang Mohale, president of Business Unity SA, has said that SA has an “amazing ability to go to the precipice and pull back just in time”, the institute said: “We fear that we may have pushed our luck too far this time.”

As evidence, it pointed to the unemployment rate (46.6% at the expanded definition), the grim reality that Durban harbour is now ranked the third-slowest out of 351 in the world, the fact that five out of seven small businesses fail in the first

SA is arguably as close to a failed state as it has been since the first democratic election in 1994

year, and the world’s worst inequality rate.

“If a pragmatic lens were applied, many would argue that SA is already a failed state,” it said.

Some practical steps to arrest this slide, it said, would be to incentivise investment in mining, green energy and technology; implement the Zondo commission’s findings; and second people from the private sector to help the state. “If SA continues to experience a continued breakdown of ethical and legal principles, unmanageable societal unrest and breakdown of the rule of law, complete economic collapse becomes almost inevitable,” it said.

SA isn’t there yet — but only a fool would discount this risk. The phrase “failed state” is, of course, an emotive and much-abused one. But while it might seem wishy-washy, there is an empirical index that tracks this trajectory.

Since the 1990s, a US think-tank, the Fund for Peace, has published a failed state index every year, which it has since renamed the fragile states index. It is compiled using 42million reports from more than 100,000 sources, and the findings are stress-tested by a team of social scientists. At the bottom of the list of 179 countries are Yemen, Somalia, Syria and South Sudan; at the top sit Finland, Norway, Iceland and New Zealand.

Today, SA is wedged right in the middle of the table at 89th, firmly in the orange “warning” zone. The biggest problems flagged for SA were the state of its economy (presumably poor growth and unemployment), the state of its public service, economic inequality, and its security apparatus (where the police, it seems, are part of the problem).

As the index says: “These ratings do not necessarily forecast when states may experience violence or collapse.

Rather, they measure vulnerability to collapse or conflict. All countries in the red, orange, or yellow categories display features that make significant parts of their societies and institutions vulnerable to failure.”

Here, the trajectory is important. In 2006, SA was doing much better and was ranked within the top 40% of countries, but its score has since fallen about 12.5%.

Now, it may seem that with zero state capture arrests and a presidency that can’t find the “unpause” button, things at home are crumbling as fast as the country’s roads. But this is all relative, as a number of countries are also struggling. The US, for example, experienced one of the largest drops in this index last year, and is now ranked 36th.

The good news is that in this index, SA’s ranking has, if anything, improved slightly since 2018.

So is talk of a failed state just fearmongering?

The answer isn’t clear. It is evident that there is tangible frustration in institutions which are watching an entirely preventable slide take place. But as anyone who has lived in countries that have gone entirely feral — such as Liberia or Venezuela — will tell you, SA isn’t anything like that just yet.

Which isn’t to say Mogajane’s warning is off the mark. Sensing the extent to which the country is teetering awkwardly on a fraying tightrope of stability, he was entirely right to ring the warning bell. The last thing anyone wants is for the apocalyptic risks tabulated by the IRMSA — “unmanageable social unrest”, “economic collapse”, “a lack of skills to enable economic growth and recovery”, and “a breakdown of ethical and legal principles” — to become reality.