Economic transformation has always occupied the central stage of the debate on the fate and direction the economy should take to contribute to development of South African society. Despite economic structural problems that militate against economic progress and development, the government has to succeed in transforming economic power relations with economic substance to the majority of poor people.
In transforming economic power relations to the majority of poor people, the government might quite consciously be aware of the daunting task ahead of it. This and the urgent need to seriously ponder how better the acquired political power could be transformed, with its full economic substance, that would be more meaningful to the previously underprivileged and disadvantaged communities.
There is no doubt in the minds of many people that political power is in the hands of the ruling party that represents the majority of blacks, but that form of political power still needs to be further consolidated and reconciled with economic power.
Unlike political power, economic power is not usually won through five-year-period democratic elections. Instead, it is either achieved or generated or, for that matter, even transferred from one group to another group. Political power could be used as a stepping stone to transform South African society, while at the same time transferring economic power to where it is due to the poor majority, so that they can sense substantive meaning of democracy and freedom in their life time.
However, transferring economic power is a complex and a sensitive subject that needs to be treated with the caution it deserves. While the economy is being gradually transformed, its power has to be consolidated first before it can be equitably redistributed among the poor people.
Apparently, the essence of political power is economic power that up to now arguably the ruling party has unfortunately not managed to acquire, own and equitably distribute to the poor masses of South Africa. Rather, it’s still grappling with it from the minority to the majority. The poignant questions this article seeks to pose are: How will the government transfer economic power?
Will it first transform the declining, less competitive economy to become the vibrant, rapid growing and competitive economy, both domestically and globally, and thereafter its power to the poor majority of the South African? Or will the government simply transfer the less competitive economy whose power appears to be too weak to empower the poor and powerless majority?
What effective radical policy instruments will the government use to transfer economic power to these poor people? Are the policy instruments such as NDP, PGDPs, NGP, NIP radical enough to effect radical socio economic transformation? Are these policy instruments responsive to the urgent needs society and economy?
South Africa may primarily have to address unattended meta-policy issues of the country. The meta-policy issue of such as: Who makes which regimes and rules for who, with which economic resources should be redistributed to disadvantaged group of people, needs to be resolved at the political governance level.
To turn the economic wheel around in favour of the poor majority by reconsidering the meta-policy issues requires extraordinary collective efforts and the political will, more than economic policy reforms?
These are some of the thorny questions whose answers might seem far-fetched. It is rather disturbing to note with discontent that the large portion of South African economy is still monopolised by few elites, most of whom got it through unscrupulous racial discrimination policies. This point has been made many times by leaders with power, but there is not much done to effect the so called radical socio-economic transformation.
On the economic front, to repair the damage caused by apartheid and colonialism, the government will have to put more emphasis equally on both broad economic transformation while growing the economy and accelerating economic development to ensure expanding equitable ownership of all means of production and the promotion of participation of the poor majority in economic activities.
The above major issues should not be viewed as separate and mutually exclusive. Rather, they should be pursued simultaneously because they are complementary to each other.
Economic growth without economic development will hardly be sustainable and the vice versa is equally true. One of the economic challenges facing South Africa is to transform the less competitive economy to become competitive at the global economy level, using effective economic policies that give the country both competitive and comparative advantages.
The government has continuously reviewed its economic policies as dictated by ever-changing circumstances and, sooner than later, decide on the appropriate approaches, strategies and policies to be adopted to deal decisively with the economic legacy of the past, which persistently continues to constrain the policy choices and efforts of the government to economically liberate poor people from all forms of social ills and deprivation.
In South Africa the majority of people might have to remain ordained to dire poverty, squalor and misery for as long as the political power is not progressively and equitable managed and utilised to generate and project an expanding inclusive economy, whose power could purposefully rescue the victims of apartheid from the hostile world of despair.
Unfortunately, after 21 years of national liberation, the economy of South Africa is still very much concentrated in the hands of the few rich minorities without any hopes that it will soon be equitable transferred to the hands of the majority.
For the past four decades, South Africans economy was in the hands of the minority whose level of competence was below average in terms economic development. However, the fact that the economy was in the hands of a white minority few does not necessarily mean it was competitive and managed efficiently.
The then-apartheid state-controlled market economy in South Africa, whose forces of supply and demand were deliberately manipulated by the apartheid government to exploit and disempower the majority of black people both in rural and urban areas, while uplifting whites exclusively, generally became a formidable hindrance to rapid inclusive economic growth and human development for all South African citizens.
Having said that, it is important to highlight the point that South Africa’s economy is at a snail’s pace being integrated and consolidated to become competitive at a global level. However, the mere transfer of economic power does not necessarily ensure that the economy will automatically fall in the competent hands of the majority, which will manage it efficiently without problems and challenges. The mere transfer of economic power to the majority is not an end in itself, but a means to an end.
For the South African economy to grow, it is imperative that the hands of the majority of South Africans are first made more competent and productive in order to cope with the responsibility of expanding and sustaining economic power, with the view of redeeming their social conditions of poverty and inequality.
Once the economic power is transferred to the majority of the people, the culture of mercilessly booting out and breaking the major butts of inefficiencies and ineptness in both public and private institutions could be inculcated to ensure economic progress and sustainable socio-economic development that serves as a base for long-term sustainable human development to benefit poor communities.
The often-talked-about black economic empowerment, however you define it, as one mode of transferring economic power, seems not to be doing well to turn the economic wheel around to the benefit of the majority of black people. Hence, it is viewed in many quarters as a shameful failure to empower the poor people. Thus black economic empowerment does not appear to be done in a manner that has benefited the majority of the people.
Brian Mahlangu is a member of the council at Vaal University of Technology.