Terence Corrigan
The State of the Nation Address is typically framed around some metaphor or slogan. Last week, President Ramaphosa invoked the image of the fynbos. It is, he reminds us, a resilient plant that goes through periodic destruction, after which it grows again.
‘At least once every twenty years, fynbos must burn at extremely high temperatures to allow the ecosystem to be rejuvenated and grow afresh. Throughout the summer, the burned foliage lies desolate. But when the autumn rains return, the seeds germinate, and its life cycle begins all over again.’
It's an intriguing metaphor, for a difficult time. Note the assumption of cycle and inevitability. The fynbos ‘must’ be destroyed to ‘allow’ its regrowth. Following the rains – which come according to their season – the ecosystem regenerates.
And so, the president says, South Africa’s economy has been devastated by a global health pandemic, and will recover, bursting into vibrancy again. The pandemic has not only been a blow, but an opportunity. It will enable the economy to be reconstituted on the bases of justice, inclusivity and rising prosperity.
But the president might also have noted that for all its resilience, many varieties of fynbos are endangered. Periodic fires may be a part of its lifecycle, but its sustainability is dependent on so much else.
Wilfully or otherwise (and if the latter, it is matter of grave concern), President Ramaphosa’s SONA failed to recognise that South Africa’s present crisis was not primarily the fault of the pandemic but of an ecosystem that has been failing for years – if not one directly hostile to his government’s purported goals.
Aside from the stress on dealing with the health crisis (which, as the vaccine imbroglio has shown, has not been a shining success), the president emphasised the need to ‘accelerate our economic recovery’ and to institute ‘economic reforms to create sustainable jobs and drive inclusive growth’.
In the abstract, there is little to criticise here. But there is also a tedious, almost complacent, familiarity about this. The president’s address was largely a restating of last year’s Economic Reconstruction and Recovery Plan. This in turn – despite its rhetoric about the need for a ‘reset’ – fundamentally restates what was already policy.
Resolutely not on the agenda is reform in the sense of reconsidering the existing policy trajectory, and setting South Africa on a new one. The assault on property rights continues. Passing the Expropriation Bill, which will confer extensive powers on the state to seize private property, remains a top priority for the African National Congress and the government it leads. So does amending Section 25 of the Constitution. The ‘debate’ around these measures has already contributed in no small degree to the dismal economic performance that preceded the pandemic (GDP growth of a mere 0.8% in 2018, and 0.2% in 2019); their passage will compound this. Recall that these enhanced powers over people’s property are to be handed to a state that has shown an extraordinary capacity for venality.
President Ramaphosa confirmed in his SONA that expropriation was envisaged as a strategy for land reform. This is how these plans have been presented for years. But expropriation powers are applicable far beyond this narrow field. There is a very real danger, probably more a certainty, that they will be targeted at other assets.
The most obvious candidates for this will be savings and pension funds, prescribed to plug fiscal gaps for which no workable strategy apparently exists, and whose remit considerations of ideology and patronage at any rate severely limit. At the moment, talk is ambiguously of ‘unlocking’ pension funds – as the Economic Reconstruction and Recovery Plan puts it. But with the backstop of new expropriation powers, the way is paved for something altogether more coercive.
Meanwhile, racial empowerment policy remains inviolable. ‘To address the deep inequalities in our society, we must accelerate the implementation of broad-based black economic empowerment policies on ownership, control and management of the economy.’
The notion that these policies may actually be exacerbating those inequalities is not to be considered. Yet this is another area in which state action has not only failed to achieve what might be considered its nominal goals (inclusion and countering inequality), but has functioned as a significant disincentive to doing business in South Africa. By constricting overall growth and locking aspirant participants out of the economy, it is imposing a steep cost on the country.
When President Ramaphosa declared that ‘we are making it easier for business to do business’, it can only mean that he or those advising him are completely divorced from the reality of running actual businesses. Of course, it is to be welcomed that there are opportunities to perform administration requirements online, but on the large issues that hit the country’s competitiveness, there was essentially nothing.
Indeed, business awaits tougher and more intrusive racial diktats in terms of pending amendments to labour legislation – let it not be forgotten that the minister of labour declared his intention to be ‘very harsh’ on employers that failed to meet his demands. And while the government talks incessantly about the need to support ‘labour-intensive sectors such as tourism and agriculture’, it has just hit both of them with new wage requirements. Don’t expect too much here, then.
This is, to extend the speech’s metaphor, not a biome that has experienced the trauma of the shock of creative destruction, but one being overwhelmed by a poisoned ecosystem, the product of years of drought and degradation. It will take careful stewardship and intensive care to restore it.
Sadly, one comes away from this with a sense of a country in extreme distress, and a government largely unable to think creatively in terms of resolving it. With little to offer in the way of practical solutions, maybe all that is left is the symbolic and political showmanship of tough talk and tougher policies. But this is an offering that is ideological rather than pragmatic.
The SONA suggested no change of course, and should prompt scant optimism for the future if South Africa continues on this path. It is time that all those with a stake in the country – analysts, business, South Africa’s people – recognise this.
* Terence Corrigan is a project manager at the Institute of Race Relations (IRR), a liberal think tank that promotes political and economic freedom.
