While South Africa had “a head start in the level of its development compared to other African economies” there was much to learn from the rest of the continent, many of who were “making greater progress, despite starting from a low base.”
South Africa also had a role to play in contributing to the continent’s overall progress, Nkosazana Dlamini-Zuma said.
While others saw Africa as a huge market of a billion potential customers, South Africa didn’t: “We need to be focused and systematic and embark on a sector-by-sector analysis of the national and regional opportunities exist which can create jobs and broaden economic participation.”
Exploiting the African market would involve massive industrialisation, including the development of modern infrastructure.
Education and skills
“South Africans need to be able to dream again,” Dlamini-Zuma said. The only way to do this would be through an education and skills revolution, which she called the “fastest equaliser”.
Any economic reforms, such as rural urbanisation, driving up domestic and foreign investment, and entrepreneur-orientated BEE programmes, would require a well-educated and well-skilled population.
The education system must focus on creating people who are job ready, or who can create jobs themselves and education must be based on the current needs of the economy.
“No child in South Africa should be denied an education because he or she is poor. That should be the country we aspire to, Dlamini-Zuma said.
Relationship between business and government
Addressing the principle of radical economic transformation, Dlamini-Zuma said fundamental and radical change in the patterns of ownership, management and control of the economy was required so that it would be in favour of the majority, especially the poor, most of whom are African and female.
Black economic empowerment should firmly shift to an entrepreneurship-driven model and go beyond focusing on just the transfer of ownership. “Emphasis should be on creating new businesses rather than purchasing shares in existing entities, as this does not grow the economy,” she said.
Dlamini-Zuma said there was a disconnect between government, which was running a deficit and dealing with rising debt, and the corporate sector that “remains flush with excess cash and is very hesitant to invest in the domestic economy.”
While foreign investment into South Africa had been stagnant, investments abroad by South African corporates has been on the rise. Many local companies had invested successfully in the rest of Africa, contributing to their changing their economic landscapes. “Yet we have at home seen a process of deindustrialisation, a sense of business as usual and making changes only at the margin, while the South African economy remains virtually unchanged. We should be trying to find ways to grow.”
Dlamini-Zuma demonstrated a commitment to consultation and said she was “not a person of surprises”.
When questioned about policy uncertainty and policy change, which had contributed to reduced business confidence, Dlamini-Zuma said she believed sectoral advisory groups should be established with business for discussions on radical economic transformation so as to understand what needs to be done to unlock domestic investments. Policy change was not for its own sake, she said, but to address the big challenges the country was facing.
“No patriotic South African would be comfortable with the current state of poverty, unemployment and inequality. If agree that we need to change that, let’s agree on our contributions.”
A commitment to work together towards a national vision was critical to driving implementation and harnessing the energy of all South Africans. “We all want to see a prosperous, safe South Africa where no one is left behind,” she concluded.