President Jacob Zuma has argued for radical economic transformation through fundamental change to the structure, systems, institutions and patterns of ownership, management and control of the economy.
There was no better place to engage in such a debate than last week’s annual conference of the Black Business Council (BBC), hosted by the Industrial Development Corporation.
I was eager to understand whether the BBC would take a view on these matters and radical economic transformation in the prevailing environment of state capture and corruption.
The speaker line-up included ANC treasurer-general Zweli Mkhize, who was well received and got a standing ovation at the end of his speech. He was preaching to the converted, though, since the ANC was the only political party invited, perhaps because it is in government.
A more cynical view is that the BBC has been captured and repurposed in support of President Jacob Zuma — the organisation’s president was very quick to dismiss the notion that radical economic transformation was a product of Bell Pottinger, arguing that it came out of the ANC 2012 Mangaung conference.
As a lead participant in the "transforming the economy" commission, I was perturbed by the emphasis on the state and what it should be doing for black business.
I was poorly prepared compared to some in the commission, who had bought into radical economic transformation ideologically to justify a potential new regime of accumulation.
The regime advocated by some delegates appears to be increasingly located in rent-seeking as opposed to the search for profit-driven efficiencies within the production process.
Somewhat unexpectedly, it is characterised by black entrepreneurs who are growing uninterested in the how or where of production in favour of the capture of existing value that is in the hands of white compatriots.
Statistician-general Pali Lehohla had earlier spoken on the centrality of planning and using statistics in radically transforming the economy.
Emphasising that the National Development Plan 2030 was a vision rather than a plan, he voiced his frustration with politicians’ limited understanding of the power of data.
Of the estimated 56.5-million South Africans, the proportion of the elderly (60 years and older) is growing, reaching 8.1 % in 2017 — about 4.6-million people in SA are over the age of 60.
The country’s rapid demographic transition as the population ages is expected to affect the economy through various channels.
Due to the continuing low fertility rate, the size of the workforce will decline and lower SA’s growth potential.
From a household perspective, increased longevity will alter economic decisions about consumption, saving and working hours.
Specifically, longer life expectancy tends to increase the incentive to work, and the official retirement age may be pushed out. Moreover, lower fertility implies that fewer children will be present in households during people’s working years, which will probably reduce consumption before retirement.
Lehohla showed that statistics are a planning tool for inclusiveness and income distribution that can transform our economy.
Unfortunately, the statistician-general’s sober message fell on deaf ears as some of the delegates in my commission could only hear the radical economic transformation drumbeat.
• Mondi is a senior lecturer in the Wits School of Economic and Business Sciences.
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