South Africa is a land of many contrasts. Although South Africa represents only 2% of the world’s landmass, it is considered one of the most biologically diverse countries in the world. The same can be said for its people, with a wide array of peoples and cultures, each unique. This diversity is South Africa’s greatest strength, but also, potentially our greatest weakness.
In 1994, South Africa was reborn as a new nation, and Arch Bishop Desmond Tutu first nicknamed South Africa the “Rainbow Nation”. This was both a reference to the country’s diverse population, but also as a way of encouraging unity amongst these people following decades of racial division, ethnic segregation and language discrimination. The term rainbow is also regarded as a symbol of hope and promise. Unfortunately, more than 20 years later many of the people’s hopes, remain just that, hopes.
Over the past couple of years, we have seen an ever-increasing move away from the Rainbow Nation concept, to an ever increasing ‘us vs. them’ mentality, with almost every conversation or topic being shaded with racial overtones – even when the subject under discussion has nothing whatsoever to do with race.
But why should this be happening? 20 years ago, the people, many of them the poorest of the poor, were promised ‘a better life for all’, and for most, the perception was that this would be a relatively rapid improvement. Even in the best of circumstances, the type of change promised would likely take 2-3 generations to truly achieve. And the circumstances have been far from the best, and have been deteriorating over the past several years.
With the new government in place after 1994, a number of broad sweeping changes were made. New legislation was introduced for further Black Economic Empowerment. Such legislation only ever benefitted the select few, who became multi-millionaires, and in the case of our current President, Mr Ramaphosa, billionaires (BBC News, 15-02-2018) (it is perhaps noteworthy, that Mr Ramaphosa was instrumental in drafting the empowerment legislation and is one of those who gained the most from it). The situation for the average citizen remained unchanged.
The reason why there has been no substantial shift of wealth is the subject of ongoing debate, with the blame being laid on “white monopoly capital”. The term “white monopoly capital” gained widespread popularity in 2016, and it appears largely for political gain. On 19 March 2017, the South African Sunday Times alleged that public relations agency Bell Pottinger was behind a social media strategy, using fake bloggers, commentators and Twitter users, in an attempt to influence public opinion and sow racial division in South Africa, as well as targeting media and personalities that were opposed to the Gupta family/ The term was also used in a fake news campaign by levelling accusations against government ministers regarded as hostile to Gupta interests, notably then Finance Minister Pravin Gordhan, by accusing them of promoting state capture for “white monopoly capital”. There is also no clear understanding or definition of who or what “white monopoly capital” is. None the less, the term remains current and is frequently used in political discourse, especially by extremist groups, such as Economic Freedom Fighters (EFF) and Black Land First (BLF).
So, if one assumes that the failure to achieve the promised transformation does not lie with the mythical “white monopoly capital”, then where does it lie? Well, I think that the first thing that we should challenge, is the statement itself, that there has been no transformation, and that the wealth remains in the hands of the ‘white’ people. Research conducted by the University of Cape Town, shows that the black middle class has more than rebelled over a 12 year period to 5.8 million people. The shifts attributable to include greater access to credit, improved education levels and BEE.
This would indicate that, in fact, it is a misnomer to say that there has been no shift in wealth. While the white middle class as decreased slightly, they have not lost significant ground, while at the same time the black middle class has grown substantially. This is a message that is almost never communicated, and is certainly outside of the general public debate? Why?
There is a case to be answered – South Africa continues to face a significant issue with poverty (a situation which is worsening). By 2017, South Africa’s Gini co-efficient was the highest in the world (The Gaurdian, 26 Apr 2017). The Gini co-efficient looks at the distribution of a countries income or wealth. What this means is that South Africa is, economically speaking, the most unequal society on earth! This in itself merits the discussion on why more has not been achieved in terms of eradicating poverty.
It is my personal opinion that this is driven by a number of factors. First, and most importantly in my opinion, is the almost complete failure of the public education system. Education is South Africa is rated amongst the worst in the world. In shocking statistics, almost one third of children in South Africa cannot read after 6 years at school, and only 37% who start school complete matric! (The Economist, 7 Jan 2017).
Where historically, schools have been divided by race, today, they are divided by wealth. Just as from a wealth perspective, South Africa is the most unequal in the world, so too are the schools, with wealthy parents, able to pay exorbitant fees to private or exclusive public schools ensuring that their children the best education. Unfortunately, this only serves to further entrench the gaps between the wealthy and the poor.
Children going through such an education are unlikely to ever succeed as productive economic citizens in the future, and are more likely to remain in the care of state, and part of the extremely poor, dependent on handouts for survival.
The second factor which has, in my opinion, driving poverty and the inequality gaps, is corruption. This has become especially prevalent over the term of former president Jacob Zuma, where the level of corruption exposed has been nothing short of breath-taking. It is estimated that corruption costs the South African GDP R27billion annually and 76,000 jobs that would otherwise have been created. (BusinessTech, 1 Sep 2017)
The long term cost of sustained corruption is however, proving to be even greater. International investments are drying up, all but two rating agencies have downgraded South Africa to Junk Status. This grading has significant impact on the economy, as this makes the country not eligible to receive the investments that are so critical to its growth.
Rather than taking steps to pro-actively address these issues, both the ruling party and opposition parties, have deliberately channelled the debate away from these areas, and created an ever increasing focus on racial segregation and “radical economic transformation”. The term “radical economic transformation”, is another political catch phrase that has gained phenomenal popularity, without any clear understanding of what this entails. Recently, this has become focused almost exclusively to the point of land – to the point where parliament has voted for a change in the constitution to allow for expropriation without compensation.
The matter of land is a highly emotive issue, across all of South African society. In my opinion, political parties, and especially the ANC are using the matter to gain/gain back electorates which they have lost in recent year’s due to disaster which was the Zuma administration. However, because this is such an extremely emotive issue for all concerned, this has the potential to run away with them – either, to protect the economy, they will need to back track on promises made, once again losing the faith of their followers, or they pursue the path of personal and political gain (which historically, seems to be the path chosen). In the short-term, this path will result in greater personal and party popularity, but in the long term, is more likely to result in the complete collapse of South Africa (either economically, by inciting civil war or both).
Why is the issue so fraught with tension? As previously mentioned, South Africa comprises a wide diversity of peoples and cultures, each having a claim to the land. From, a truly historical perspective, the peoples with the oldest, and therefore, primary claim to the land are the San people. These people having been driven out of their territories by both the Bantu populations migrating South into South Africa, and the White Colonialists moving up into Africa.
However, the San today represent a very small minority of the population, and therefore whenever the land debate is raised, it is in connection with the redistribution of land from the white owners to the black (Bantu). There can be a long debate on who ‘owns’ the land in a historical context, but in this issue, I am inclined to almost say that fact is irrelevant.
The perception exists that wealth is tied with land, and therefore, that if land is redistributed, the poor will gain wealth. This is the populist belief that the EFF, BLF and ANC are pushing forward at present with such (often aggressive and attacking vigour). But is such belief justified? The poor, and mostly undereducated black individuals certainly believe this, and have already initiated a number of attempted land grabs. The, largely white (and to some extent, black middle class), hold the opposing view that land expropriation without compensation will result in sure economic collapse.
Given the extreme importance of this matter, not just currently, but since 1994, one would expect that there would be ample, reliable, statistical data available, to monitor the transfer of land over the past two decades. In fact, this is not the case. Stats SA, does not have any reporting on this matter, and currently the only available source of information is from a report the only available source of this data is a land audit prepared by Agri SA. I cannot understand, how a matter of such importance, that methods for expropriation where already constitutionalised in our constitution from day 1, does not have a report or metric against which progress can be measured!
The political rhetoric is that white South African’s continue to hold the land. But is this even true? How can we know? The lack of information, only makes it so much easier for politicians to twist the story to suit their needs. Let look at the data which is available – the Agri SA land report.
The Agri SA report is focused on agricultural land and does not provide any detail in terms of changes in land ownership in urban areas. For urban areas, based on observation, there has been substantial transfer of ownership – within the area I live, which would historically been a white area, I would estimate that every other property is owned by a black family.
But back to the Agri SA report, which provides some insight. The report makes distinctions on various levels (ownership by value, ownership by hectares ownership and by the land’s potential/fertility). Each bench mark results in somewhat different outcomes:
(AgriSA, November 2017)
(AgriSA, November 2017)
From this, we see that a large portion of agricultural land held by previously disadvantaged ((aka black) individuals or government. If we consider the provincial breakdown, and interesting picture also emerges:
The provinces with the highest portion of land ownership in black hands (regardless of metric), are KZN, Limpopo and Eastern Cape. These are also the 3 poorest provinces, with the lowest GDP per capita in the country (Wikipedia)
The natural inference from this, is that land ownership in and of itself does not generate wealth, and ‘radical economic transformation’ in the form of land expropriation without compensation, is unlikely to provide any long term benefit to the poor. Sadly, it is my opinion, that given the levels of corruption currently found throughout the system, any expropriations are likely to go to the benefit of a few (already wealthy) individuals – just as happened in Zimbabwe.
As a further argument, that land ownership and wealth have little to no direct correlation, in Germany, the 4th largest economy in the world, 40% of households live in rented properties and 60% of farmland is farmed by tenants, and not the owner! (Eurostat)
South Africa is a beautiful country, filled with wonderful people, most of whom want nothing more than to live fulfilled, productive lives. As a nation, we have already overcome some many things and achieved results that the world thought to be impossible. Today, we once again sit on the brink. Will we fall into economic collapse and civil war, or will we once again succeed where so many before have failed?
The answer, I think lies in our leadership. During the transition around 1994, we had a strong leadership, united behind the idea of a better future for all, and the message was one of conciliation and reconciliation, and that everyone would work together towards creating a better future. Today, the leadership of the land is fractured. There is an ever increasing rhetoric that divides the people once again along racial lines, and increasing implied or even direct threat against the white minority. This leadership fails to take ownership of the true issues and continually attempts to shift the blame – after 20 years, it is still Apartheid’s fault. We can only move forward if we acknowledge the true issues facing our society and developing plans to address these.
There is no magic pill or quick fix that will overnight turn South Africa into the land of milk and honey for all. Our failures have cost us the first generation of “born frees”, who are not able to actively participate in our economy, because we have failed to educate them properly, we have failed to build our economy and we have failed to build our reputation with the world as a desirable investment destination. It will take the hard work, dedication and commitment of the entire nation to get us out of the hole we have dug for ourselves. We need stronger, better leaders whose goal is the betterment of the lives of all South Africans, not to achieve personal power and wealth.
Once again, we are at a cross roads. Which path do you chose?