The ANC may begrudgingly take on reforms but these will be cosmetic at best and will not change the fundamental relationship between party and state
Chris Hattingh is Executive Director at the Centre For Risk Analysis (CRA). With a special focus on trade, investment, and economic matters, as well as foreign policy, Chris serves on the Executive Board of the Global Trade and Innovation Policy Alliance, sits on the advisory council of the Initiative for African Trade and Prosperity and holds the position of Senior Fellow at African Liberty. Chris holds an MPhil (Business Ethics) degree from Stellenbosch University. In his role at the CRA, Chris leads strategic engagements and briefings to clients across South Africa, as well as globally.
This inevitably means that, when a party such as the ANC is in charge of state organs and tools, the default will be toward policies that increase centralisation, taxation, and power maximisation – all of which have wrought havoc on the economy, with a record-high unemployment rate and lower foreign direct investment flows as the prime examples.
This means the country's fiscus will be more fragile in future.
Basic Income Grant (BIG) – added to the increasing number of other forms of welfare – represents a major risk to South Africa’s fiscal responsibility and growth prospects.
Simply discussing the possibility of nationalisation sends a signal to SA and international companies and investors that the institution may lose all credibility
In the context of rising food and fuel prices, an official unemployment rate of 34%, and growth-depressing factors such as blockades of the N3 and persistent rolling blackouts, South Africa faces the prospect of more social unrest and instability over coming months.
Inflation is likely to remain high given that there is little prospect that substantive structural reforms in both the policy and administered price areas will be implemented any time soon (“SA consumers at ‘tipping point’ as food inflation soars, says NielsenIQ”, July 27).
There may be overtures to accountability and structural reforms, but for as long as the ANC adheres to the requirements and edicts of the NDR the incentives and pressures for corruption will persist.