[Letter] Crises are a result of state policies

SA is not a failed state, but it is a de-developing state (“Business joins Ramaphosa’s effort to fix SA”, June 7).

Consistently lower economic growth and activity (0.4% economic “growth”) is nothing to crow about in the light of declining gross fixed- capital formation hovering around the 13% mark in 2022 when it should be between 25%-30%, rolling blackouts and structurally record-high unemployment.

These crises afflicting SA are no accident; they did not appear out of nowhere. They are the inevitable consequences of the policies and regulations chosen by the government since 2007/08.

The partnership initiative announced by the government and organised business contains much promise. But should it come to nought it might well prove an avenue for the government to point to the crises afflicting the country and say: “We sought to engage with the private sector, but they did not come to the party.” New policies and regulations that further intrude on economic freedom, make investment more difficult and give the state yet more arbitrary power, could follow.

That the country’s de-development is arrested at various intersections is down to the hard work, innovation and drive of the private sector and civil society. Organised business can use its capital, skills and influence with the government to push for reforms and solutions that would place the country on a better path. But at the same time it should not be afraid to walk away if the government continues with destructive policies.

Expropriation without compensation and the proposed National Health Insurance immediately jump to mind. Will a line be held on these? I fervently hope my scepticism is proven wrong.

Any engagement with the state should be unequivocal that reform must happen on condition that state control and interference cannot simply be replaced with different forms of state control and interference.

With a youth unemployment rate of more than 70%, consistently low business confidence and social compact after social compact having amounted to very little, the burden of proof rests squarely on the government.

Businesses can absolutely engage in activities such as the partnership initiative. That organised business loves SA is clear; that doesn’t mean it needs to love the government, or engage only on its terms, demands and requirements.

In the meantime South Africans more broadly ought not to wait for solutions to filter down from the corridors of bureaucratic power. The solutions and alternatives are there to be found, built and implemented. Too much is at stake to wait on a government that at base is still pursuing policies and regulations that are the polar opposite of what the country needs.

This letter originally appeared here. 

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