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RACA Journal : ISSN 1812-772X
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RACA Journal Publication www . refrigerationandaircon . co . za eamonn @ interactmedia . co . za
IT ’ S TIME TO VOTE !
Economist and businessman Moeletsi Mbeki recently delivered a thought-provoking presentation titled , ‘ The SA doomsday clock is ticking : How close are we to Armageddon in 2024 ?’ to the KwaZulu-Natal business community , academics , intellectuals and political party representatives .
Mbeki must be a thorn in the side to relatives Thabo and Govan of the ANC , being a straight shooter . The first challenge of the coming post-election government , he says ( not specifying which party it would be ) if it is serious about developing the country must be to cut the cost of government in half . It must use the savings made to revive the country ’ s private construction industry , he urged .
Even if its only words , those words are music to the ears of the construction sector as it is the only industry that can absorb millions of skilled , semi-skilled and unskilled labour , while building up the country at the same time . This is of course to repeat what is said at every presentation , whether it be CESA , SAICE , SAIRAC or SARACCA . It is self-evident .
He also picked up a theme which RACA Journal wrote on in the April issue from the Industrialisation Forum – that Mauritius ought to be the economic model for South Africa , if not all of Africa , if people find the free-enterprise , full-employment American system too offensive .
South Africa has fallen to 132 on the World Bank ’ s Human Capital Index , which is a measure of how countries mobilise their human capital . Even in Africa , South Africa is now ranked well down at 13th , behind the likes of Namibia , Togo , Ghana and Zimbabwe . We have certainly set the bar low . The highest-ranked country on the continent is of course Mauritius , at 58th .
Mbeki urged a new South African government to visit Mauritius to learn how things are done competently , and that things can be different ( although we only need to look as far as the Western Cape for proof of that ). Mauritius has a strong government and very vocal opposition – but nobody is killed in Mauritius for opposing the government .
Mbeki pointed out that there are strong similarities between South Africa and Mauritius , which is a multi-ethnic society that has the same history as South Africa . As in South Africa , Mauritius has a history of slavery . In Mauritius , as in South Africa , slaves from Africa and indentured labourers from India were brought to work in the sugarcane farms owned by Europeans . Yet today , its economy is the highest performing in the continent , which is quite telling for a country that does not have any mineral wealth .
Notwithstanding a lack of mineral wealth , per capita income in Mauritius is significantly higher than in South Africa . In the 1970s it identified itself as a textile and clothing hub and used the special tariff system to get its products to Europe , the US and other countries – the same system the US used to design Agoa to help African countries to get their products to the US .
Mauritius also uses its unique location , white beaches and balmy weather to sell the country as a tourist destination . The tourism and textile industries have transformed Mauritians of all backgrounds into a middle-income society , where the state , police and private sector operate freely and efficiently , Mbeki told the conference .
Unfortunately , Mbeki – having taken the time to study each political party ’ s election manifestos – feels none of them get to the core of what it will take to solve at least some of this country ’ s problems . None have practical solutions to the issues of grinding poverty , rampant corruption and high levels of crime . It ’ s all talk , he cautioned .
He described the real issue as being that the ANC government has been creating a BEE-based middle class by taking resources from the job-creating productive side of the economy and using those resources to build up an unproductive , consumptionoriented and highly paid administrative , black middle class in the public sector .
Instead of allowing industry to use these resources – its profits – to invest in production and machinery and create jobs , the government has taken these profits and created highly paid jobs in the state for this middle class , which is the most expensive in the world . This middle class in turn uses industry profits to import expensive German cars , Irish whiskeys and expensive gadgets . This results in a shrinking economy but a growing consumption-based middle class .
Even if China was to be South Africa ’ s economic model rather than the US , Mbeki pointed out that in China , unlike the ANC government , the Chinese Communist Party uses cadre deployment to great effect . The only difference is that in China – while the private sector can pay what it wants – in the public sector there are rules that the highest-paid worker in that organisation cannot be paid a salary that is more than 11 times that of the lowest-paid worker .
He noted that the situation is vastly different in South Africa . RACA
Eamonn
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