Growth and development
Our values are underpinned by the quest for unity instead of division, reconciliation rather than bitterness, and continuous pursuit of social and economic justice rather than accepting poverty and inequality as inevitable. More importantly, human solidarity is paramount in our country, in Africa and the world.
Today we must communicate hope in the face of a global financial crisis, in the aftermath of attacks on foreign nationals in South Africa, and we must assert that our democracy can withstand any contestation of ideas if they are based on principles, policy and the well-being of all our people.
Today we must commit to building unity and social cohesion.
Today, too, it is appropriate that we mark the ascendancy of Senator Barack Obama to the Presidency of the United States of America (USA). Congratulations are in order not simply because he is the first President with his roots in the continent of Africa, but because he has raised the expectations that the world could be better and that the USA could play a more constructive role by respecting our multilateral institutions, by solving problems through objective dialogue, and by investing in the developing world.
While not believing that a single individual can easily overturn an entire system, we must remain committed to the possibility of world peace, of economic justice and of a world in which the powerful recognise their own vulnerability if the less powerful and the powerless are unable to manage their growing levels of desperation.
South Africa has entered a time that will test our fortitude as a nation, and our ability to protect the gains we have made.
We have had over four years of fairly rapid economic growth when we were able to add hundreds of thousands of new jobs annually; when the incomes of ordinary South Africans grew 4% a year on average; and when government was able to increase its expenditure, especially on social services, by nearly 10% a year.
Our living standards have been steadily improving as we steadily but surely chipped away at the scourge of unemployment, and as we keep our focus firmly on reaching the Millennium Development Goals.
In the midst of this growing optimism a sudden black cloud descended on the world economy, posing a threat to the gains we have been making.
An international financial crisis has erupted, pushing many parts of the world economy into a slower mode, with especially some highly industrialised countries expecting very low growth or even the shrinking of their economies.
Accordingly, in South Africa we have had to lower our expectations too, not because our own financial sector is threatened - it is not. Our financial institutions have been scrutinised; they have been tested; and they have passed those tests with flying colours.
Thus in South Africa ours has been a slowdown off a secure base with sound fundamentals. Unlike in some other countries where the cutbacks have been catastrophic. We are not going to enter a recession, and indeed we expect our economic performance to be better than that of many of our peers.
One important reason for this is that we have a very big infrastructure investment programme: we are building or rebuilding roads, bridges, airports, pipelines, railway systems, houses, hospitals, prisons, schools and community facilities. In addition, we are also driving infrastructure programmes to host the best FIFA Football World Cup ever.
We will continue with this investment programme as well as our social investment, even in this difficult time because we have been careful with our finances.
Nevertheless, growth will be slower than we had previously hoped for. This is in part because the international financial crisis has reduced the demand for some of our exports. Both government and all of our households should make sure not to make financial commitments that might be difficult to sustain.
No space for complacency
Similarly, we must not be complacent about the electricity challenges that we continue to face. Not only must we continue to roll out electricity to the poor who have no access, we must also continue to manage the demand of all who already have access to electricity.
This is a time to take a bold step forward; not to stand still, or sit back as there is clearly a huge amount of work to do.
We remain committed to the six tasks identified in our Accelerated and Shared Growth Initiative (AsgiSA). These are to:
- improve our infrastructure,
- invest in the skills of our people,
- support industrial development through better competition, trade and industrial sector policies,
- strengthen the capacity of the state, especially in support of economic development,
- reduce the volatility of the rand, and
- ensure that economic growth is more effectively shared.
In all of these areas we have made progress, but it is equally true that there is still much to do, and especially in the current economic environment our ultimate prosperity lies in investing in our future.
Though we grew strongly in recent years and more people than ever before were employed in new jobs, we have not been able to reduce some of our severe inequalities. This means that the imperative of growth must more strongly be balanced by the imperative to share the growth.
Inequality and the persistence of poverty remain the most daunting challenges facing us as a nation, and if we can tackle these head on we will share with our people the proceeds of growth.
We need to strengthen our efforts to provide high quality basic services to all. Similarly, we need to ensure that the developmental outcomes of our interventions enable our people to achieve a decent quality of life.
An anti-poverty strategy must also address inequality by addressing the factors that perpetuate this phenomenon. A critical factor is skills development. Without adequate human capital individuals are unable to take advantage of the economic opportunities available.
We cannot continue to have good schools for a minority of our people and poorly performing schools for the majority. We need to address the inequalities in educational outcomes that result in inequalities in the labour market and economy.
Furthermore, in tackling poverty, we also need to ensure the accumulation of assets for the poor which will enable them to create various economic opportunities. Better roads, better fences, access to irrigation, access to electrical power - these are the kind of assets that can help poor households improve their own livelihoods.
Providing safety nets in the form of social assistance and the provision of basic services continues to be critical in our efforts to combat poverty. In the longer run, though, our goal is to reduce dependence on social assistance by assisting able bodied individuals to become self-reliant. We will know that we are reaching our objectives when the number of people requiring social assistance falls because more people have decent work or run their own businesses.
As we go forward, we want to build and reinforce partnerships at all levels between departments, agencies, business, society and non-governmental organisations. This must be based on an open and collaborative dialogue on our shared objectives and our respective contributions to shared growth and the reduction of poverty and inequality.
We need to set goals together, to focus on them and agree on concrete steps about how to achieve these goals in preparing for the next period of government, so that we are focussed on our challenges and certain about our priorities.
We encourage social partners and citizens at large not only to give their own views on these critical matters, but also to assess the impact of their own activities on the social dynamics within our nation and further afield.
As a nation we face a choice: we could continue on the same path of gradual and stop-start improvements, or we could instead identify bold steps that will raise our level of growth and development; we could be perpetually suspicious about each other or collaborate in building social cohesion and unite our people against everything that creates insecurity in our society.
** Kgalema Motlanthe is Deputy President of the ANC and President of South Africa. This is an edited extract from an address to the National Council of Provinces (NCOP) held in the Chris Hani District, Eastern Cape, 7 November 2008. |