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SOUTH AFRICA

SOUTH AFRICA . What is the state of our nation? SARMA - 18 June 2012. We have come a long way since 1994… . Miracle transition to democracy Black snr managers up from 4% - 26% Percentage of people below $2 a day: down from 12.1% - 5%

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SOUTH AFRICA

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  1. SOUTH AFRICA What is the state of our nation? SARMA - 18 June 2012

  2. We have come a long way since 1994… • Miracle transition to democracy • Black snr managers up from 4% - 26% • Percentage of people below $2 a day: down from 12.1% - 5% • Highest tax bracket: down from 43% - 40% • Murders per day: down from 71- 44 • Deaths per 1000 below 5 y down from 62-49 • Consumer inflation: Down from 9.2% – 5%

  3. Or not? • Unemployment up from 31.5 – 35.4% (4.2m people) • Black income as percentage of white income down from 21.5 – 20.4% • Registered security guards up with 256% (from 115 331 – 411 109) • Percentage people with HIV up from 1.5% - 17% of population • Number of farms down from 60 901 – 39 966

  4. On balance? • Is South Africa moving in the right direction? • 1994 = 43% • 2011 = 55.3% • Answer depends on individual or collective vantage point (perception is stronger than fact)

  5. Weakness 1: Incapable state • “Our development strategy requires a capable state and active citizens” (8) • “A capable state focussed on service delivery requires a passionate… public service” (13) • Only 68% spent of infrastructure budget in 2011 (R178bn - R260bn; local government!) • Examples of mining and agriculture (5) “The time has come to confront uncertainty” (31)

  6. Report to Parliament last week…. • Budget spend over 95% but delivery targets below 40% • Fruitless expenditure = R3.7bn

  7. UN Human Development Index

  8. HDI South Africa • 1980 = 0.659 • 1990 = 0.698 • 1994 = 0.644 • 2005 = 0.678 • 2007 = 0.683 • (2011= 0.619)

  9. Weakness 2: Culture of corruption • New procurement rules • New chief procurement officer • Officials with unspent budgets to held liable • Counter-evidence in both public and private sectors is quite strong

  10. Corruption Perception Index

  11. Relative CPI scores for 2011 • 1. N Zeeland = 9.5 • 2. Denmark = 9.4 • 5. Singapore = 9.2 • 46. Mauritius = 5.1 • 64. S Africa = 4.1 • 154 Zimbabwe = 2.2 • 182 Somalia = 1.0

  12. Weakness 3: Education • Good participation rate in primary ed • Weak throughput rate in high school • Drop in standards for NSC • Misfit of post-school structures • Universities: low participation and low throughput • NB This is the key source of unemployment/unemploy-ability

  13. Weakness 4: Poverty and inequality • Dangerous levels of unemployment 18-24 year olds • Growing inequalities – social alienation and the demand for economic liberation • “Service delivery protests”

  14. Gini Coefficient The Gini coefficient is a summary statistic of income inequality that varies from 0 (in the case of perfect equality where all households earn equal income) to 1 (in the case where one household earns all the income and other households earn nothing). (Source: http://www.sarpn.org.za/documents/d0000990/)

  15. Top 10 Countries with lowest Gini Coefficients(Source: adapted from: http://en.wikipedia.org/wiki/List_of_countries_by_income_equality)

  16. South Africa’s relative position

  17. Opportunity 1: Use democracy

  18. Defend democratic freedoms/institutions • Expose and hold leaders accountable • Diminish one party power to below 50% • Constitution as supreme law/Independent judiciary

  19. Ordinary people are NOT powerless • Participate in civil society Anti-retroviral medicine Arms deal re-opened E-toll saga

  20. Opportunity 2: Ride the global power shift

  21. The wave of the new global order • From West to East and South • From G8 to BRICS • From old economies to emerging ones • From commodity exports to beneficiation • From weak to excellent infrastructure (over R800bn)

  22. RSA in new global order… • Stable macro-econ and monetary policies • Stable non-toxic financial/banking system • Independent Reserve Bank • Efficient tax system with on-target collection • Attractive governance rules (JSE rules, King III, FICA) • Positive economic growth in global context

  23. Opportunity 3: Green economies • SA is perfectly placed to develop leading technologies in wind and solar energy • Well positioned to benefit from eco-tourism (quickest job creation)

  24. Opportunity 4: Positive mindset

  25. Positive attitude makes the difference If a situation is on the knife’s edge: • A positive mindset “creates” positive effects • A negative mindset is a self-fulfilling prophecy • My personal verdict: SA one of the best bets in the period 2012-2020

  26. Thank you very much! Piet Naude Nelson Mandela Metro University Port Elizabeth

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