YONELA DIKO: ANC is not bold enough for a developmental state

In the African National Congress's National General Council (NGC) discussion document on transformation of state and governance towards the 2010 council, the party said: "The central task of the ANC is to build a developmental state with the strategic, political, economic, administrative and technical capacity in pursuit of the objectives of the national democratic revolution. It is this task that the NGC must assess and propose recommendations that will qualitatively improve the functioning of the ANC in governing the state."

Since then the term "developmental state" has been a regular feature in the ANC's lexicon to capture its state-governing ethos and aspiration.

Developmental state has, however, also been used loosely and abused over the years to mean all kinds of self-serving and nefarious things. While some people may use it to push a Father Christmas welfare state or some version of socialism, the term itself exists as an economic success for much of the world, including ancient Britain and early Americas and most recently in East Asian countries.

Fundamentally, in a developmental state a government leads and partly controls economic development. It intervenes in the markets and takes charge of some key industries while trying to level the playing field between
big and new entities.

SA is not a developmental state.

For a developmental state to succeed the economic policy must be driven from a competent state, led by morally unimpeachable politicians and bureaucracy which must coordinate all stake holders towards a common commitment to the economic upliftment of the entire country.

The state must drive economic policies with a focus on productivity and competitiveness, not a welfare focus. The state must also be unequivocal in its pro-business and pro-market policies, and lastly the state itself must
have an elite bureaucracy of unquestionable competence.

The ANC has long claimed that its vision for the South African economy is guided by the Freedom Charter’s clarion call that the people shall share in the country’s wealth.

To make real this aspiration, the ANC has chosen the developmental state as its governing model in part to use the state machinery to fulfil these aspirations and guide other stakeholders towards economic dividend of a developmental state while open enough for private interests to succeed and thrive.

The ANC said at the 2017 conference it has faced economic challenges over the years and described "the persistent low levels of economic growth, the rising national debt, weaknesses of state owned companies, low levels of business and consumer confidence, low investment levels, credit rating downgrades, policy inconsistencies and public and private sector corruption" as defining features of the latter part of its 27 year rule.

These challenges would mean the ANC has either failed as a developmental state or the ANC is incapable of being a developmental state either due to entrenched neoliberal economic culture both within the ANC's elite and or the society within which ANC governs is hopelessly entrenched in neoliberal ethos that it is foolhardy for ANC to continue to insist it is building a developmental state in its government form and content. The ANC may also not possess politicians and a bureaucracy of the kind of quality that will make a developmental state a success.

ANC has never been in control of economic development

For example, ANC has many stated resolutions from its conferences which are supposed to be driven by the stare with consensus from other stakeholders but have found no resonance in the country's economic reality that has exposed this gap between the party's developmental state aspirations and the underlying economic thought of ANC chosen bureaucracy and or economic reality not of its own choosing.

Conference after conference, the ANC has spoken about the urgent need for mineral's beneficiation in order to add value to our extracted natural resources before exporting them.

Conference after conference the ANC has spoken about establishment a state bank in order to increase access to finance for the previously disadvantaged and to help fund some government projects.

The ANC has sought to address what it considers a historical anomaly whereby there are private shareholders of the Reserve Bank and that, like other countries, the Bank should be 100% owned by the state. The ANC has found itself colliding with a prevailing reality and its bureaucracy with no appetite for such resolutions.

Even issues such as addressing the gap between incomes of executives and workers have been a hard sells.

A developmental state guided by aspirations of the Freedom Charter of equality for all would have taken bold decisions about the high levels of concentration of ownership in many sectors of our economy which prevents entry of black South Africans in these vital sectors of the economy and stifles competition.

Successful developmental state models

In the recent past, countries that have been a success as developmental states, such as Singapore, South Korea and Malaysia and even UAE led by the bright ambitions of Dubai, have had proactive and visionary leadership whose ambitions were global, creating their countries and top cities as the world's entrepots with a national buy-in of all stakeholders.

These developmental states have invested in education and high-end skills for its people, in science, technology, in world-class infrastructure. They have also intensified their international branding and attraction of foreign investments.

These countries have understood that the most important thing for a developmental state is that it must be truly independent of any special interests as the leader of economic development. Policy decisions must be objective and developed by independent experts with no political interests.

The state must also be able to create synergy between bureaucrats and trade unionists, government officials and the private sector.

The ANC had failed in much of these qualities of a developmental state, which has resulted in a ceding of its own hopes of a thriving economy to deal with the country's triple threats in the mighty hands of the private sector.

ANC must be brutally honest with itself for South Africa to succeed
The ANC's vision of creating a developmental state remains a distant dream, along with its dividend. The political elite is not ready, the bureaucracy is not competent enough and there is divided loyalties to the role of the private sector in development among the ANC elite.

Unfortunately the markets on their own will not answer our socio-economic challenges. A strong state, a competent bureaucracy, clear economic policies and strategic investments remain elusive in our context and we are not yet ready to duplicate the success of such countries as South Korea, Malaysia and Singapore.

Yonela Diko is the former spokesperson to the Minister of Human Settlements, Water and Sanitation. You can follow him on Twitter: @yonela_diko