The dividend of democracy: 20 years of economic growth

first_imgSpeaking to a group of foreign correspondents, trade and industry minister Rob Davies said over the past two decades his department has had to respond to profound changes in the global economy and realign South Africa to shifting world economic power and influence. “Where we come from as the touchstone we have a good story to tell, but there are enormous challenges ahead, and we will deal with them,” said trade and industry minister, Rob Davies. (Image: Government ZA Flickr)Brand South Africa Reporter The transformation of South Africa’s economy over the past two decades, from apartheid-era isolation to openness and growth, was the subject of a Twenty Year Review discussion hosted by Brand South Africa and the Department of Trade and Industry at Constitution Hill on Wednesday 23 April.Speaking to a group of foreign correspondents, trade and industry minister Rob Davies said over the past two decades his department has had to respond to profound changes in the global economy and realign South Africa to shifting world economic power and influence. “The domestic economy has been impacted by these changes and had also developed a dynamic of its own, which, if left unchecked, would have done little to create they type of inclusive growth that many ordinary South Africans hope for,” he said.In 1994 South Africa’s first democratically elected government inherited an economy with deep structural flaws, after lurching through varying degrees of crisis for more than a decade. International isolation, economic sanctions and the apartheid state’s resulting import-substitution approach to industrialisation had created an insular economy. This was made worse by the corrupt relationship between business and the apartheid state, with the private sector having massive power over ministers, public officials and state agencies.Short-term apartheid interests“In a number of areas such as competition, industrial and labour market policy, the private sector steered government policy in order to maximise its short-term business interests with little concern for the long-term stability of the economy or the human rights abuses of the apartheid state,” Davies said. “There was no empowerment and no inclusion.”The migrant worker system was encouraged, and wages kept low as the private sector benefited from poorly designed but generous investment and export incentives, and the intricate schemes of a feeble competition board.“As a result, the economy in 1994 was characterised by an extended period of negative growth rates, falling per capita incomes, ballooning fiscal deficit, double digit inflation rates, negative rates of fixed investment, rising unemployment, low rates of firm-level R&D, declining gold production coupled with a low gold price, and adversarial labour relations at shop-floor level.“At the industrial level concentration was extremely high, with more than 80% of all the Johannesburg Stock Exchange-listed companies owned by just six diversified conglomerates,” Davies said. “Exports were highly concentrated around mining and mineral products, mainly exported to Europe and the United States.”International isolation ensured industrial policy was heavily focused on strategic investments to ensure self-sufficiency, while the “separate development” policy of apartheid meant relatively small-scale production of consumer goods for a small market of affluent white consumers. Economic sanctions imposed to pressure the government to end apartheid resulted in little state support for sustainable exports and a low level of competitiveness in domestic industry. Desperate attempts to make the “homelands” system work caused a highly distorted investment environment, as the government sought to encourage investment outside South Africa’s metropolitan areas.Sustained economic growthOver two decades of freedom much work has gone into revitalising the moribund economy bequeathed by apartheid.“Between 1994 and 2013, the South African economy experienced positive growth in every quarter except for two of the 78 quarters,” Davies said. “In both instances where the South African economy experienced negative economic growth, international crises precipitated the contraction.“In 1998, the East Asian financial crisis led to a significant slowdown in the world economy, while the 2008 global financial crisis led to a global recession from which South Africa was not fully insulated,” said Davies.The country’s 76 quarters of growth have been the longest continuous economic expansion since the South African Reserve Bank first started keeping records.“South Africa’s economic growth performance compares favourably with a number of countries at similar levels of development,” Davies said. “The nature of South Africa’s growth dynamic is an important explanatory factor for South Africa’s poor job creation performance as well as the unbalanced trade performance over the two decades for 1994.“There are a number of important trends to be noted. The service sector has grown substantially faster than any other sector. The primary sectors – which include agriculture and mining – have been in long tern decline. The contribution of the manufacturing sector has declined and the contribution of the government has remained largely static.”Bringing black South Africans into the economySince 1994 a wide range of policies – including broad-based black economic empowerment (B-BBEE) and employment equity – have allowed black South Africans to participate meaningfully in the economy. “Government’s approach to empowerment has been a multi-pronged strategy encompassing the full spectrum of economic and social activities,” Davies said, “including access to government services such as social grants, business incentives, procurement, the stick market, employment opportunities across all sectors and the eradication of all discriminatory policies, programmes and practices.”In the past 20 years a number of organisations and initiatives were set up to support economic transformation, by providing financial and other support to black businesses. “It is important to note that government’s empowerment programmes are not only based on the need for post-apartheid economic redress,” Davies said.“From an economic policy perspective the expansion of the entrepreneurial, investor, consumer and taxpayer base as a result of governments B-BBEE policies has been substantial and has contributed positively to the growth of the South African economy.”Increasing competitivenessDavies said a major thrust of the work of the first democratic administration elected in 1994 was to inject new life into the South African economy. The redesign of the country’s competition policy and the introduction of focused small business support programmes topped the list.“One measure of industry competitiveness is exports,” he said. “Data proves that competitiveness in the manufacturing sector over the last two decades has improved. Given that South Africa does not have any export incentives of any real significance and that the exchange rate was over-valued and volatile for large parts of the period 1994 to 2013, it is probable that South Africa’s industry competitiveness has improved overall, although there remains pockets of relatively low levels of competitiveness.”Strategic trade re-positioning and diversification“In 1994 South Africa was an international pariah with limited international trade possible under international sanctions and the manufacturing sector poorly positioned to trade,” Davies said. “South Africa’s trade performance has increased progressively over the two decades with both imports and exports growing particularly rapidly in the period up to 2008. However, the growing gap between imports and exports has led to a significant and growing trade deficit, which is cause for concern.”While South Africa has successfully diversified away from the relatively slow-growing EU and US regions and towards the faster growing regions of Asia and Africa, this has come at a cost. South Africa’s trade with Asia is increasingly dominated by mining and mineral exports to China, and rapidly rising imports of value-added and increasingly sophisticated consumer and electronic goods.An important success story is the growth in South African exports to the rest of Africa as well as the fundamental changes in the trade profile of products exported into Africa compared to South African exports to the world.A downward spiral avoided“The first democratically elected government inherited an economy which was composed of a business sector which had been insulated from international competition, had become accustomed to generous cash and tax incentives from government and enjoyed a close relationship with the previous government and its key agencies such as the then board on tariffs and trade, and the competition board,” Davies said.“As the limits of economic development premised on self-sufficiency (accompanied by international isolation) low wages, and a small captive consumer market became apparent, the South African economy in 1994 could very easily have entered a downward spiral of company closures and capital flight or a period of sustained under-investment leading to de-industrialisation and the erosion of South Africa’s manufacturing capabilities.“Predictably, challenges remain. Job creation has been disappointing and has contributed to the relatively low alleviation of poverty and inequality. The risk of the industrial sector reverting to a capital- intensive minerals-based growth path and over-reliance on traditional export markets which are forecast to grow slowly over the next decade pose significant risks to South Africa’s economic growth potential.“Nevertheless, the economy is increasingly well-positioned for another period of sustained growth. The key challenge will be to ensure that the progress made in deepening and widening industrial development is accelearted and that this translates to more job-creating and inclusive economy in the next decade.”“Where we come from as the touchstone we have a good story to tell, but there are enormous challenges ahead, and we will deal with them.”Would you like to use this article in your publication or on your website? See Using Brand South Africa material.last_img read more

Architects Talking About Air Barriers

first_imgWith cocktails in their hands, architects Chris Briley and Phil Kaplan discuss green building and design issues in a casual, pithy formatJoin the guys for a drink as Chris and Phil look at air barriers — one of “The Big Three” topics (along with insulation and windows) of green construction.Sit back, relax, and be “edutained” — while you work, drive, exercise or do whatever you do while you podcatch. This week, Chris and Phil discuss:Two ways to install an air barrier: on the outside, using the Huber Zip system; or on the inside, using the Airtight Drywall Approach.Why you might want to use both systems to build a house with both an interior and an exterior air barrier.How to “plan for failure” by providing a way for damp walls to dry out.How to install exterior foam insulation according to an Alaskan system called REMOTE (the Residential Exterior Membrane Outside Insulation Technique).To design your wall assembly, you not only need to “be the water drop” — you also need to “be the water vapor.”Why you should test your home for airtightness with a blower door.How to convert cfm50 to ach50 — and why.Why you should aim for no more than 1 ach50.Why these Maine architects prefer an HRV to an exhaust-only ventilation system. ½ oz. Amaretto½ oz. Cognac½ oz. Kahlua1 tbsp. heavy creamCinnamonCombine liquors ina cocktail glass. Float cream on top. Sprinkle with cinnamon. Chris Briley is the principal architect at the Green Design Studio in Yarmouth, Maine, where he practices “architecture for life.” He is a LEED accredited professional and specializes in energy efficient, environmentally friendly design, focusing mostly on residential architecture. His accomplishments include the first LEED Gold certified home in New England, helping to found the Maine Chapter of the USGBC, and most recently, receiving a LEED Platinum rating for a spec home in Portland.Phil Kaplan is an award-winning and oft-published architect whose Portland, Maine, firm, Kaplan Thompson Architects — with the motto “Beautiful, Sustainable, Attainable” — is committed to designing only vibrant, healthy, and low-energy buildings. He also serves as Professor at UMA’s School of Architecture. His firm’s recent accomplishments include the LEED for Homes Innovative Project Award for 2009 as well as three LEED Platinum homes.About the “Green Architects’ Lounge” seriesImagine going to a green building forum, putting on your name tag, sitting in a large class room, getting your fair dose of PowerPoint, and taking notes. This Podcast is nothing like that. This is like going to a cocktail lounge afterward with a couple of green architects who then talk about the forum you all just attended.Join Chris Briley and Phil Kaplan as they discuss green building topics while sharing cocktail recipes, music preferences, and their professional experiences. This podcast is for those seeking “edutainment” while they work, exercise, travel, or sketch the beginnings of their next great project.EDITOR’S NOTE:Because Green Building Advisor doesn’t like to publish information that we haven’t tested, my wife and I decided to field test Chris and Phil’s concoction. I was surprised at how easy it was to float the heavy cream over the liquor, and how much it did in fact look like a stout beer. My wife thinks the Simple Charm “is warm and dreamy. I could sip this all night.”—RWcenter_img Cocktail of the Week:Simple Charmlast_img read more

Gilas Pilipinas flies to Doha for must-win Fiba qualifying games

first_imgPhoto by Tristan Tamayo/INQUIRER.netThe Philippine men’s national basketball team on Saturday left for Doha, Qatar for the sixth and final window of the Fiba World Cup Asian qualifiers.Gilas Pilipinas, led by Jayson Castro, June Mar Fajardo and Andray Blatche, battles Qatar in a must-win on Friday.ADVERTISEMENT View comments LATEST STORIES Oil plant explodes in Pampanga town The Philippines went 1-3 in its last four games but national team head coach Yeng Guiao is upbeat the team can still reach its main goal.“We feel very confident that we can make it to the World Cup. Our objective from the beginning is to really try and get to the World Cup,” said Guiao.FEATURED STORIESSPORTSPrivate companies step in to help SEA Games hostingSPORTSUrgent reply from Philippine ‍football chiefSPORTSPalace wants Cayetano’s PHISGOC Foundation probed over corruption chargesGilas is coming off a 100-82 rout of the Meralco Bolts on Friday in its only tune-up game before plunging back into action in the qualifiers.Blatche, who is back as the team’s naturalized player, will rejoin the squad in Doha. Joining the three on the trip are Gabe Norwood, Scottie Thompson, Roger Pogoy, Marcio Lassiter, Poy Erram, Troy Rosario, Raymond Almazan, Mark Barroca and Thirdy Ravena.The 22-year-old Ravena is the only collegiate player chosen to be part of the pool.Sports Related Videospowered by AdSparcRead Next US judge bars Trump’s health insurance rule for immigrants SEA Games hosting troubles anger Duterte Don’t miss out on the latest news and information. Grace Poe files bill to protect govt teachers from malicious accusations NBA All-Stars Chris Webber, Jack Sikma, Paul Westphal among 13 Hall of Fame finalists Oil plant explodes in Pampanga town ‘We are too hospitable,’ says Sotto amid SEA Games woes ‘We are too hospitable,’ says Sotto amid SEA Games woes Private companies step in to help SEA Games hosting Trending Articles PLAY LIST 00:50Trending Articles00:50Trending Articles00:50Trending Articles02:42PH underwater hockey team aims to make waves in SEA Games01:44Philippines marks anniversary of massacre with calls for justice01:19Fire erupts in Barangay Tatalon in Quezon City01:07Trump talks impeachment while meeting NCAA athletes02:49World-class track facilities installed at NCC for SEA Games02:11Trump awards medals to Jon Voight, Alison Krauss MOST READlast_img read more

Ateneo celebrates latest UAAP feat with another bonfire

first_imgPrivate companies step in to help SEA Games hosting Catholic schools seek legislated pay hike, too Sports Related Videospowered by AdSparcRead Next DA eyes importing ‘galunggong’ anew Duterte wants probe of SEA Games mess Trending Articles PLAY LIST 00:50Trending Articles00:50Trending Articles01:00Chief Justice Peralta on upcoming UAAP game: UP has no match against UST02:42PH underwater hockey team aims to make waves in SEA Games01:44Philippines marks anniversary of massacre with calls for justice01:19Fire erupts in Barangay Tatalon in Quezon City01:07Trump talks impeachment while meeting NCAA athletes02:49World-class track facilities installed at NCC for SEA Games02:11Trump awards medals to Jon Voight, Alison Krauss LATEST STORIES ‘Rebel attack’ no cause for concern-PNP, AFP Two-day strike in Bicol fails to cripple transport Don’t miss out on the latest news and information. center_img Cayetano: Senate, Drilon to be blamed for SEA Games mess Athletes from the other Ateneo teams were also present during the celebration even alumni such as two-time UAAP basketball MVP Kiefer Ravena and three-time UAAP volleyball MVP Alyssa Valdez.Families of the athletes were also present.FEATURED STORIESSPORTSPrivate companies step in to help SEA Games hostingSPORTSPalace wants Cayetano’s PHISGOC Foundation probed over corruption chargesSPORTSSingapore latest to raise issue on SEA Games food, logisticsA short program was held where the athletes thanked their supporters a few minutes before the bonfire was actually lit. Photo by Tristan Tamayo/INQUIRER.netMANILA, Philippines—Ateneo celebrated its athletes of the second semester with its second bonfire celebration of the season Friday at Ateneo de Manila University.The Lady Eagles captured the women’s volleyball title of Season 81 while the Blue Eagles ruled the men’s football tournament.ADVERTISEMENT Ethel Booba twits Mocha over 2 toilets in one cubicle at SEA Games venue MOST READ For the complete collegiate sports coverage including scores, schedules and stories, visit Inquirer Varsity. Ray Parks, Blackwater survive Ginebra in OT for 2-0 start View commentslast_img read more