SA, finance capital and the land question

11 Sep, 2018 - 00:09 0 Views
SA, finance capital and the land question President Cyril Ramaphosa

The Herald

Abayomi Azikiwe Correspondent
Even after years of initiatives such as black economic empowerment, only 14 percent of top management positions are held by Africans although they make up 78 percent of the labour force.

South African President Cyril Ramaphosa has said that the technical recession announced in the country and internationally is only a transitional phase.

The ruling African National Congress (ANC) leader and head of state will be standing for elections in less than one year.

Reports of an economic slump are being utilised by the opposition to cast aspersions on the continent’s oldest liberation movement turned political party.

Ramaphosa came into office from the deputy presidency, with the resignation of former ANC leader and President Jacob Zuma in February.

Both the domestic opposition to Zuma in and outside the ruling party, along with international interests, attributed the slump in economic performance prior to early 2018 to the atmosphere generated by allegations of corruption against the former president.

With the assumption of the presidency by Ramaphosa, the leading economic indicators improved.

Nonetheless, Ramaphosa, a co-founder and former secretary-general of the National Union of Mineworkers, a leading affiliate of the Congress of South African Trade Unions (COSATU), sought to create an image that the political situation was stabilised and ripe for foreign investment.

Ramaphosa knew that he had to unite the ANC internally and reinforce the strained relations between the ruling party and its allies within COSATU, the South African Communist Party (SACP) and the South African National Civic Organisations (SANCO).

Yet other long-standing issues require addressing before the ANC can rest assured of not only recapturing the presidency and parliament in 2019, notwithstanding on a level which is approaching a two-thirds majority.

Opposition parties remain far behind, while the alliance of convenience between the right-wing Democratic Alliance and the putative “left” Economic Freedom Fighters (EFF) appears to have imploded.

A resolution passed jointly from the EFF and the ANC by the National Assembly in late February called for the seizure of European settler-owned land absent of compensation.

White farmers became nervous about the prospects of losing their ill-gotten wealth.

This is obviously a key element in the recessionary spiral, which is dominating the political landscape.

Statistics South Africa reported on September 4 indicated that there was 0,7 percent negative growth in the second quarter of 2018.

In addition, a revised assessment of performance in the first quarter was placed at a 2,7 percent contraction.

A recession under capitalism is declared when there are two consecutive quarters of negative growth within the national economy.

Other aspects of the malaise are manifested through the more than 27 percent official unemployment rate in South Africa.

In the agricultural industry, production fell by 29,2 percent in the second quarter right after an even larger drop of 33,6 in the first quarter. The causes behind this decline are said to be resulting from crop failures due to drought in the Western Cape and a hailstorm in Mpumalanga.

On September 5, the value of the South African rand also went down with the realisation of a renewed recession, said to be the first one since 2009.

However, and surprising to many, there was a slight rebound by the following day with one rand being equal to US$0,065 as financial publications said that the South African currency was too undervalued.

The land question and national wealth

Overall, since 1994 when the ANC came to power, the overwhelming majority African population controls only a small portion of the economy.

As it relates to the Johannesburg Stock Exchange in 2017, only 3 percent of shares were owned by the indigenous people. Skilled and professional fields are continuing to be dominated by Europeans.

Even after years of initiatives such as black economic empowerment, only 14 percent of top management positions are held by Africans although they make up 78 percent of the labour force.

Land ownership, which was a key demand within the national liberation struggle, has fallen far below of what is needed and desired.

White-controlled mining firms, factories and agro-business enterprises represent the bulk of land usage. At the time of the end of apartheid, 80 percent of the land was in the hands of European settlers.

Since 1994, land reform has been at a snail’s pace, with the most optimistic estimates of some 10 percent being transferred to people within the African majority.

Abayomi Azikiwe is editor at Pan-African News Wire.

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