According to the World Bank and as outlined in
the chart above, in 1990 the Gross Domestic Product (GDP) of the Republic of South
Africa (SA) was US$116 Bn as compared to that of the People’s Republic of China
(China) which was US$ 361 Bn. Move forward twenty-five years to 2015 and South
Africa’s GDP had grown by 175% to US$ 318 Bn while that of China had, over the
same period, expanded by a staggering 2966% to just over US$ 11 Tn. This means
that in 1990, China’s GDP (where GDP is defined as a measure of a country’s
economic output) was three times larger than that of South Africa and over a
period of twenty-five years China’s economy had grown to become more than 35
times larger than that of South Africa’s.
Economic success requires intelligent planning
How is it that China, a communist and a one-party
state, could achieve such aggressive economic growth output? In my opinion, the
answer lies in how the ruling Communist Party of China (CPC) drives the
country’s economic and social development through its five-year plans. The
period 2016-2020 marks the implementation of China’s 13th five-year
plan. China’s five year-plans provide a strategic outline of the CPC government’s
economic and social priorities, supported by enabling policies. Each five-year
plan is a result of extensive consultation by the CPC with various stakeholders
within the country.
These plans include focus areas by economic
sector, coupled with concrete measurable targets and often the time frames for the
achievement of the targets outlives the five-year period itself. However, during
each five-year term, focused effort is given to the identified priority sectors. The five-year
plans, once approved, their implementation is spearheaded by China’s head of state,
the President with strong support from the head of government, the Prime
Minister.
It is these plans and how they are implemented and
monitored that has positioned China as a leading global player in areas such as
manufacturing, information communications technology, ship-building, among
others. Therefore, the five-year planning culture within the CPC is what has
driven the fast rate of expansion of the economy of China.
As pointed out, China is a one-party state
where power is concentrated in the hands of the CPC therefore, the state and
government in China are effectively one and the same and this in itself may
have played and may continue to play a significant role in the effectiveness of
China’s public sector. This is unlike in multi-party states where it could be argued
that opposition party-politics tends to negatively impact the effectiveness of government and organs of state. Since 2002 Ethiopia has been emulating China’s
five-year planning model. The year 2018 will
market the start of the implementation of the country’s fourth five-year plan
(for the period 2018-2022), a result of this is that Ethiopia’s economy has
seen high rates of growth for the years associated with the implementation of
its five-year plans.
It is my opinion that lack of strategic prioritisation has resulted in what can only be regarded as lacklustre economic growth in
South Africa over the past twenty-five years, both in absolute terms as well as
relative to a country like China. To be sure, South Africa has made attempts to
have a coordinated economic and social development strategy as outlined in the
National Development Plan (NDP). However, the NPD is by enlarge gathering dust
and for those elements of the NDP that are being implemented such
implementation is uncoordinated.
How can SA accelerate economic growth?
In order for the NDP to succeed and for SA
therefore to experience higher rates of economic growth in the future, the
Presidency needs to decree the NDP as the country’s strategy. The first step
towards effecting that decree would be for SA’s State President to deliver the State of
the Nation Address (SONA) that is specific about SA’s strategic priorities
in the medium to long term, guided by the NPD. The second step would be for the
Minister of Finance to present in his/her Budget Speech to Parliament a budget
which seeks to support the implementation of the strategic priorities.
The final step would be for the Department of Planning, Evaluation and
Monitoring (DPEM), working closely with the National Planning Commission (NPC),
to be at the center of coordinating the implementation of the strategic
priorities and evaluating performance against the set targets on an on-going
basis. It would place great significance on the NDP if at each SONA, the President would provide feedback on the performance by government as a whole and all
organs of the sate against set goals for each priority area and the same should
be the case for the Minister of Finance when he/she delivers the Budget Speech.
All of this ought to be underpinned by coordinated policy development across all
levels of government and among all organs of the state.
There is no doubt therefore, that one of the
ingredients for a high rate of economic expansion for a country is a clear
strategy that is implemented in a coordinated manner and spearheaded by the head
of state and government, and in the case of South Africa that would be the President who is both head of state and head of government.
Our Politicians must show political will to create effective government !!!
