While dismal education outcomes are infuriating, believing they preclude healthy growth can be more limiting than education failures themselves

Robert Mugabe’s death warrants reflecting on how inflaming anti-colonisation sentiments benefits ruling elites while dousing economic vitality. Preserving colonial animosities explains much of SA’s inability to conceive a high growth plan. 

The global economy’s dynamism makes isolationist biases unaffordable. If patronage, corruption and state-owned enterprise (SOE) mismanagement were suddenly vanquished, sufficient sustainable growth would remain elusive pending far greater global integration. 

SA’s stagnating discretionary income is meagre relative to its compounding social obligations and debts. Access to much greater spending power is needed to pummel unemployment. 

Adequate growth requires surging exports. Instead, redistribution-focused policies are over-indulged as they benefit populists, unionists, communists and cronies. The anti-competitiveness effects of excessively embracing redistribution are then obscured through stoking colonial resentments. 

The misconception that export-focused workers must be highly skilled breeds further isolationist thinking. Asia’s boom relied on massive volumes of previously destitute workers. Export channels were developed and on-the-job upskilling followed.

In economic speak: SA’s binding constraint is market access to sufficient purchasing power. Many Asian nations overcame the same constraint with skill-upliftment initially following from high growth — and only later driving it. 

While dismal education outcomes are infuriating, believing they preclude healthy growth can be more limiting than the education failures themselves. Such false perceptions largely stem from school-aged social conditioning around the importance of education. Elitism and other harmful prejudices now percolate.  

In many cases, a few talented managers can successfully employ a huge number of poorly-educated workers. Consider how Uber has disrupted transport norms with modest numbers of managers. 

SA’s lack of access to adequate consumer spending can be traced to the government’s inward-facing policy focus. Overcoming pervasive poverty and unemployment requires tamping anti-colonial sentiments to support entrepreneurs pursuing new export channels.

Domestic spending power cannot fuel noticeable employment growth as the vast majority of SA households are poor, over-indebted, or both. Companies that help attract international travelers, such as Airbnb and Uber, resemble what is needed, yet there are practical limits to growing international arrivals.

SA must mimic Asia’s emphasis on developing niches within global supply chains. Disruptions will continually threaten supply-chain alliances thus presenting opportunities for new entrants while the rising access to the internet is overcoming the market access disability of remoteness. Meanwhile, the range of labour inputs which can be digitalised is steadily expanding. Importantly — and unlike in SA — the global ratio of low-skilled workers to affluent households continues its long-term plunge. 

Making economic success contingent on rapidly upgrading our education system reflects defeatist thinking. Such negative notions are then reinforced by believing SA’s companies must compete directly with Asian factories. A solution mindset is further undermined by presuming SA companies must compete by producing complete products and services. 

The largest volume of new jobs might be gig-styled positions more resembling Uber drivers than traditionally structured employment. Phone apps should, however, also remind us that what will be moved, manipulated or created will often not be physical but digital. As it becomes increasingly feasible, technologically and economically, for people in remote locations to add value to physical and digital processes, then connecting low-income communities digitally can provide high-volume employment options for personalised contributions by lower-skilled workers. 

The revolution toward mass customisation of many consumer products has begun. Consider YouTube from the perspective of a traditional broadcast executive. It requires massive volumes of small, personalised packets. Multitudes of YouTube-like disruptions are possible, contingent on a large, creative workforce being accessed at low cost. Most countries are competitively disadvantaged to disrupt traditional production processes through personalisation due to high wages and low unemployment. Such shifts often begin modestly. China’s manufacturing initially focused on textiles and toys.  

It is difficult politically and ideologically for our fractious ruling party to pivot away from focusing on domestic redistribution to genuinely embrace global integration. Conversely, SA’s private-sector leaders are highly motivated to support much greater emphasis on export-led growth. Yet they routinely support domestic initiatives, which, collectively, are inherently inadequate.

The battle that is brewing will confront the unsustainability of the ruling party’s redistribution focus ranging from BEE regulations to the threat of prescribed assets. Sound economic arguments will not, however, resonate with a freshly re-elected party riven by factions. Instead, a workable path should be offered that is politically attractive and commercially robust.  

Confronting corruption and SOE mismanagement is overwhelming government. Planning is stuck at goal setting and issue framing. Meanwhile, surging value-added exports is an economic requirement dependent on entrepreneurial creativity uncovering new export channels. As small business development is universally supported, to sidestep the country’s dysfunctional politics an export-led growth strategy should be branded as a small business development push. 

The trajectory of Mugabe’s rule showed why SA must temper anti-colonial reflexes to support export-focused entrepreneurs. Unhelpful debating must give way to a commercially sound plan that is packaged to elicit broad support.