American author Professor Chalmers Ashby Johnson is well known for having coined the developmental state concept. For him, the developmental state takes place when the state has a focused role on the growth and development of the economy and undertakes necessary policy measures to accomplish this long-term objective.
In this regard, the South East Asian countries (known as Asian Tigers), such as Malaysia, Singapore, Taiwan, Vietnam and South Korea, are good examples of nations who in the context of the developmental state successfully (though not perfectly) ushered in economic growth and recovery. They departed from Bretton-Woods orthodox policies of development and employed the Weberian style, which concerns itself with efficient use of the public purse and structural systems and is internally coherent (a notion of a strong and capable public service).
There is no doubt that the Asian Tigers provide the best example for global nations to learn from, especially those in Africa. The continent, according to Stephanie Craig, (2017), has some examples of nations which followed suit, notably Ghana, Botswana and Rwanda, that have been acknowledged to have pursued a fairly successful (not perfect) development trajectory.
In South Africa, the notion of developmental state has caused a hubbub for almost 20 years, from politicians especially in the ANC, the ruling party, and senior government officials. They continue to claim that South Africa is in motion with this noble agenda of “a developmental state”, and sometimes declare the country as a developmental state. This is a hazy concept in our case due to lack of evidence, at least in our contextual discourse and in the literature in general, of what is meant by this.
However, politicians and officials confidently use the term despite the vague meaning ascribed to it in our context. Despite a lack of consensus on what is meant by this term in our case, it has nonetheless found expression in the country’s most important policy documents.
For example, around 2000, the ANC adopted what it termed developmental local government, and this was in the discourse acclaimed as ground-breaking, necessary towards building capacity in the local sphere of government to service local communities. However, the results, unfortunately, reveal the contrary in our local municipalities. Almost 60% of municipalities are in dire straits in the Eastern Cape. In November 2018 the province’s MEC for Economic Development, Oscar Mabuyane, said that most CFOs in municipalities were under-qualified.
The New Growth Path (2011) is one policy document which prophesied that it would halve unemployment by creating at least five million jobs by 2020, arguing that this would help the country respond to the structural problems of inequality, poverty and unemployment. You will be the judge if indeed these jobs are achievable in the next two years, let alone contributing to reducing the country’s structural problems. In addition, the National Development Plan (2010) avows that social and economic transformation is impossible without a capable and developmental state. These are policy documents that cemented this hazy concept in our context as a fundamental economic growth strategy.
More broadly, the developmental objective is undertaken as a remedy for nations that suffered the historical injustice of the colonial era and apartheid, in the South African case, which continues to manifest itself through poverty, inequality and unemployment. In this context, my view is that the state broadly lacks vision, leadership as well as capacity to effect the radical transformation of society even within a shortened period.
To this effect, correctly so, Netshitenzhe (2015), implores us that the drive for a developmental state agenda, as many countries have done, is premised on the political will in government, which as I indicated does not exist in South Africa’s leadership, let alone any commitment. While in policy documents, as aforementioned, we are a nation in pursuit of a developmental agenda, in reality, there is no evidence which points to new industries created or promoted by the state as part of efforts gearing towards this noble goal. Instead of promoting industrial policies, our government plays a rather weak regulatory role.
SA requires leadership with foresight and not swayed by capital interest (which unfortunately does not exist), and to use fiscal and monetary policies to direct state ownership and control of key industries and sectors of the economy.
Because of poor judgement and a deficiency in leadership for almost 25 years, the country continues to take for granted the fact that a successful developmental trajectory in most countries was, among other things, centred on a strong, professional, competent and adept public service.
We have unfortunately paid lip service in building a strong, professional and proficient state to direct and support economic growth and development through effective state entities that can drive strategic investment initiatives.
In other words, as a “country claiming to be in pursuit of a developmental agenda,” we do not have the necessary mechanisms or instruments such as a professional and highly skilled bureaucracy to dispatch and drive our developmental agenda. Please do not get me wrong, we do have highly sophisticated and advanced skilled personnel in SA, no doubt about that, but not as part of the public service, and for me that obstructs any aspirations of having a pointed and objective, rational developmental agenda.
Last, our state-owned entities are supposedly central in transforming and driving this developmental agenda. However, they are swamped with poor governance, weak management thus corruption is inevitable. Unfortunately, this for me impedes their effective role in driving the developmental agenda.
It is not an accident of history that these SOEs now and again require bailouts from the national treasury. To this end, there is discussion ensuing in this discourse, partly emanating from government circles, that bailing SOEs is not sustainable and therefore the solution is privatisation.
The incumbent Minister of Finance is on record backing this privatisation perspective. However, there is a strong view against privatisation. I can bet that the new administration led by President Cyril Ramaphosa will privatise some SOEs such as Eskom, SAA and Transnet. He may understandably dismiss the view now in an electoral calculation, but will eventually accede. This will disable the state’s ability to strategically intervene and direct the economy to pursue the developmental agenda. DM
References: Craig, S. (2017). The Development State: What does it mean for South Africa?; National Planning Commission (2010). National Development Plan 2030. Our Future — make it work; Netshitenzhe, J (2015). Class Dynamics and State Transformation in South Africa. Journal of Public Administration Vol 50. No.3. 549-561; and Department of Economic Development (2011). The New Growth Path Framework).