SPEECH BY FORMER PRESIDENT F W DE KLERK TO THE ADELE SEARL MOUNT NELSON 100 CLUB, CAPE TOWN 8 NOVEMBER 2004

 

SOUTH AFRICA – THE ROAD AHEAD.

 

It is much easier to speak with authority about the past than about the future – particularly in our fast-changing world.   Almost every second speaker this year has been able to relate the undoubted successes of our first decade.  And there have been some remarkable successes, including

• The government’s macro-economic policies that have reduced inflation, interest rates and the deficit to the lowest levels in decades;
• The highest business confidence levels in ages;
• The modest – but sustained – economic growth that we have been able to achieve; and
• The strong growth that we have recorded in our manufactured exports and in our tourist industry.

 

Speakers can also point to

• The emergence of a vibrant multiracial middle class;
• The more than a million new homes that the government has built;
• The provision of electricity and pure water to millions of South Africans; and
• The substantial increase in welfare payments to children and pensioners.

 

On the other hand, when critics look back on the past ten years they can mention

• The widening gap between rich and poor with all the social problems and tensions that this causes;
• The growth in unemployment – although there are some promising indications that the economy has, at last, started to create jobs again;
• The continuing unacceptable levels of serious and violent crime – despite the progress that we are beginning to make;
• The enormous challenge and tragedy of AIDS; and
• The fact that our multiparty democracy is not functioning as effectively as we had hoped.

 

 

In my view the success South Africa achieves during the coming ten years will depend on our ability to meet four great challenges:

 

• Will we be able to improve the lives of the 50% of our population that continue to live in abject poverty?
• Will we make a success of black economic empowerment?
• Will we be able to compete successfully in a globalising world?
• Will we be able to maintain national cohesion and avoid racial alienation and friction?

 

The roots of black poverty lie on the one hand in unemployment and on the other in the fact that the poorest South Africans continue to have the largest families. Unemployment increased for the black population from 36.2% in 1995 to 46.6% in 2002.   What then is the main cause of unemployment?   Many relevant answers come to mind – including

• retrenchments resulting from the intense competition in the globalised economy;
• lack of skills and training;
• sluggish foreign and local investment in the economy; and
• competition for jobs from the huge and growing number of illegal immigrants.

 

However, another central cause is South Africa’s present labour legislation which has raised the real cost of labour way above levels in other emerging economies with which we must compete in global markets.  High costs and rigid regulation are a major disincentive to the creation of new jobs.

 

Clearly, we need to develop a labour system that establishes basic minimum standards for all. However, in a country like South Africa much greater flexibility is required, especially for medium size and small businesses.

 

Family size is another factor in the perpetuation of poverty.  It stands to reason that the more people there are in a family, the fewer the resources there will be to provide decent care and education.

 

We also need to improve service delivery to the poorest sectors of our society.  Efficient education, social services and health services can greatly help to improve the basic living conditions in which they live.

 

President Mbeki is quite right to emphasise that our second decade must focus on economic and social transformation.  All of us – black and white South Africans working together – must succeed with the economic empowerment of all truly disadvantaged South Africans, most of whom are black.

 

• The best way to do this is will be to improve our education system. We need primary and secondary schools that will produce matriculants with proficient language and mathematical skills.  Dilution of standards and introduction of over-sophisticated education approaches are no substitute to the development of sound basic aptitudes.  We need universities and technicons that will provide the engineering, technical, scientific and managerial skills that will enable South Africa to compete effectively in globalising markets.
• We need to develop natural approaches to extending ownership of economic resources to disadvantaged South Africans – particularly by enabling employees to become shareholders and through wider participation in pension and insurance schemes.
• We need to encourage and nurture entrepreneurs from disadvantaged communities.
• We need a balanced and effective approach to the very sensitive question of land reform. This process should begin with land that is already controlled by the government and the objective should be to ensure that agricultural land – whoever farms it – remains fully productive.

 

I am confident that if we do these things we will achieve empowerment targets much more quickly and naturally than will be the case if we artificially interfere in market mechanisms, management autonomy and property rights.  The white population  cannot possibly provide the numbers of skilled workers, professionals and managers that a growing economy will require.  Inevitably, and quite rapidly, the South African economy will grow to reflect the population composition as a whole.

 

However, the economy will not grow satisfactorily if we do not appoint and promote people with appropriate skills whatever their race;  if we interfere with the ability of companies to manage their affairs;  or if we dilute property rights.

 

The third requirement for success during the coming ten years will be our ability to compete successfully in increasingly tough global markets.

 

The government has done well on the economic front precisely because it has consistently implemented economic policies that are in line with a tried, tested and successful global consensus.  If we wish to attract the investment that we need for growth and if we are serious about improving our competitive edge we must continue to play by the basic rules that govern the globalised economy.  Any attempt to dilute property rights, economic freedoms or basic standards of administration and management will relegate us to economic and developmental marginalisation.

 

Finally, if we want to achieve success during our second decade we must continue to work for reconciliation and national unity.   South Africa’s constitutional transformation has worked well, precisely because it was the result of negotiations and compromises – negotiations between parties that represented the great majority of all South Africans from all our communities.

 

The problem is that South Africa’s minority communities have not been sufficiently consulted with regard to economic and social transformation. They feel less and less represented in the processes by which they are governed and often perceive transformation as a new form of racial discrimination.  The majority on the other hand often regards it as a long-overdue rectification of the deep injustices of the past.

 

I am deeply concerned by growing alienation between our communities.  72% of white males now believe, rightly or wrongly, that affirmative action has turned them into second-class citizens in their own country.  70% of black South Africans believe that white farmers should be forced to sell their land.   Less than 25% of black South Africans agree that land owners should have the right to dispute land claims by going to court.  The indications are that inter-community tensions are increasing – and not decreasing – with the passage of time.

 

There is very little frank debate.  Many whites publicly express politically correct, but qualified, support for transformation – while they privately educate their children to work overseas.  The result is that too many whites are emigrating – either overseas – or inwardly into their own communities.  South Africa cannot afford to lose skills and commitment on this scale.

 

I am also deeply concerned by our failure to develop a vibrant multiparty dimension to our democracy. The 2004 elections confirmed that, at least for the present, the South African political scene will continue to be characterised by ethnic, rather than policy-driven, politics.   They signalled that, for the foreseeable future, South Africa will be a dominant party democracy in which the ANC will determine policy not only at the national level, but also in all the provinces and major cities.

 

This leaves us with a diminished democracy.  One of the central requirements for multiparty democracy is that the electorate should have the ability to choose between parties that have a reasonable expectation of winning an election.

Secondly, it means that South Africa’s minorities will continue to feel excluded from the processes by which they are governed.  The ruling party will take even less notice of its parliamentary opponents and will unfortunately continue to associate opposition criticism with the unwillingness of minorities ‘to accept the realities of the new South Africa.’   Under these circumstances the existing sense of disempowerment and alienation that is already evident in some minorities is likely to increase.

 

In these circumstances I believe that the focus of our national political debate will increasingly shift from formal constitutional structures to civil society.  The Treatment Action Campaign has already shown how effective civil society can be in confronting government on key policy questions.

 

We South Africans need to talk to one another about the challenges of our second decade. We need to work toward a national understanding that will enable us all to make the fullest possible contribution to achieving the vision in our constitution – the vision of a truly free, non-racial and equal society.

 

The stakes involved are very high.  Our ability to reach a balanced national consensus on the challenges that confront us will be a key factor in determining whether South Africa will become the first African country to join the ranks of the first world nations.

 

I am confident that we South Africans will rise to the occasion – just as we did between 1990 and 1994.  I believe that if we do so, South Africa in ten years time will be a much better country than it is today – and an infinitely better country than it was twenty years ago.