Economy, Vol.11 Issue 1 by The Cape Town Globalist

CAPE TOWN A P R I L 2 0 16

U C T â&#x20AC;&#x2122; S S T U D E N T I N T E R N AT I O N A L A F FA I R S M A G A Z I N E

ECONOMY

V O L .11 I S S U E 1

OPINION

The Cape Town Globalist is a member of

Global21

1 NETWORK LINKING FUTURE WORLD LEADERS

Network of International Affairs Magazines 5 LANGUAGES www.global21online.org 5 CONTINENTS

11 UNIVERSITIES 245 000 STUDENTS

Yale University • University of Toronto • University of Sydney • Hebrew University • Institut de Sciences Politiques • London School of Economics • Peking University • University of Cape Town • University of South Australia • Oxford University • Ibmec University 02 CAPE TOWN GLOBALIST • APRIL 2016

Editor-in-Chief Tshilidzi Neluvhalani

Contents

Content Editors Azi Mqatazana Megan Dyamond Sofia Monteiro Design & Illustration Daniel Rautenbach

Head of Marketing Prince Enoch Nwadeyi

NEWS

Newsbites

Finance Richard Mills

OPINION

Promoting investment in South Africa Sofia Monteiro

INTERVIEW

Q&A with Dr. Angier Megan Dyamond

OPINION

The Higher Education Funding Crisis Clayton Takawira

OPINION

Chinese Investment in Africa Alexandra Swanepoel

INFOGRAPHIC

South Africa in Numbers

OPINION

The Big Nationalisation Debate Mofeyisayomi Olagoke

OPINION

Can the U.S.A. afford a Trump presidency? Katharina Lindiwe Gensicke

OPINION

The Chicken Game Alicia Charmaillé

OPINION

Inequality Matters Azi Mqatazana

OPINION

BEE: Should the fundamental model change? Pahee Kaumbi

OPINION

Why unions joined Gordhan’s roadshow Terry Bell

PROFILE

Sibusiso Matsimela: The Bass Connoisseur

Secretary General Rutendo Bamhare Contributors Alexandra Swanepoel Alicia Charmaillé Azi Mqatazana Clayton Takawira Katharina Lindiwe Gensicke Megan Dyamond Mofeyisayomi Olagoke Pahee Kaumbi Sofia Monteiro Terry Bell

THE CAPE TOWN GLOBALIST is published by students at the University of Cape Town. Any opinions expressed are those of the authors and do not necessarily represent those of the Cape Town Globalist, the publication sponsors, the University of Cape Town or global21. To contact CTG, email ctglobalist@gmail.com or visit our website at ctglobalist.com.

Editor’s Letter

ECONOMY

Editor’s Letter The first issue of 2016 exits in a climate of political volatility and economic stagnation in the South African context. The rand hovering weakly against the US dollar and other major currencies, Inequality at unsustainably high figures, unemployment at 24.5% and the hiring and firing of three finance ministers just days apart from each other. It seemed fitting that the theme for this issue had to be centred on the Economy and related factors that influence social dynamics stemming from domestic and international policies. Inequality figures tell a sombre tale of the gap between rich and poor. For many that live in poverty, the reality and promise of a better standard of living still remains an unfulfilled promise, even after 22 years of the democratic transition. The Economic Freedom Fighters in their endorsement of the idea of nationalisation, have emerged as a collective that is garnering support, even if it is from a reasonably modest size of the voting populace. Having been part of the small group that successfully made it into a tertiary institution, common sense dictated that for an economy with aspirations of sustainable economic growth, a skilled labour force is a fundamental prerequisite to national prosperity. The student protests that successfully challenged the unsustainably high university tuition fees called into focus the funding crisis higher education in the country faces, the reality still remains that for the majority of students that have the opportunity to make the transition to higher education – funding still remains the biggest barrier. Abroad, the US election promises one of two outcomes if current polls are to be taken into consideration. Donald Trump may be the Republican Party nominee. His tell it like it is populist attitude draws media attention for most often than not, the wrong reasons –his comments on a total Muslim ban and immigration rhetoric. Hillary Clinton is expected to be the Democratic presidential nominee. Possibly becoming the first female president of the highest yielding economy on the planet. Depending on the outcome between Trump and Clinton, history will be made provided who comes out victorious. As a new feature, we introduced profile pieces that highlight achievements from students studying various disciplines within the University. This issue will profile Sibusiso Matsimela’s journey from a backroom drum bashing juvenile to a professional bassist touring the globe from his craft. Last but not least, I would like to thank the Editorial team and entire collective for their role in the creation of this issue, I remain thankful for all your contributions.

Tshilidzi Neluvhalani

ECONOMY

NEWS

NEWS BITES On April 14 2014 roughly 276 Nigeria’s Chibok girls were kidnapped and apparently only months later US and UK governments knew the location of about 80 of those girls. The information was passed on to the Nigerian government but ultimately the risk of a rescue mission was too high with many believing that only a few girls would survive the mission. The Boko Haram camps are said to have abducted countless others and all abductees are believed to be held in smaller groups under militant control. The supposed kingpin of Boko Haram has been arrested with an ongoing investigation into his actions as well as others.

The Iron Lady of Ivory Coast will go on trial in Abidjan on April 25 for crimes against humanity. This is despite the International Criminal Court requests for Simone Gbagbo to be handed over to them to stand alongside her husband in trial. She is being tried for her role in the post-2010 election violence which killed more than 3000 people. Gbagbo already faces a 20 year prison sentence from last year for attacking state authority in relation to the 2010 violence. Local magistrate declined to hand her over to the ICC arguing that the ICC principles are either local judgement or ICC judgment and that they are choosing local.

- ibtimes.co.uk

- iol.co.za

President Zuma has yet to dismiss claims that the Guptas – a wealthy business family – are the ones calling the shots and appointing cabinet ministers who will benefit their business. There are several claims from people formerly in positions of power who were fired due to their uncooperativeness with the Guptas and even replaced with someone less experienced but with closer links to the family. Gwede Mantashe, ANC secretary general, has made it clear that the ANC will not be dragged through the mud along with Zuma. Others caution that the investigation into the scandal will be a process but ultimately Zuma will have to go.

No one can forget mass murderer Andres Behring Breivik who killed 77 people, 69 of which were teenagers on at a Labour Youth camp, in Norway in 2011. Breivik has been held in isolation at Skien Prison for the past five years. Breivik has three cells to himself – a living courter, an exercise and a studying cell. He also has access to a TV, DVD player, gaming console, books, newspapers and a computer without internet. However his lawyers are claiming the state are treating him inhumanly saying that he has to endure countless strip searches and headaches caused by his isolation. Since his arrest his communication with the outside world has been strictly limited. Norway prides itself in its rehabilitation style prisons rather than punishment. A verdict for the dispute between his lawyer’s claim and that of the state is expected in about a month.

- theguardian.com

- iol.co.za

CAPE TOWN GLOBALIST • APRIL 2016

Genetic manipulation has done it again. This time scientists in the field have reversed evolution by “inhibiting early maturation of a leg of a chicken embryo” causing the leg to revert to a prehistoric dinosaur like leg. Doing so highlights the development of theropod dinosaurs – a carnivore turned omnivore – into birds more than 145 million years ago. When the research team of six in Chile delayed the early development of the embryos, the bone took the prehistoric dinosaur shape it once had. - nation.com

Salah Abdeslam, Europe’s most wanted man since the November 2015 attacks in Paris, has finally been arrested. This marks a blow to ISIS as Abdeslam is believed to be the last survivor of the team of ten attackers that killed 130 people and injured many more. Abdeslam was captured in Brussels and will likely be handed over to French custody. France has been undergoing a campaign against terrorism which has so far charged 37 people with 28 others in custody and with efforts to continue until terrorism is eradicated.

Can you imagine if the sun was 50 times the size it currently is and 30 million times brighter? NASA has recently discovered a cluster of a dozen stars at least 50 times the size of the sun, nine of which are 100 times the size. The stars radiate energy in the ultraviolet light range. Luckily these stars are a safe 170 000 light years away from our solar system nestled in the R136 star cluster. Scientists are trying to discover how such a star formed. This amazing discovery was only made possible to due Hubble. - theindychannel.com

What happens when the police are called because a suspicious bomb like noise can be heard from a recycling bin? In Modena, Italy, an entire street was shut down and a 650 foot area blocked off for just that. The bomb scare turned out to be nothing more than a buzzing sex toy that had been disposed of with batteries still inside. This marks the second scare for Italy after a pressure cooker filled with soup was left unattended on a train station platform. Luckily neither devices were the explosives they were mistaken as. - huffingtonpost.com

- news24.com

They obviously did not realise how expensive camera equipment is. Two young jovial panda cubs were filmed tumbling down hill and having what appears to be a ton of fun. However the fun footage takes a turn for the worse when one of the pandas spots it and decides to see what sort of food it has found. Not only does one of the pandas try eating the camera but they also end up punching the expensive equipment. - huffingtonpost.com

Allison Schafer reminds us why she is the Bacon Queen by firing up a side of bacon. The Blue Ribbon Bacon Festival, Iowa Queen wrapped bacon and aluminium foil around the barrel of an AR-15 rifle and fired a few rounds. Ultimately making crispy gun-fire smoked bacon. Seems familiar? Well it should. Last year presidential hopeful Ted Cruz made his bacon on a machine gun before eating it as part of his campaign ad. One has to wonder what will be the next wacky way to cook bacon. - huffingtonpost.com

ECONOMY

OPINION

Promoting investment in South Africa Sofia Monteiro investigates the Promotion and Protection of Investment Bill that President Zuma quietly signed into law in December 2015. Is this Act merely an update to outdated bilateral treaties or could it worsen foreign investors’ anxiety about the future of their businesses in South Africa?

t the 2016 World Economic Forum in Davos, Switzerland, President Jacob Zuma pitched South Africa as an attractive opportunity for foreign investment. The response was lukewarm. Less than two months before, Parliament approved a controversial bill that has some worried that new foreign investors will think twice before choosing South Africa. “This is a big neon sign on the shop front window of South Africa that screams: ‘Closed for business.’” said DA Member of Parliament Geordin Hill-Lewis. While opposition parties and the American Chamber of Commerce in South Africa voiced their anxiety, Minister of Trade and Industry Rob Davies staunchly defended the Protection of Investment Bill. “South Africa, through this Bill, is indicating that we will provide and continue to provide strong and reasonable protection to investments in accordance with the Constitution”. Unlike previous bilateral investment treaties signed into law after 1994, this bill ensures no more special privileges for foreign investors in South Africa. Treaties with European countries were the first to be annulled. One commentator in The Daily Maverick noted the decided lack of haste in dissolving similar bilateral trade agreements with Russia, Cuba, China and other African countries. What does ‘protecting’ investment look like? The Act aims to protect (in other words, regulate) all investment “in a manner which balances the public interest and the rights and obligations of investors”. It affirms the right to property of foreign investors in terms of Section 25 of the Constitution (the property rights clause) and states that they must not be treated less favourably than local South African investors.

CAPE TOWN GLOBALIST • APRIL 2016

For example, foreign businesses will be subject to the same environmental and BEE requirements as local firms. Sounds fair, right? However, one section of the Act hints at future intervention by our government in the ownership and operation of business. For example, it asserts that any organ of state can take measures that include “redressing historical, social and economic inequalities and injustices” in order to work towards the realization of socio-economic rights. It allows for the Minister of Trade and Industry (currently, staunch Bill defender Davies) to devise any regulations deemed necessary. The Bill was lauded by its supporters for upholding equal treatment of investors. Yet, to paraphrase George Orwell, it appears that some are more equal than others. The Bill provided for special investment agreements with our current pals China, Iran, Cuba and Russia. Along with Rob Davies, Pravin Gordhan can also claim the contentious honour of Godfather to this Bill. During his first stint on the job, Minister of Finance Pravin Gordhan was quoted in the Business

Day blaming “lawyers serving the private sector” for “trying to increase uncertainty in an unfounded way”. This was back when the draft bill was released in 2013. Shortly after the Bill was signed into law by President Zuma in 2015, our former Finance Minister Gordhan was returned to the post (following the four-day reign of Van… does anyone remember his name?). Perhaps Minister Gordhan forgot that these impertinent lawyers’ job is to question the government that may threaten their clients’ interests under the premise of whatever loosely fits “the public interest”. Pointing out that the Bill is in line with our revered Constitution is still no comfort to foreign investors. The Constitution itself provides for asset expropriation and state intervention in ownership of businesses. South Africa is competing with other emerging economies in a global market for foreign investment. Foreign investors are searching for gestures by government that indicate certainty. Unsurprisingly, they want assurance that their capital will be secure once they invest here.

ECONOMY

OPINION 10

CAPE TOWN GLOBALIST â&#x20AC;¢ APRIL 2016

Perception is everything when it comes to investor confidence. In order to analyze the long-term impact of the Bill, we have to consider its context. For example, power cuts jeopardizing energy security, a currency that has lost fifty percent of its value to the dollar, and the possibility of a downgrade of South Africa’s investment rating to junk status. This, and more, is likely to filter into the assessment of the Bill by foreign investors – however well intentioned its Godfathers may have been. Potential unintended consequences will only be felt eight to ten years down the road. Executive director of the American Chamber of Commerce in SA, Carol O’Brien, argued that it is ingenuous to say that BMW’s recent investment in South Africa is proof that foreign investors are not deterred by the bill. Decisions to invest are made years in advance of their eventual announcement. The Romans knew a thing or two about the problem of holding power to account. Quis custodiet ipsos custodes - “Who will watch the watchmen?” In the case of this Bill, which gives government new powers to intervene in business, we might ask: “Who will regulate the regulators?” I mentioned to some of my friends that I was writing an article about the Protection of Investment Bill and asked what they thought about it. The overwhelming response was “Never heard of it…” Whether we end up deciding that this Bill will positively or negatively affect our economy, we should at least interrogate it. After all, we are the ones who will feel its effect in the long run – as new entrants to the labour market, as business owners at home and abroad, and as citizens in a struggling economy. So feel free to congratulate yourself for spending ten minutes reading up about that Bill you had never heard of. Disclaimer: as this article goes to print, Pravin Gordhan is still Finance Minister. This publication cannot be held responsible for incorrect job titles resulting from unanticipated cabinet changes at the discretion of The President. Sofia Monteiro is a candidate for Master of Social Science in Applied Economics.

Image: Reuters

ECONOMY

INTERVIEW

Q&A with

Dr. Angier

South Africa as a country is rife with issues of democratic failings and failings of the justice system, and although since becoming a democracy in 1994 we have experienced many triumphs, there is still much controversy and debate concerning South African politics. In the following dialogue, Megan Dyamond talks to Dr Angier of the University of Cape Town’s Philosophy Department responds to and discusses, within a philosophical framework, concerns and issues regarding South African democracy.

Megan Dyamond: What, traditionally, are some of the philosophical notions concerning a democracy and what it should be? Dr Angier: I largely work in ancient philosophy, and what is noticeable is that at the beginning of the tradition there is an attack on democracy, particularly by Plato and Aristotle, who view it as a chaotic system of government driven by popular desire. For them, democratic society ultimately collapses and falls into a tyranny, needing a strong leader to maintain control. This analysis is very pessimistic in my opinion, although some people are currently saying that Plato was right, as now we see a return of a desire for a strong leader who can maintain control over competing forces in society, particularly in states such as Russia and the USA. This is a fairly new thing in modern times, to criticise democracy this way. However, I would say that Plato and Aristotle underestimate popular intelligence and popular reasonableness. People don’t just have desires, they also have reflective desires and can be reasonable in acting on their desires. Democracy, particularly Western democracy, is able to selfcorrect and improve. Megan Dyamond: Would you say that South Africa is driven by popular desire? Dr Angier: No I don’t think so. Although South Africa, as far as I can tell, is essentially still a oneparty state, which is anti-democratic because you have this lack of public choice and also

debate to some extent. When the overwhelming majority is always going to favour one party, this demotivates the rest of the population from engaging politically. Megan Dyamond: In traditional democratic theory many philosophers concur that one of the state’s roles is the protection of its citizens, do you think South Africa is failing or not paying due attention in this regard? Crime and a lack of education seem inescapably linked, while South African policies may have a focus on reducing crime, they seem to fall short in reducing its root causes. Dr Angier: In a sense the government is clearly failing in its duty to protect its citizens, as there are huge problems of inequality, crime and poverty. Perhaps it would be better to say that, 20 odd years away from apartheid, we are not yet in a situation where economically, people are in a position to fend for themselves. Having enough is an incentive to avoid criminal activity. Even with the best of security mechanisms, a population without economic autonomy will often see the knock-on effects of poverty. Megan Dyamond: On our justice system: there seems to be a failure specifically regarding rehabilitating inmates and regarding paroles. There are many cases where offenders are paroled, having served as little as 1/6th of their sentence, only to commit more (often violent) crimes. Although due to the nature of inequality and poverty that many South Africans face, those

CAPE TOWN GLOBALIST • APRIL 2016

released after having served time may find it difficult to assimilate into society without resorting to crime. Dr Angier: Yes, violence cannot be excused, although most do resist committing violence. But on the other hand when you’re constantly bombarded with people who have so much more than you it can be very frustrating. The fact is that for the majority of people crime is not a daily occurrence, and although many face constant insecurity, actual attacks are not part of people’s everyday life. I think the upshot of all this is that we can never improve things until the basics are improved; that is: basic education and better economic prospects for the majority. Megan Dyamond: Regarding South Africa’s international policy. The failure to arrest Sudanese President Omar al-Bashir for crimes against humanity in 2015 particularly appears to be a failure of our democracy, a failure to uphold democratic values. Dr Angier: Well yes, although this is a highly complicated issue. The idea that you can pin-point a leader as a criminal and then institute justice against them, is very attractive but also, in my opinion, dangerous. Because it depends on the current norms of international politics. Who is identified as a criminal? It tends to be leaders from poorer 3rd world states. European and Western leaders, nowadays, would never be identified in this way. It is certainly necessary to depose leaders such as al -Bashir, but I would say it’s the duty of his people to depose him. It’s too ambitious for any external states to be absolutely authoritative on who should be detained and who should not be. Megan Dyamond: Concerning the responsibility of the people of the state in determining their own leader; this autonomy could also perhaps prove beneficial in building themselves into a nation of their choice without external interference. Dr Angier: Indeed, you could run a sort of postcolonial critique on this issue, as the attempt of the international community to police all other communities in the world. Effectively though, the policing would realistically be done by Western countries. I am not at all in favour of al-Bashir, but I’m not sure that he should have been detained. Megan Dyamond: On the subject of our president, President Zuma’s history is very controversial, many democratic thinkers would think it hardly just for a leader to have 783 counts of corruption, moneylaundering and racketeering dropped. One might wonder how 783 counts, a significant number, can be dropped (or even raised at all) without there being

some cause. For many democracies in the world, if a leader were to even be accused of such a thing, it’s doubtful he would remain in that position long. What do you think this says about the South African justice system? Is it truly democratic or shifting into something else? Dr Angier: There is an element of tyranny in the immunity of the leader, which President Zuma seems to possess. Of course SA is not a tyranny, but it is worrying for such a thing to occur. I think it is a dysfunctionality in the legal system that’s allowing this. One of the key pillars of democracy is that it puts its leaders under the same constraints as all other citizens, in most ways at least. The powerful have to be reined in. Although I would say, and I think this follows Archbishop Tutu’s way of thinking, that in some ways President Zuma is inheriting structures of entitlement from the apartheid days and he’s abusing his power. It’s not as if this behaviour comes out of nowhere, during apartheid it’s possible that a lot of financial corruption was covered up, and there was a distinctively hierarchical, authoritarian system of government. I think Zuma has inherited some of these structures, so that the legal profession is not willing to challenge his power. One could make an analogy to Russia. Why is it that Russia has this “strong man” quasi-tyrant in power? And why were the communist leaders, against all their best principles, similar? If you look at the Tsarist regime of the 19th century, it was a tyranny, and once overthrown the succeeding governments inherited some of its structures, such as a secret police. It’s very difficult to completely alter a social structure overnight, and as I have said, we are only 22 years away from apartheid, less than a generation. So my tendency towards this issue in South Africa is to bear in mind that we are less than a generation from a quasi-fascist regime. There has not been enough time to completely change these structures. There is not yet a generation which has fully experienced the opportunities its predecessors had not had, so it will take some time to change the social structures in question. Some of the key points of this interview are: that the root causes of crime and insecurity in South Africa need aggressive attention in order to remedy their effects, that the South African government and ruling party should better enforce and streamline its policies to reduce corruption, and that our social and political attitudes and structures require time (and significant effort) in order to improve. Megan Dyamond is a third year student studying BCom (PPE). ECONOMY

OPINION

The Higher Education Funding Crisis by Clayton Takawira

015 saw widespread protests across higher education campuses. The #feesmustfall campaign was used to rebel against the high costs of tuition fees in universities across the country. Originating from Wits University, the collective student protests spread to other provinces and tertiary education institutions. Students were simply dissatisfied with the unsustainable and unaffordable cost of education. Many argued the high fees serve as a barrier for the poor in accessing tertiary education. Without funding which amounts into the tens of thousands, students from poor backgrounds and those with limited financial means simply cannot afford to study at some of the nation’s premier institutions. The question thus arises: to what extent can higher education truly be free and who ultimately will be liable for the underlying cost? Government has a scheme to aid qualifying students financially, the National Student Financial Aid Scheme (NFAS) model is loan based, depending on academic results. The scheme issues loans with a portion of the loan to be transferred into a scholarship. The scheme is commendable, but serves just a small percentage of those who qualify to pursue a tertiary degree or diploma. The funds allocated to the scheme cannot provide for anywhere near the amount of applicants who require financial assistance. The reality is that for many of those with the most financial need, the scheme is their only option to attain funding, since security backed bank loans require exactly that – security and collateral. According to a study by PwC, from 2010 to 2012 tuition fees at the 23 public universities in South Africa increased from R 12.2 billion to R 15.5 billion, while enrolments only increased by 7% during the period. At the same time, student debt rose from R2.6 billion to R 3.4 billion – an increase of 31% over two years. The question of free education thus is posed: is it economically viable for the country to exercise free tertiary education? Depending on one’s ideals the answer varies. For those who believe in a socialist state where the country’s resources are

CAPE TOWN GLOBALIST • APRIL 2016

“The National Development Plan (NDP) requires the higher education sector to increase enrolment levels annually from 950 000 in 2010 to 1.6 million by 2030.”

2030 2010

distributed accordingly for the betterment of collective society, then yes –a socialist structure of funding higher education would in theory provide for education to be free to students and those that qualify. A re-distribution of the national budget to further invest more capital into the NFAS scheme is another possibility, in theory again. Funds added would address the shortfalls the structure struggles with, on an ongoing basis. Another possibility is to create some sort of tax based model that funds higher education fees. The problem though would be that it would be unfair to expect everyone in society to be taxed to contribute to the funding of a particular group of people –those few that qualify to enter higher education institutions. In reality, a large majority of the country’s populace remains unskilled and working in jobs that require little or no skill at all. Hence in reality, the capitalist system the country operates under dictates that someone ultimately has to foot the bill –be it government or through some private investment made into the education sector. The future for funding higher education in South Africa is articulated by the National Development Plan. The National Development Plan (NDP) requires the higher education sector to increase enrolment levels annually from 950 000 in 2010 to 1.6 million by 2030. The cost of delivering university education in South Africa amounts to around R50 billion annually. South

Africa uses a funding framework in which costs are shared among the beneficiaries of university education (mainly government and students). Unless a way is found to decrease the cost to deliver higher education, an increased enrolment as required by the National Development Plan will require a corresponding increase in funding. In conclusion: in a dynamic country where skills define the odds of getting employment, in a country with such an unequal society, in a country with a growing youth populace, higher education accreditation has the possibility to change the circumstances of so many. The problem with the funding crisis is so deep that without any sort of sustainable funding model, many will simply not be able to afford the costs of tertiary institution tuition fees. And for the National Development Plan on education to be realised, increased funding will need to be a reality. The reality is, the current funding crisis has to be addressed efficiently and effectively. This will, depending on the outcome and success of the policy, have underlying and direct effects on the economy of the country –ultimately affecting all who live in the borders of South Africa. Clayton Takawira is a third year BSocSc student majoring in politics and sociology.

ECONOMY

OPINION

Chinese investment in Africa Alexandra Swanepoel investigates the implications of Chinese investment in Africa and how the media shapes our perception of China-Africa relations. frica-China relations are long-standing, murky and complicated. China is the African continent’s largest trading partner, dating back to the 1950s with the first official bilateral trade agreement and the 1990s seeing a 700% trade increase between the two regions. There has been extensive media coverage of new trade deals brokered between the two in recent months, which has resulted in severe criticism and prompted the question of whether Beijing is beginning to exert too much political, economic and military power in Africa. Is the general perception that China is attempting to take over Africa the correct one? There are several widespread misconceptions about China’s involvement in Africa that continue to be propagated by the media, and damaging to our views on the matter. That China’s only interest is to exploit Africa’s natural resources, secure oil concessions and hold mining rights; that the workforce of Chinese companies is not localized; and that China is the “biggest land grabber” in Africa, forcing the continent into a new imperialist age. However, China-Africa expert Professor Deborah Brautigam of John Hopkins University School of Advanced International Studies (and many others) has refuted these distortions, instead holding that the creation of imaginary problems such as these forces the focus away from the real issues such as the need for better engagement, transparency and sustainability measures. Currently it seems that Beijing is reevaluating the degree of risk it is willing to take in Africa. However, it will continue to be a significant source of foreign direct investment (FDI) in Africa well into the future. At the sixth Forum on China-Africa Cooperation held in Johannesburg in late 2015, Chinese President Xi Jinping signed into being multiple investment and business deals. The total loan and aid amount pledged is $60 million over a three-year period. Trade agreements such as these as well as the financing of infrastructure initiatives have helped to boost the continent’s

CAPE TOWN GLOBALIST • APRIL 2016

growth rate considerably, but have also lead to the media’s inflation of the extent of Chinese investment in Africa. Despite rapid growth, FDI by China actually accounts for only 3% of Africa’s incoming FDI overall. The U.S. remains Africa’s largest and most attractive economic partner due to better working conditions, higher technology transferal and higher purchasing levels of local products. One of the most interesting causes of this inflation is extremely intuitive. Both Western and Chinese investment are drawn towards natural resource wealth. Western investments tend to be highly concentrated in countries that practice good governance. However, China invests in both good and poor governance environments, as it remains largely indifferent to countries’ legal and socioeconomic superstructures. China’s investment share in many poorer countries is therefore higher. The Western world is one of the leading critics of China-Africa relations. The accusations focus on the imbalance of power relations and human rights abuses by China – and that China is ultimately engaging in neocolonist practices in Africa. It can be argued that this is based on China’s support and giving of aid to African Independence Movements and newly independent countries during the 1960s and 1970s, as well as longstanding Western bias and economic competitiveness with Asia. However, some credence must be given to these criticisms. Certain trade agreements have been dubious at best, including China’s supplying of arms to Zimbabwe and its supportive economic relationship with Sudan. A new Chinese naval base is due to be built in Djibouti. China’s recent economic downturn has also clearly demonstrated the grave impact the Yuan can have on local economies. Is this the high cost the African continent should learn to expect from Chinese investment? It is obvious that Beijing desires resource control, investment return and political loyalty. However, Chinese investment in Africa is full of gains. For example. Beijing does not impose political obligations in order for contracts to be entered into and it is willing, unlike the U.S., to enter the more unstable parts of the region. If Africa endeavors to become a more powerful global economic force, the continent has to continue forging diplomatic ties with one of the world’s leading superpowers – but it alone bears the responsibility to remain accountable to its people. Alexandra Swanepoel is a third year postgraduate LLB student.

ECONOMY

OPINION

Alex Sw

CAPE TOWN GLOBALIST â&#x20AC;¢ APRIL 2016

wanepoel

Jacob Zuma and Chinese President Xi Jinping. Image: Reuters

ECONOMY

INFOGRAPHIC

SOUTH AFRICA IN NUMBERS Courtesy of Stats SA

Population – 54,96 million GDP – R4,0 trillion Headline inflation – 6,2% Economic Growth (real GDP) - 1,3% 3 Capitals - Pretoria, Cape Town Bloemfontein

10%

SA Economy

51,3% Female

21%

69%

Primary Sector 20

84,7% have access to electricity

Secondary Sector

Tertiary Sector

CAPE TOWN GLOBALIST • APRIL 2016

48,7% Male

73,4% have access to piped water

DA 22,23%

2014 National Election Results

EFF 6,35%

ANC 62,15%

Other 9,27% 28,5% households have access to a vehicle

Working Age Population (36,3 million) Employed - 16 million Unemployed- 5,2 million Not economically active - 12,8 million Discouraged wokers - 2,3 million

ECONOMY

OPINION

The Big Nationalisation Debate Mofeyisayomi Olagoke explores the viability of the concept in reference to the Economic Freedom Fighters’ endorsement.

he Economic Freedom Fighters are a party that successfully garnered enough votes in the general election to be considered a genuine voice for the constituency they represent. Although very vocal in parliamentary sittings, the demands and ideals they articulate appear to be in line with the ideals of many South Africans who struggle to make an honest living in an economic environment that is not favourable to the poor. With a struggling economy, volatile and questionable political decisions by the executive; serious corruption problems within the structures of government and objectively linked spheres of influence –the most marginalised are finding it more and more difficult to survive in an environment that promotes capitalism and related concepts. The rise and ideals of the concept of nationalisation is thus an area most have argued should be explored (including the EFF in most major private sector transactions). Free education, substantive land reform and the nationalisation of major sectors that generate income for the country. The question that is often prominent in the nationalisation debate is then posed: can a move towards nationalisation solve most of our problems and help deliver a better standard of living to the population? The idea of nationalisation involves the process of transforming private assets into publicly owned ones. This is achieved by bringing such assets into the ownership and control of a national government. Being the clear advocate for nationalisation in the South African context, the EFF spearheads the debate on transforming the economy to align with the ideals and fundamentals of nationalisation. According to the Electoral

CAPE TOWN GLOBALIST • APRIL 2016

Image: Economic Freedom Fighters

â&#x20AC;&#x153;

Statistics South Africa shows that current unemployment is sitting at 24.5% and significantly enough the poverty headcount is at 56.8%. These figures are unbefitting of an economy our size given that the economy is the second largest on the Continent in terms of GDP

â&#x20AC;?

ECONOMY

OPINION

Commission of South Africa, the party registered third in the 2014 national elections with 6.35% of the national vote in their favour. Third for a party that is relatively new shows that the population (at least 6.35% of it), is desperate for some sort of structural reform in terms of national policies. Another issue at large in the country is the rising inequality gap between rich and poor. The 1996 final constitution and highest law in the country makes for provisions that promote a re-structuring of the injustices of the past. This is through a recognition of liberal subjective rights such as the right to housing, healthcare and other rights that promote a tangible standard of living for the most marginalised in society. The Bill of Rights (s2) provides a tangible framework for government and other stakeholders to follow. The constitution also makes provisions for redistributive measures in the form of Broad-Based Black Economic Empowerment. One could argue that some of the provisions the constitutions allows for, are in line with socialist ideals that benefit all in the country without the need and implementation of other concepts such as that of nationalisation. Statistics South Africa shows that current unemployment is sitting at 24.5% and significantly enough the poverty headcount is at 56.8%. These figures are unbefitting of an economy our size given that the economy is the second largest on the Continent in terms of GDP. Some might argue it is circumstances beyond our control such as the lack of investment that has contributed to the dire state of affairs in most sectors. An argument might even be made based on the exact same facts that a shift into a nationalist framework might benefit the country for the better, not in terms of say GDP growth but for the betterment of society in general â&#x20AC;&#x201C;the population. An opposition to capitalism can be argued as a way to offer long lasting and effective economic change for the people.

CAPE TOWN GLOBALIST â&#x20AC;˘ APRIL 2016

The EFF policy on nationalisation calls for the following provisions:

Nationalisation of mines, banks and other strategic sectors of the economy. 1. Owing to the character of the South African economy and the aspirations of the people for economic freedom, state ownership and control of strategic sectors of the economy should be the foundation for sustainable economic transformation in South Africa. A supposition that the South African economy can be transformed to address the massive unemployment, poverty and inequality crisis without transfer of wealth from those who currently own it to the people as a whole is illusory. The transfer of wealth from the minority should fundamentally focus on the commanding heights of the economy. This should include minerals, metals, banks, energy production, and telecommunications and retain the ownership of central transport and logistics modes such as Transnet, Sasol, Mittal Steel, Eskom, Telkom and all harbours and airports. 2. The ownership of mineral wealth should be considered through various means, prime being the expropriation of the current minerals-production processes in South Africa, and the commencement of extraction, processing and trade on new land 3. The benefits of nationalising strategic sectors of the economy will include, but not be limited to, the following realities: An increased fiscus for, and therefore more resources for, education, housing, healthcare, infrastructure development, safety and security and sustainable livelihoods for our people. – More jobs for our people because state-owned and controlled mines will increase the local beneficiation and industrialisation of mineral resources. This will, in turn, reduce the high levels of poverty consequent of joblessness.

– More equitable spatial development because stateowned and controlled mines will invest in areas where mining is happening. – Better salaries and working conditions in mines because state-owned mines will increase the mining wage and improve compliance with occupational health and safety standards. – Greater levels of economic and political sovereignty, as the state will be in control and ownership of strategic sectors of the economy, which produce mineral resources needed around the world. 4. The EFF-led government will establish a State Bank, which should be accompanied by the transformation of the financial sector as a whole, particularly banking and insurance industry practices and norms 5. The EFF will limit foreign ownership of strategic and monopoly sectors, where the state does not exert full ownership, in order to protect South Africa’s sovereignty and to limit the repatriation of profits, so that these can be used for the further development of our people In essence, the discussion on nationalisation will be one that will be debated for years to come now that vocal backers of the ideal have a voice in parliament. Depending on which side you sit, it is hard to ignore the facts and the dire way in which the majority of the population have to live under. A redress into viable ways and mechanisms to change the standard of living for the most marginalised will be required if any change is to be realised. Mofeyisayomi Olagoke is studying acturial science.

ECONOMY

OPINION

Can the U.S.A. afford a Trump presidency? Katharina Lindiwe Gensicke focuses on Donald Trump’s comments on a total Muslim ban and on immigration.

hoever has not heard of or read about the increasing support for the wellknown Donald Trump is receiving in the United States of America’s 2017 presidential race is definitely living under a rock. The previous jokes on 9gag and Facebook about his presidency have turned to surprised shock at the impending reality of his possible chance at the White House. What would having a President Trump mean for the United States of America? Donald John Trump was born in 1946 to Frederick Trump and Mary Trump, a family working in the real estate industry. He attended the New York Military Academy then entered Fordham University and lastly transferred to the Wharton School of Finance where he graduated in 1968 with a degree in Economics. In the early 1970’s Donald Trump, like his father, entered the real estate industry by focusing his energy and negotiating skills on his first hotel the “Grand Hyatt” in Manhattan. What really established his name in real estate and the hotel business was the building of the well-known fifty-eight-story “Trump Towers” in 1982. Yet the “Trump Towers” pale next to his world-acclaimed golf courses, countless apartment buildings, luxury hotels and resorts, his well-known T.V. show “The Apprentice” and his six published books on economics and the state of The United States of America. Not only is he highly successful but so are his five children that are involved in business, real-estate and the sales of luxury items and fashion. Since Trump’s announcement in 2015 that he would run in the presidential elections, Trump has embarked on a rigorous but controversial republican campaign trail. Donald Trump uses his background as a successful business man and real estate mogul to his advantage by openly stating that he is not running as a politician but as a business

CAPE TOWN GLOBALIST • APRIL 2016

Image: Dominick Reuter

ECONOMY

OPINION

man. He believes that his business abilities and economic intellect can propel America forward, unlike his Democratic opposition – Hillary Clinton. The USA has not had a presidential candidate quite like Donald Trump. Moreover the country has not had a candidate gain such increasing amounts of support for his controversial and radical statements. He openly advocates against “political correctness” and against the “incompetency” of the current government. The topic of immigration and his immigration policy is not only fundamental to his presidential campaign but also key to his controversy. He believes that illegal immigration is affecting the American economy negatively, due to immigrants adding to crime and receiving state benefits such as; accommodation, temporary jobs and healthcare. “We have a country. Our country is going to hell. We have to have a system where people are legally in our country” – Donald Trump, 2015. This statement sounds plausible and very promising to “Make America great again” yet logistically and economically, is it viable? What would this “greatness” look like? It is not as simple as just building a wall, as this does not consider the already present illegal immigrants in the USA. The policy making institution American Action Forum estimated that the cost to deport and enforce the present immigration law would cost $600 billion dollars. This cost just takes into consideration the implementation of the law but does not take into consideration the losses the American economy will take in regards to labour loss. America is currently employing close to 11 million immigrants as cheap labour, especially in the agricultural sector, it is thus estimated that the GDP will fall by $1.6 trillion dollars were these immigrants to be deported. Trump’s immigration policy came with further controversial comments, the following announcement was made in June 2015 at one of his campaign rallies: “When Mexico sends its people, they’re not sending the best. They’re sending people that have lots of problems and they’re bringing those problems. They’re bringing drugs, they’re bringing crime. They’re rapists and some, I assume, are good people, but I speak to border guards and they’re telling us what we’re getting.” This statement not only sparked outrage from the Mexican citizens and government officials but many republican candidates and dominant business people commentated - they were furious with the statement. It was labelled as; “racist”, “inflammatory” and “incorrect”. Many advocated for it to be withdrawn and apologised for, some

CAPE TOWN GLOBALIST • APRIL 2016

businesses withdrew their sponsorship and business contracts with Trump. He never withdrew the statement, further adding to it by stating that he will build a wall on the American and Mexican border. This might sound like a frivolous statement but the many times that he has been questioned on it he has articulated his past successes in real estate and building. He even has a “plan” for the payment of the wall – he wants Mexico to pay. The Mexican government has condemned the statement, yet Trump has outlined that: “We have a trade imbalance of $40 billion, $45 billion with Mexico a year. We give Mexico billions of dollars a year. The wall is going to cost $6 billion or $7 billion”- Donald Trump, 2015. What draws mounting support for his policies is his concentration on being honest, direct and not “politically correct” like the “other” politicians This brings us to a second controversial statement and stance he has on immigration On the 13th and 14th of November, three coordinated attacks carried out allegedly by the ISIS terror group in Paris; targeting a concert hall, stadium, restaurant and bars, killing over 130 people and injuring 368 other civilians. It must be noted that at the time of the attacks there was, and still is, an influx of fleeing Syrian and West African refugees that have been largely accepted by Germany. In this context, Trump released a public statement in early December regarding the Paris attacks and furthermore commenting on President Obama’s plan to allow several 100 000’s of Syrian refugees in

America. He called for: “[A] total and complete shutdown of Muslims entering the United States until our country’s representatives can figure out what is going on.” He further cited a contested survey conducted in America by the right-wing Centre for Security Policy which stated that: “25% of those polled agreed that violence against Americans here in the United States is justified as a part of the global jihad.” This statement brought incomprehensible criticism and even a backlash against Muslims living in America through the vandalising of several mosques and many threats against individuals and groups of Muslims. He refuses to apologise or retract his statement, furthermore stating that: “Until we are able to determine and understand this problem and the dangerous threat it poses, our country cannot be the victims of horrendous attacks by people that believe only in Jihad, and have no sense of reason or respect for human life” – Donald Trump, 2015. As we all watch the primary elections with bated breath and in 2017 wait for the final announcement, it is best I leave you with his famous slogan: “If I win the election for President, we are going to Make America Great Again.” Katharina Lindiwe Gensicke is a BsocSc student majoring in Economic History, Politics and German.

ECONOMY

OPINION

The Chicken Game Alicia Charmaillé explores the impact of welcoming US chicken imports on the South African market and local business.

outh Africa is now the proud or not so proud home to American chicken. This marks the first time in 15 years that we as a country will be importing US chicken. Last year President Obama announced that if the African Growth and Opportunity Act (AGOA) would not lift its health restrictions and allow the US to export poultry, beef and pork by January (later extended to March) it would end the duty-free entry of South African citrus and wine into the US. We have received 907 kg of US chicken thus far, with more to come over the next nine years. US ambassador to South Africa, Patrick Gaspard, claims that they are aiming to develop black entrepreneurs to improve South Africa’s economy through the chicken trade. This has supposedly been worked out and set up by the Department of Trade and Industry (DTI); Department of Agriculture, Forestry and Fisheries (DAFF); South African Revenue Service (SARS) and the International Trade Administration Commission of South Africa (ITAC). Yet many question how paying farmers overseas to farm, kill and package a product that we have been producing locally for many years will help our economy. Could this undermine South African farming businesses? Not to mention US packaged chickens will be almost two months old by the time they reach our shelves. According to the President of the US National Chicken Council approximately $100 million profit will be made by US farmers on this deal and South Africans

CAPE TOWN GLOBALIST • APRIL 2016

will now be able to buy and enjoy quality chicken at a good price - suggesting local isn’t so lekker. US poultry, beef and pork arriving in South Africa could mean the end to thousands of livelihoods as farmers and their employees will be affected. Geoffrey Anderson the CEO of Mikon Farming believes that what South Africans will be receiving is essentially the US “dump.” He explains that the US does not have a market for the thigh or drum of a chicken and thus it becomes a surplus by-product which they can shift out and dump in South Africa for a profit. He goes on to explain how South Africa is experiencing a rising cost in the production of chicken products and now with increased international competition there is a high chance that local farmers just will not be able to keep up. This might push more local farmers into injecting chickens that they have bought from international markets and re-selling

them to us, a practice already in motion. This would still mean the end for many local businesses and a large decrease in the quality of chicken available to South Africans. This is not the only worry we face. There were claims that the US Food and Drug Administration (FDA) found up to 70% of US chickens sold to the public contained arsenic, a cancer causing and potentially lethal drug. Arsenic has been used to kill rats but chronic exposure such as digesting it through chicken containing it may cause Type 2 diabetes, neurological defects in unborn children; mental defects, heart problems as well as cancer. One reassuring thing in the midst of this chicken game is that we can expect a complete withdrawal of arsenic from the US market in 2016. Alicia Charmaillé is an Honours student majoring in historical studies.

ECONOMY

OPINION

Inequality Matters By Azi Mqatazana. he issue of inequality in South Africa is one which strikes a nerve. Economic disparities between the rich and the poor continue to stay high despite the fact that people are constantly promised elevated economic conditions. Economic inequality consists of disparities in wealth and income, usually referring to the differences in wealth and income among individuals and distinct groups within a society. In most cases the issue of economic inequality is closely related to ideas of equity, meaning that to determine the level of inequality one also has to look at equality of outcome and equality of opportunity. According the Boundless Sociology Group there are various numerical indices for measuring economic inequality, however the one that is used the most is the Gini coefficient. The Gini coefficient is a statistical measure that is used to investigate the dispersal of wealth and or income in a population. Gini coefficients lie between 0 and 1, where 1 means that all the wealth is held by an individual group. Most countries have a middling Gini coefficient, meaning that the levels of inequality are fairly substantial in many countries Contrary to other developing countries, the South African inequality margins have hardly changed despite the fact that there has been an introduction of social transfers (social grants, old age pension, disability grants and so on) that now reach 16 million poor South Africans. Inequality remains high in this country partly because the number of jobs created government over the past twenty years have barely kept pace with increasing numbers in the labour force. As a result, Professor Keeton of Rhodes University states in his article Inequality in South Africa that the true level of unemployment remains between 25% and 35%. The transfer system employed by South Africa only provides for children from poor households, the elderly and the disabled. No provisions are made for the unemployed. So what we end up seeing in South Africa is that inequality is caused by both the high wage inequality in the work place and by those who are unemployed. The question of an increase in taxes on the rich surfaces here. What if social transfers were increased to improve income distribution by raising the taxes on the rich? In his article Professor Keeton puts it’s plainly that this doesn’t make much of a difference in the grand scheme of things. But what does this mean for the poor? Do they just sit still and wait for the government to stop negligently using the money which they are entitled to? Do they wait for the rich to decide to give some of their wealth away? What can the poor themselves do to improve their own circumstances?

CAPE TOWN GLOBALIST • APRIL 2016

Clearly the manner in which our capitalist market is made up, simply excludes them. This raises the issue of land distribution. The predominantly black lower and lower-middle class should not be taken for granted when experts say land redistribution is the key out of poverty, clearly South Africa is failing these groups in this and many other regards. In 2012 a report by the World Bank unsurprisingly reports that among South Africans there are profound differences in life opportunities, these differences were found in race, location, gender and household income. The report notes that: “An equitable society would not allow circumstances over which the individual has no control to influence her or his basic opportunities after birth. Whether a person is born a boy or a girl, black or white, in a township or leafy suburb, to an educated and well-off parent or otherwise should not be relevant to reaching his or her full potential: ideally, only the person’s effort, innate talent, choices in life, and, to an extent, sheer luck, would be the influencing forces. This is at the core of the equality of opportunity principle, which provides a powerful platform for the formulation of social and economic policy—one of the rare policy goals on which a political consensus is easier to achieve.” Such differences in opportunity as are found in South Africa are morally wrong and should not be tolerated. Through this disparity in opportunity there is a direct shunning of some of the country’s best talent from expressing its true potential. Factors like the quality of education and socio-economic status play a major role in the youth’s ability to access education. It is quite important to note the burden the government has in

rectifying the injustices of the past; and that although it may be doing so with adequate resources, the quality and quantity of this rectification may be lacking. Inequality can be easily identifiable, especially in South Africa, along racial lines, allowing politicians the freedom to dodge difficult economic issues and rather promote simple solutions (pivoting on the racial element) to rather complex situations. Poverty, lack of public service delivery, and lack of job creation (according the aforementioned Professor Keeton), can all be blamed on inequality rather than on politics and political failure. Professor Keeton goes on to say in his study that if inequality is the cause of all problems then the solution must be to take from the rich to give to the poor. From what Professor Keeton is saying it can then be argued that the problem primarily is the selfish unwillingness of the rich of society to share what they have gained at the expense of the poor. In retrospect to the implications of apartheid, this lack of redistribution could be holding back economic emancipation of the poor. The past two decades in South Africa have proven that there is no easy solution to the problem of inequality. Without substantive improvements in human capital, the poor will stay poor. Given the backlog created by apartheid an even wider range of resources is needed to facilitate these improvements. Yet the country would need for these resources to be used wisely, unfortunately with our current government there does not yet seem to be any light at the end of the tunnel. Azi Mqatazana is a 3rd Year BSocSc student majoring in Clinical Psychology and Law.

ECONOMY

OPINION

Should the fundamental model change? Pahee Kaumbi reflects on South Africa’s black economic empowerment policy.

n a country with dynamic social circumstances, Black Economic Empowerment (BEE) as a policy initiative to uplift the previously disadvantaged has created debate on its merits from both sides – those that argue that it should be more inclusive in the face of a changing populace and those that argue that even with redistributive measures such as BEE, more should be done to address the problems of inequality and the disproportional wealth gap that subjects 56.8% of the population to poverty. BEE was launched to rectify the structural barriers that the apartheid government imposed on the population classified as non-white. BEE is intended to empower the previously disadvantaged by tipping the advantage back in their favour. In this way, unequal treatment may be justifiable. The constitution recognises redistributive methods to address the unbalanced system of a bygone era. In recent media, BEE has been associated with being beneficial to an elite few, tender entrepreneurs and corruption. It is apparent that some have abused the model for financial gain instead of using it to contribute to more inclusive growth. Corruption arising from inadequate provisions in the structure of BEE policy has blemished the good intentions of its legislative drafters. Our staggering unemployment and poverty levels overwhelmingly affect black South Africans. BEE has arguably failed to address the circumstances of the majority in any real way beyond a small well-connected new elite. Rarely do the benefits trickle down to those in dire need of employment and capital resources. Further, inequality has increased since the 1994 democratic elections. BEE was defined and rationalised by the 2001 commission report: “It is an integrated and coherent socio-economic process. It is located within the context of the country’s national transformation programme, namely the RDP. It is aimed at redressing the

CAPE TOWN GLOBALIST • APRIL 2016

“

Corruption arising from inadequate provisions in the structure of BEE policy has blemished the good intentions of its legislative drafters.

imbalances of the past by seeking to substantially and equitably transfer and confer the ownership, management and control of South Africa’s financial and economic resources to the majority of its citizens. It seeks to ensure broader and meaningful participation in the economy by black people to achieve sustainable development and prosperity.” — BEE Commission Report, pg. 2 In 2004 the Broad-Based Black Economic Empowerment (B-BBEE) Act (53/2003) was announced. The main purpose of the Act is to substantially increase ownership and control of businesses by black South Africans. The Act was created to remedy the narrow scope of the BEE structure. In the context of current unemployment and poverty statistics, it is evident that a lot more has to be done towards redistribution and inclusive growth. In 1994, the promise of a just and equal society resonated across the country and the issue of equal opportunity was the subject of much discussion. Sadly, the reality is that the country is still caught in a vacuum of inequality and poverty. The majority of those affected are black and remain disadvantaged. In theory, the B-BBEE model should change with the times. In response to a changing society, policy should

”

also adapt. In particular, critics argue that as more previously disadvantaged individuals reach the middleclass, policy should be re-evaluated to address such change. In reality, the majority of the population who still reside in areas of minimal economic infrastructure and employment opportunities remain those that were marginalised by the policies of the past. Wealth for the most part is still not distributed equitably and this is problematic for those that argue for a fundamental change to the B-BBEE policy. Despite its intrinsic inadequacies, success stories of this model of empowerment exist. Many previously disadvantaged individuals have had a change in fortune due to this policy. Opportunities have been created through tangible boardroom exposure, associated incomes, as well as some executive control of significant businesses in the formal sector. Workers have also benefited from B-BBEE initiatives to the extent that some have seen upliftment within their respective companies. However, those in society that the policy exists to help still have a long way to go in realising true economic empowerment. Pahee Kaumbi a Bcom student majoring in Economics and Finance.

ECONOMY

OPINION

Why unions joined Gordhan’s roadshow Federations attempt to “save the country”. By Terry Bell.

wo names now epitomise the specific economic problems and political turmoil South Africa finds itself in: Zuma and Gupta. Locally, this became abundantly clear with revelations this week by former parliamentarian Vytjie Mentor and Deputy Finance Minister Mcebisi Jonas. But it was also underlined a week ago during the investment roadshow to Britain the the United States headed by Minister of Finance Pravin Gordhan. Mentor and Jonas both told how they had been offered ministerial posts by the Gupta family, which some commentators have maintained has captured the state through their influence on President Jacob Zuma. Even before these revelations, such comments were not unusual during the Gordhan roadshow that addressed some 250 representatives of major investment companies. It was made clear during a series of meetings, that the attendees at the roadshow events considered bad political leadership, looting of state assets and corruption as the major problems facing South Africa. As a result, their priority call seemed to be for the country to resolve as quickly as possible what is diplomatically described as its “political uncertainty”. It was patently clear that the investment companies were well aware of the political machinations underway within the ANC and government and of the influence of the Gupta family. Questions were asked about the sudden firing of former finance minister Nhlanthla Nene, the role of the Gupta family in this, and how secure was Gordhan in his present post. There was also concern expressed that Gordhan was still the subject of a Hawks investigation. And it was clear that several of the investor representatives were aware of the background to Hawks boss General Mthandazo Berning Ntlemeza; that he had been described by a high court judge as a liar who “lacked integrity and honour” and

CAPE TOWN GLOBALIST • APRIL 2016

Image: Sebastian Derungs

“We have to safeguard South Africa from people who want to loot and to steal. We must support those who are standing up against this.”

yet had still been appointed to head the elite division. Although none of the participants are saying so, it appears obvious that investors see South Africa as being on the brink of becoming perhaps a resource rich banana republic. This, in fact, is the outcome that the the trade unions generally fear and was the prime reason for their willingness to be included in the roadshow. In what appears to have been something of an afterthought, representatives from the three major labour federations were invited to join the roadshow after it moved from London to the United States. Cosatu deputy president Tyotyo James, Federation of Unions (Fedusa) general secretary Dennis George and National Council of Trade Unions (Nactu) president Joseph Maqhekeni made up the labour component. Headed by Gordhan, the roadshow comprised seven members from the treasury and the revenue service, six from the business sector and the three trade unionists. Although labour laws and employer-employee relations featured as a factor for some investors, they were not seen as particularly important. In one reported, off-the-record, incident, a senior investment company executive asked bluntly: “When are you going to dump that president?” But the fact that a high powered labour delegation joined the roadshow should not be seen as any capitulation by the mainstream union movement to the National Development Plan (NDP) that is still solidly supported by Gordhan and the government. The NDP is still seen, by and large, as “neo-liberal” and is opposed in whole or part by the unions. Their involvement in the roadshow seems to amount

to an attempt to help to buy time to rectify the messy political situation the country finds itself in. “We have to fight for our country,” noted Fedusa’s George. “We have to safeguard South Africa from people who want to loot and to steal. We must support those who are standing up against this.” This was much the same message given to Nactu president Maqhekeni by his federation when he joined the roadshow. “We realised that we are on the brink of a very dangerous situation where the soul of the country is being sold on a platter of corruption,” said Nactu president Narious Moloto. Mqahekeni noted that withdrawal of more investment and the listing of South African debt as junk would harm not just workers and the poor, it would harm everyone, and control of the country would be lost. “It would send us into the hands of the IMF (International Monetary Fund) and the World Bank,” he said. In response to what Cosatu has called the junk status “blackmail” by the ratings agencies, the unions point out that more joblessness, poverty and desperation will also inflict severe damage to existing investments; that mines and factories cannot simply be parcelled up and moved somewhere else. On Friday March 18, Fedusa and Nactu met with Moody’s rating agency representatives. Cosatu was a notable absentee. The two federations spelled out their assessments and concerns in an attempt to “save the country”. This article originally published on GroundUp on 22 March 2016.

ECONOMY

PROFILE

The Bass Connoisseur loodshot and drained from an early rendezvous at a popular morning breakfast show, Bassist Sibusiso Matsimela documents his rise from playing in the dusty streets of Mamelodi to touring the Mediterranean.

Sibusiso sees his international performances across the world as inching a step closer to realizing his dream of being an internationally acclaimed bassist with mass musical appeal. ‘‘if from the dusty streets of Mamelodi a conversation inducing prankster can emerge, I don’t see how I cannot take over the live performance scene across diverse borders,’’ he says. From an early age, Sibusiso has always been one of those people who knew instantly their adult life would not be spent in an office. As an accounting university degree dropout at UNISA, the allure of soothing audiences with his rhythmic abilities proved a calling far too tempting than bean counting at some accounting firm. ‘‘I can honestly say accounting was the plan, but music sort of captured my heart,’’ he says. Far reaching is his reputation that his 21 Month tenure at the University of Cape Town has seen him perform at some exotic locations: the Stellenbosch winelands, private corporate functions and to his amusement –a tour of the Mediterranean with his trusty double bass and lively vocalist. ‘‘If I could, I would have stayed in Italy a bit longer… reality dictated I had to come back’’, he said staring out into oblivion having just done a performance at Espresso –a popular morning breakfast show on SABC 3. Sibusiso, with his contagious laughter and likeable persona speaks fondly of moving to Cape Town. Having been brought up in a family of humble means, the prospects of simply relocating somewhere picturesque seemed but a far-fetched dream. ‘‘The opportunities that have

landed on my lap since I moved here have seen me realizing most of my dreams, invitations to perform abroad with costs taken care of ’’, that I suppose with his love for travelling makes for the ideal workspace. This morning specifically, Sibusiso played backup to a vocalist he met in music school. Live on national television, his rhythmic ability was shown to thousands of households across the nation. That sort of exposure and spontaneity in what he does makes up for the dream that would have been had he followed his head instead of heart –‘‘I can honestly say I am doing what I love right now and it feels good bro’’, he says. Being raised in a strict household with three other siblings meant for an interesting upbringing. As the second oldest, he inherited the role of mentor from his older brother who moved from the family household which meant he had to administer responsible advice to his other siblings. That is not always easy when you have a twin brother. ‘‘I was told I was born first so I have authority over him’’, still with an expressive glee on his face –a chuckle lets lose whenever he conveys the shenanigans that are associated with growing up in a township filled with danger and nosy neighbours. The love for the double bass was not an initial thing, months on months of his childhood were spent beating away at someone else’s drum set. It didn’t matter who owned the set, as long as he was afforded the opportunity to play. As is mostly the case, naturally a kid is not concerned with the cost of owning a good set as opposed to playing on one. ‘‘My parents couldn’t afford to buy me a drum set so I joined a community musical upliftment project with the sole aim of playing their drums, unfortunately the set was occupied by someone who played better than me so I settled on the electric bass,’’ he says.

CAPE TOWN GLOBALIST • APRIL 2016

It all began in an NGO located in Mamelodi west, Gauteng. The Committed Artists for Cultural Advancement (CAFCA) is where Sibusiso crafted his musical ability. CAFCA recruits black youth in and around Mamelodi with not much musical experience and offers an alternative to mainstream employment opportunities a lot of youth from townships view as acceptable. Under the tutelage of the then coordinator Jesse Mohale, Sibusiso was taught the fundamentals of the bass which subsequently led to his acceptance into the University of Cape Town’s musical college. This avenue to accreditation, he hopes will ‘‘legitimize’’ his chosen profession in the quest to secure significant performances and related musical endeavors around the globe. Sibusiso’s twin brother is a Pianist in the Highveld, without a reputable formal education to his name; he earns decent wages from performing through solicited commissions to connections earned from friends and professional acquaintances. That sort of get-upand-go attitude in creating opportunities is what fuels the admiration to the ideals his brother operates on. If the same NGO can churn out two reputable musicians who just so happen to be twins, good things may still be coming in terms of future prospects learning to play the odd instrument at CAFCA. One cannot succeed without countless encounters of disappointment. ‘‘I do not have to balance a book, I do not think that is fun,’’ his distaste for what accounting represents (an office job) counts as one of the disappointments Sibusiso has had to face in realizing his passion. Although one may argue that such disappointment led to meaningful gain in experiences learned, dropping out of university is a wound still

fresh when talked about. Of the time he went to Italy as part of a musical exchange program of which he was recommended by the facilitator in charge he says, ‘‘I was culture shocked, and I had to think on my feet quickly as I landed alone in a foreign country’’. The experience is what ignited his passion for touring different ethnicities in the hope of showcasing African talent to the world. Sibusiso counts Ghana as a place of interesting parallels: cuisine on ethnicity, tradition on the influence of globalization and above all else parallels in the way women of Ghanaian decent adopt the new in a unique yet orthodox way through the adornment of ethnic prints. Ghana though was just a stop on his way to a jazz conference in San Francisco, USA. Hard work is the message Sibusiso hopes to get across, everything comes at a price. This morning particularly, conversing about the performance on television, a visibly drained man in need of sleep lay on his bed, laptop and music notebook in hand. The concept of taking it easy seemed farfetched when mentioned, the little pleasures most of us take for granted do little in persuading Sibusiso that hard work may be a dying art: ‘‘people work smarter now, not harder’’ is what I tell him, only to be met with a blank stare and disapproving twitch of the cheek. ‘‘I will never buy a television, who has time to watch that,’’ he says. This somewhat disinterest with popular culture only nurtures his social encounter skills. It is very hard not to like this guy, his relatable persona and clean smile make for an individual many would be proud to call their ‘main’ as the term circulating around popular youth culture –couple that with his musical ability and the recipe is a sure bet for success. ‘‘I do what I love, and what I love is playing the bass.’’ he says.

ECONOMY

The Centre for Film and Media Studies

The Centre for Film and Media Studies offers undergraduate majors in film and television and media studies, as well as various production programmes. On postgraduate level, full and part-time postgraduate courses are offered at the Hons and MA levels, in African Cinema, Documentary Arts, Film and Television Studies, Media Theory and Practice, Political Communication, Rhetoric Studies and Screenwriting. Staff in the Centre also offer supervision of MA and PhD studies. The Centre for Film and Media Studies has partnered with leading online education company, GetSmarter to offer continuing education online short courses to working professionals and amateurs. Having started with a course in Digital Photography in 2011, the partnership now offers courses across 7 disciplines:

FEATURE WRITING COPY-EDITING SCREENWRITING

GRAPHIC DESIGN

DIGITAL PHOTOGRAPHY

WEB DESIGN PHOTOSHOP

For inquiries about our postgraduate programmes, www.cfms.uct.ac.za or contact Petros.Ndlela@uct.ac.za If you are interested in the short online courses, get hold of GetSmarter on: Tel: +27 21 447 7565 | Fax: +27 21 447 8344 | Website: www.getsmarter.co.za | Email: info@getsmarter.co.za