SA must put own interests first, stop being ‘played’ by Russia, China – Cilliers

A lack of execution and confused leadership is holding back the nation.

Published on:

23 Oct 2024, 12:41 pm

A massive, multi-year research project by the Institute for Security Studies reached a jarring conclusion – South Africa's economic stagnation directly results from ideology trumping pragmatism. ISS chairman Jakkie Cilliers, a globally celebrated futurist, says SA's leaders know exactly what to do to put the nation onto the path to prosperity and poverty alleviation. But a lack of execution and confused leadership is holding back the nation.

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Edited transcript of the interview ___STEADY_PAYWALL___

Alec Hogg (00:09.814)
Jakkie Cilliers is the chairman of the Institute for Security Studies. He's a futurist by trade, you could say, and a well-known author. Today, he's going to walk us through the latest work they've done about South Africa's future, not only on the economy but also on energy.

Alec Hogg (00:35.958)
Jakkie, you must be in great demand nowadays. Geopolitics have become front and centre for everyone, not just politicians. If you're in business, you better know what's going on in geopolitics. Are you run off your feet?

Jakkie Cilliers (00:54.939)
Yes, I'm very, very busy. After working on peace and security for a few decades, I moved into forecasting. We run a large website that looks at Africa's long-term future and how global developments impact Africa. We call it "Africa and the World." So I spend a lot of time on reviews, presentations, and travelling. The world is changing, and nobody really knows where it's heading, but we all try to frame our analysis. The next two weeks are crucial, with the upcoming U.S. elections.

Alec Hogg (01:34.09)
And of course, the BRICS meeting is happening now, with Putin bringing in North Korean troops to fight against the Ukrainians. It's a crazy world we're living in. But let's focus on home, South Africa, where we can at least try to understand things. You've done a lot of work recently on South Africa's future over the next 20 years. Why do you focus on this timeframe?

Jakkie Cilliers (02:07.847)
There are two main reasons. First, it's part of my day job. In June 2022, President Ramaphosa launched a large website we host in collaboration with the African Union Development Agency, NEPAD. They are the custodians of Agenda 2063, the African Union's long-term vision launched in 2013. It's implemented in ten-year action plans—2023, 2033, 2043, and so on.

We adopt a forecasting horizon of 2043 for all our work and cover long-term development for every African country, sector by sector. Once we've done that, we also look at how energy transition, climate change, and global developments impact Africa. This is a massive exercise, with over 4,000 charts and nearly a million words of text on the website. We work with African governments to help them unlock growth in their countries.

For South Africa, we've recently updated comprehensive work I've done over many years. You may remember my book, Fate of the Nation, which looked at South Africa's long-term prospects with various political and economic forecasts. As a South African, I'm keen to see the country progress, so we completed a long-term forecast on South Africa's development prospects and how they might unfold over the next 20 years.

Alec Hogg (04:28.61)
There have been many plans for South Africa, but execution has been poor. Can you give us any hope that, even if we know the right path, we'll actually take it instead of getting sidetracked, as often happens here?

Jakkie Cilliers (05:00.431)
There's so much I could say in response to that. Let me start with a favourite anecdote. South Africa has a National Development Plan, initiated by President Zuma. The plan was supposed to be a long-term vision for the country, but its primary purpose was really to move Trevor Manuel out of the Finance Ministry. We have a beautiful, comprehensive plan, but poor governance, corruption, state capture, and external factors like COVID have derailed those intentions.

The Ramaphosa administration has plenty of plans and good intentions, but what we lack is accountability. There is no consequence management. Our update for South Africa looked at eight key sectors, reviewing existing plans and strategies. The main takeaway is that things have improved, and there's real hope. But it will take time to recover from the damage done.

South Africa's GDP per capita peaked in 2013. On our current trajectory, we only get back to that level by 2036—that's 23 years of stagnation or even decline.

Alec Hogg (07:07.138)
Just to clarify for listeners: GDP per capita is a measure of a nation's wealth, dividing the total economic activity by the population. It's a key indicator of whether a country is getting wealthier or poorer. So you're saying it'll take 23 years to get back to where we were in 2013?

Jakkie Cilliers (07:33.181)
Yes, 23 years. We could improve that timeline slightly by throwing everything, including the kitchen sink, at our development efforts. If we do that, we could reach 2013 levels by 2030. But from a political perspective, the key message is that the government of national unity (GNU) must hold, and we need a centrist coalition that can last until at least 2034, after the 2029 elections.

The ANC has lost its majority and might get a slight bounce-back, as Frans Cronje suggested on your program. But none of the major parties, including the ANC and DA, will reach 50%. The ANC is in structural decline, though it might improve from 40% to 45%. We need a coalition, and the ANC, DA, and IFP represent different constituencies, which could help stabilize the country.

Alec Hogg (09:32.086)
The risk is that if the GNU doesn't deliver improvements, radical parties could gain momentum in the next election. Given that reforms take time, what can be done in the short term to make a real difference?

Jakkie Cilliers (10:17.237)
There are some obvious, low-hanging fruits. For example, reforms in Home Affairs can have an immediate impact. However, big transitions in education and healthcare will take longer. We also need to open up Transnet and fix the ports. South Africa is too hesitant when it comes to global trade, and we need to seize every opportunity for growth.

A recent example of a bad decision is the removal of the Taiwanese representation from Pretoria, bowing to pressure from China. Taiwan is a significant investor in South Africa, especially in low-end manufacturing. At this point, we need every friend we can get, and all decisions should be made based on whether they contribute to our development, attract foreign direct investment, or enhance growth.

Among the eight sectors we model, manufacturing and free trade, especially under the African Continental Free Trade Area, have the most potential. But as always, we lack implementation and consequence management.

Alec Hogg (13:51.202)
It sounds like there's plenty of low-hanging fruit, but political considerations often get in the way. You mentioned the need for South Africa to act in its own interest rather than be driven by ideology. What's your view on South Africa's handling of relationships with global powers like Russia and China?

Jakkie Cilliers (14:59.549)
We've been played by Russia and, to a lesser extent, China for years. The BRICS partnership elevates South Africa's international standing, but we must balance our interests. Ideology often clouds our decisions, and we need a hard-nosed, data-driven assessment of what's best for South Africa. While China is our largest individual trading partner, the EU, as a group, is far more important in terms of trade and investment. We should focus on Southern Africa as our natural market and eliminate obstacles to growth.

Alec Hogg (16:43.378)
We're small players in the global arena, and our resources are limited. Let's talk about energy. We've had over 200 days without load shedding, which is a relief. But there's still the challenge of moving toward renewables. How does that fit into your forecasts?

Jakkie Cilliers (17:40.397)
In your show notes, hopefully, you'll link to the report we've done for South Africa, which includes detailed forecasts on energy transition. We need to move away from coal, not just for environmental reasons but for our health and export interests. Our forecast shows that by 2043, South Africa could reduce coal dependency to 21%. Right now, we're at about 85% to 95%, depending on how you calculate it.

We project that by 2043, 57% of our energy could come from renewables, 19% from gas, and 4.4% from nuclear. We also account for reduced coal production and future energy demand. The transition to renewables, nuclear, and gas will be a massive shift, but it's necessary to ensure energy security.

Alec Hogg (20:16.918)
Jakkie Cilliers, chairman of the Institute for Security Studies. There's a lot more in the report, and you can find it on the website. I'm Alec Hogg from BizNews.com.

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