DURBAN – South African Finance Minister Malusi Gigaba on Thursday said the South African economy had failed to create a sufficient number of black entrepreneurs and industrialists to reflect the proportion of black people in the population.
Gigaba told delegates at a Brand South Africa Thought Leadership meeting on the sidelines of the World Economic Forum Africa meetings in Durban that at the heart of the inclusive growth narrative being punted by government were interventions aimed at significantly changing the structure of the South African economy.
This would be achieved through industrialisation and ownership, developing township and rural economies through productive economic activities and bringing government services closer to these areas.
“Whereas the share equity schemes have played their role in the past 23 years to create a vast consumerist black middle class, it could not achieve the goal of changing property ownership patterns and creating a vast corps of real black entrepreneurs and industrialists.”
Gigaba said he wished to be bold and say that “during the past two decades we have created very few genuine black entrepreneurs and industrialists in proportion to the black population in our country”.
“The successful pursuit of the above would ensure that we grow the economy in an inclusive manner so that we expand our revenue base and continue to use the fiscus in a redistributive manner to invest in growing our human capital,” he said.
He added that this would be achieved “through social expenditure, expanding economic investments and accelerating micro reforms”.
Gigaba said he firmly believed that the role of the National Treasury “is not to fixate with managing a fiscus that is not growing, but we must play the role of spearheading inclusive growth”.
The former home affairs minister cautioned that South Africans seemed to be engrossed in debate on semantics regarding whether the country should take the path of radical economic transformation or inclusive growth.
“The fact is … it is not sustainable for the South African economy to grow without a significant role for the black majority, for women and for workers and the poor.
“It should be unsustainable for anybody to think we can grow this economy by creating new forms of exclusion and economic as well as political polarisation,” he said.
“We must act in a responsible and sustainable way with a sense of urgency and purpose while we still have time,” said Gigaba.
He noted that the South African economy was peculiar because its structural defects had racial, gender and class connotations.
“The fact is that what our economy needs is meaningful structural reforms that reverse these racial, gender and class connotations and address structure, ownership, institutions and partnerships.
“We must not make the mistake to portray inclusive growth either as only about creating jobs for the black unemployed or to be about economic empowerment for those aspiring to be black entrepreneurs. It is about both, and more,” said Gigaba.
– African News Agency (ANA)