Wandile Sihlobo is one of South Africa’s foremost voices on agricultural matters. He combines an intimate understanding of the sector globally and locally with an in-depth appreciation of economics and practical experience in the field. When he speaks on these matters, it’s a good idea to listen to him. A contribution to the Daily Maverick last week (a similar piece was carried on BusinessLive) invites just such reflection.
‘Critical that government leads the way in reforming key agriculture sector’, the headline reads. The focus of Sihlobo’s argument is the Agriculture and Agro-Processing Master Plan (AAMP). Not without justification, he extols the plan as rooted in evidence, and providing a workable framework for dealing with the challenges confronting the sector. While acknowledging that it is not entirely congenial to every interest group, he feels that it successfully balances competing interests, so that all could ultimately live with it.
Properly executed, this could have been a driver of growth for the farming economy and its associated industries, as well as a multiplier for rural wellbeing. And as do so many commentators on so many issues, he laments the failure to implement the plan, and the consequent dissipation of enthusiasm for doing so.
In Sihlobo’s view, the failure to get the plan off the ground is attributable to the various intervening crises that took attention away from the long-term vision, things like load-shedding and the logistics mess. Getting it right demands leadership, a role he believes only the government is in a position to play. The government will need to coordinate its own operations – across its various levels – and take the helm of the process: ‘the government will have to be at the centre of this process to lead the way.’
In principle he’s correct. Like South Africa’s other sectoral strategies, the AAMP was premised on cooperation among participants in the sector. There is merit in this. Cooperative relationships between governments and businesses can be a valuable asset for a society. Understanding each other and valuing the respective contributions that each one makes is a firm basis for a developmental drive.
In theory, this has been the thrust of South Africa’s economic thinking since the transition, phrased in terms of a ‘social partnership’ encompassing labour and ‘the community’ too.
Together, again in theory, South Africa’s economic stakeholders would negotiate away their differences, find common ground and work to the benefit of the country as a whole. It’s been an idea with remarkable staying power, from the establishment of the National Economic Development and Labour Council in 1994 to President Ramaphosa’s pledge last year to conclude a social compact for the country. The AAMP stands firmly within this logic.
It’s not just the AAMP that has foundered, it’s the entire idea of the cooperative bargain.
Co-operation between South Africa’s various ‘stakeholders’ has always been as much pretence as reality. The sympathies of South Africa’s authorities have always yawed closer to those of labour (and the ‘community’) than to business. This is certainly the case in ideological terms; the ANC is formally aligned to the country’s largest labour federation, and this has given the latter enormous influence over labour policy – the consequences for employment notwithstanding.
There is a sizeable part of the ruling party that is doggedly hostile to business and would rather it vanished from the scene altogether. (Compacting has also locked out both the unemployed and small-scale business, whose interests do not coincide with either ‘labour’ or ‘business’ as these institutions include them.)
Compacting has failed in what should be its most obvious (intended) benefit, ensuring industrial peace – South Africa’s industrial relationships have been ruinously conflictual.
But more fundamentally, the South African state is not a reliable partner. It has fancied itself a developmental state, a mighty agent of South Africa’s modernity in the mould of Japan or South Korea or latterly China. The China fixation has been particularly mesmerising for South Africa’s political leadership – rapid growth and rising living standards under the unassailable rule of an irremovable party (proclaiming socialism) was a beguiling one. There was even a fantasy of South Africa’s State-Owned Enterprises filling a role similar to China’s.
Thanks to an almost conscious neglect of the imperative of technical and managerial competence, an obsession with racial ‘transformation’, the illegal commandeering of these institutions by the ANC through ‘cadre deployment’ and the fetid venality that attended all of this.
Today, the state is broken. Perhaps in an ideal world, it should provide leadership to a national developmental effort, but in South Africa it is just not in a position to do so. All things considered, the South African state is probably the largest single hindrance to growth and development in the country.
It has failed to create a socio-economic context conducive to growth. This includes a dismal record in tackling crime (this is not mitigated by recognising that the post-apartheid government inherited a huge problem), appalling stewardship of most of the network and logistics assets over which it disposed, and a policy environment that lurches between ‘uncertainty’ and ‘outright hostility’.
Rather, the government has pushed ahead with profoundly destabilising, ideologically driven and investment-killing initiatives. For the farming economy, one need say no more than Expropriation without Compensation, but much more remains to be said.
As a policy drive and political campaign it was well thought out and executed, with multiple lines of legislative action (a constitutional amendment as well as new expropriation legislation, along with regulations giving the state an advantage in valuation), plus a long-standing campaign of vilification against farmers.
More recently, proposed water quotas would see this vital resource allocated along racial lines. And even while the AAMP was meant to be implemented, the Department was engaged in plans to use an arsenal of administrative and regulatory measures to coerce racial ‘transformation’ of the entire sector.
Frankly, it’s doubtful the AAMP could be viewed as a good faith programme against this background.
Underlying all this is something perhaps more ominous: the ANC and the government it leads just doesn’t get the problem. It knows that things are dysfunctional, and it bewails this. But its appreciation of the nature of the crisis is severely and fatally limited by its own ideological horizons. Its own conduct is central to its self-image and central to South Africa’s problems. It simply can’t acknowledge the true extent of what needs to change.
So, yes, the government wants a vibrant agricultural sector. But it also wants an agricultural sector of its choosing – in other words, one that reflects its demographic imagination. The actual commercial farming community as it exists is unacceptable and is to be pressed into change by the blunt tools of official regulation on the assumption that existing expertise can be dispensed with because it can so easily be replaced.
Meanwhile, the government recognises the need for stable policy, and for well-functioning institutions and infrastructure. ‘Policy certainty’ is something towards which South Africa is incessantly ‘working’. (Given its demographic objectives, not to mention the imperatives of patronage, it’s not a goal that is likely ever to be realised.) Governance and infrastructure have been allowed to decay, with scant evidence that the innumerable turnaround strategies have had much impact. Holding malfeasant politicians or non-performing officials to serious account is inimical to the functioning – such as it is – of the party-state that the ANC has sought to build. President Ramaphosa speaks incongruously about the ‘professionalisation’ of the civil service, building a ‘capable’ state and continuing with the nemesis of both, which is his party’s illegal cadre deployment endeavour.
Those who remember the proposed terms of the grand social compact would recall that it came down to large sacrifices and commitments from business, significant ones from labour, while the state would try to improve on what it was already doing. It was rather reminiscent of one of those traffic lights in any of South Africa’s benighted cities, knocked over in an accident and surrounded by debris, but still drawing power and going pointlessly through the motions, while traffic flows by regardless.
The point is that the injunction for the state to take the lead may be sound in conception, but is unworkable in reality, at least if the objective is to propel a complicated plan for the greater good. The South African state, in its present incarnation, is not capable of doing so.
South Africa’s businesses, and not least its farmers and their organisations, need to accept this reality. There is no prospect of meaningful, productive cooperation from a state that is neither able to offer it nor especially willing to do so. Of course, it is not possible to wish the state away or to disengage from it; but it will be necessary to understand the character of what it is that they are attempting to engage with. In this respect, a healthy measure of outright transactionalism – illusion-free bargaining, demanding something in exchange for something else – would be a good place to start.