The economy of South Africa has been in the doldrums roughly since Thabo Mbeki left office in 2008. If South Africa had maintained the solid growth achieved during his presidency most of the problems of poverty, inequality and joblessness would not now be stalking the land.
As the most unequal country in the world (Gini-index of 0.65) South Africa has an unemployment rate estimated at 42% overall with about 70% of the youth classified as NEETs (meaning not in education, employment, or training).
The Bureau for Economic Research (BER) at Stellenbosch University has downgraded its real GDP forecast for South Africa from 2% to 1.5% in 2025, citing mounting political instability and unresolved global economic risks. According to a report in Business Day, this aligns with Moody’s Ratings, which also cut its forecast to 1.5% last week – a 0.2 percentage point downgrade from its February projection. In 2027-30, the BER expects growth to average just 1.6% between 2027 and 2030, and it is reported that some in the organisation “have questioned whether SA has effectively become a 1%-growth economy, a level it has struggled to break through for more than 15 years”. The International Monetary Fund recently cut South Africa’s expected growth rate to 1% for this year.
It is obviously, screamingly so, imperative to grow the economy with urgency and at an exponential rate. Current challenges in South Africa are threatening its future as a constitutional democracy under the rule of law, as envisaged by the founders of the post-1994 dispensation.
Lament
Professor William Gumede laments the dysfunction of the state eloquently and accurately.
The professor points out:
“The collapse of towns, inner cities and suburbs across the country because of corruption, incompetence and lack of accountability has been one of the biggest destroyers of wealth for individuals, communities and businesses. It has also caused huge reductions in income for local municipalities and cities.”
The achievement of equality, the full enjoyment of guaranteed human rights, and respect for human dignity are all unattainable at the current level of economic growth. In addition, this growth projection follows a period of slower growth, with GDP averaging only 0.8% growth annually since 2012. None of these estimates are good news for those in desperate need of economic growth that matches or exceeds population growth in South Africa.
Those in government are aware of the truths summarized above.
The president himself seeks a growth rate of 3.5% by 2030, so much greater than current and currently predicted levels which are both under 2%. His minister of finance has identified with great accuracy the structural challenges the nation faces. While the president mentions state capture in passing and, inaccurately so, in the past tense, he makes no reference to the corrosive effects of corruption in his address marking the launch of Phase Two of Operation Vulindlela on 7 May 2025.
The minister more helpfully states: “There is a strong consensus that economic growth is constrained by structural factors, such as a shortfall in electricity supply; an inefficient and unreliable freight logistics system; and crime and corruption. These constraints inhibit the real economy and undermine investor confidence.”
In short, it is the minister who correctly identifies crime and corruption in South Africa as factors holding back economic growth.
Addressed squarely and urgently
The issue that needs to be addressed squarely and urgently, if South Africa seriously wishes to attract new investments and investors, boost business confidence in existing investors, and thereby achieve the wished for 3.5% growth is the issue of neglected serious corruption. This issue has been addressed by our courts, but not adequately by both the legislature and the executive.
In 2011, shortly after the commencement of the state capture phenomenon of the Jacob Zuma years, the Constitutional Court had the following to say under the heading: “The need and rationale for combating corruption” (Available as Appendix Two, free of charge, in the ebook version of Under the Swinging Arch.)
“There can be no gainsaying that corruption threatens to fell at the knees virtually everything we hold dear and precious in our hard-won constitutional order. It blatantly undermines the democratic ethos, the institutions of democracy, the rule of law and the foundational values of our nascent constitutional project. It fuels maladministration and public fraudulence and imperils the capacity of the state to fulfil its obligations to respect, protect, promote and fulfil all the rights enshrined in the Bill of Rights. When corruption and organised crime flourish, sustainable development and economic growth are stunted. And in turn, the stability and security of society is put at risk.”
Having thus carefully considered the need to combat corruption properly the court found that:
“…[O]ur law demands a body outside executive control to deal effectively with corruption.”
Despite the binding nature of this finding, no such body exists, nor has it existed at any time since September 2012 when the court’s deadline for remedial legislation expired. The experiment with the creation of the police unit known as the Hawks, and the tweaks that experiment received from both the legislature and the court itself, has not been a success on the anti-corruption front. Nobody seriously contends today that the Hawks are the answer to endemic and systematic serious corruption in South Africa.
As what the then deputy minister of justice described as “a stopgap measure”, the Investigating Directorate against Corruption (IDAC), a directorate in the National Prosecuting Authority, came onto the statute book in May 2024. Its introduction was more as election time posturing than as a serious attempt to meet the criteria set when a single “body outside executive control” was ordered by the Constitutional Court.
None of the attributes required by the court are enjoyed by IDAC. It is not an independent body of trained specialists with a guaranteed budget and secure tenure of office. The criteria for this body are discussed in greater detail on page 22 of a special edition of Africa in Fact.
Legally speaking
Legally speaking, IDAC is indistinguishable from its predecessor within the NPA, the Scorpions unit, which was summarily closed down for doing its job too well. This closure followed an urgent resolution taken by the ANC in December 2007, the moment that Jacob Zuma became president of the ANC. The same fate could also befall IDAC which is a mere creature of an ordinary statute, as were the Scorpions. A simple majority in parliament sealed the fate of the latter.
The ANC has always tried, as a matter of policy, to secure what it calls “hegemonic control of all the levers of power in society” for itself. This goal, which hardly aligns with the doctrine of the separation of powers in particular and the tenets of constitutionalism in general, is now not achievable, given that the ANC enjoys ever dwindling support from voters and only 40% of the seats in the National Assembly. Its seats are derived from support from only 16% of the electorate. This poor showing is attributable to the low turnout of voters in the May 2024 elections. Recent polls indicate that if an election were held now the ANC would be down to 29% of votes cast. It has marginally less support than the DA.
IDAC is not a constitutionally compliant body. The president was warned of this fatal defect before he signed it into law. He chose to ignore the warning given.
Premature
It is currently premature to apply to court for relief impugning the constitutionality of IDAC because parliament has before it, for consideration and debate, the two private members’ bills sponsored by Glynnis Breytenbach which, if they secure the necessary two-thirds majority, will address the defects in IDAC by its replacement with a new Chapter Nine Anti-Corruption Commission to prevent, combat, investigate, and prosecute serious corruption.
Our courts, very properly so, defer to the other spheres of government and will only test the constitutionality of the IDAC dispensation if parliament rejects the Breytenbach bills and declines to develop a constitutionally compliant way for setting up an anti-corruption body that is outside executive control.
Due to the ANC currently occupying 40% of the seats in parliament, it is able, if it so desires, to thwart the Breytenbach bills by voting against them. It would be ill-advised and possibly political suicide on the part of the ANC to do so because its negative vote would provide positive proof that it remains soft on corruption. Its unwillingness to take obvious and constitutionally compliant steps to address the parlous state of affairs around corruption with impunity, may also deleteriously affect unity within the GNU after friction over EWC, NHI, BELA, BEE and the budget fiasco.
The perpetration of serious corruption with impunity is the main issue thwarting economic growth in South Africa, but it is one that currently remains unaddressed despite the work and findings of the Zondo Commission into state capture and the speeches of the president and minister of finance referred to above.
The failure to respect the rule of law by properly implementing the judicial findings scares away investors both old and new, foreign and local.
Bonang Mohale, Chancellor of the University of the Free State, recently boldly, but accurately, remarked during a wide-ranging speech he delivered in the USA:
“the great problem for South Africa is rampant greed ….[it] is essentially a problem for the once glorious African National Congress that has morphed into an organised crime syndicate, primarily because for a solid 30 years of our democracy, they held the absolute majority power in everything that matters”.
Public interest
Should the Breytenbach bills be rejected it will be because they are not supported by the ANC, and should IDAC be persisted in, the way is open to any public interest litigant to seek relief from the courts claiming:
- A declaratory order to the effect that the IDAC legislation is unconstitutional and that the failure to implement the decision of the Constitutional Court of 2011 is illegal;
- A mandamus directing the government to take remedial steps to implement properly the said decision that a body outside executive control take charge of combating corruption;
- A supervision order directing government to report to the court at regular intervals on progress being made toward implementing the mandamus.
It is to be hoped that the ANC does appreciate that it is no longer the majority party and that its political health (its popularity with the voters) is dependent on the rapid growth of the economy. The reform advocated by Breytenbach will send a clear message to investors both old and new, that South Africa is again indeed “open for business” and that they need not fear that their new ventures will be stymied by corruption.
The economic growth so desperately needed in South Africa cannot possibly be achieved while corruption with impunity continues. Acting on the truth of this statement is urgently needed in the legislature and executive. The judiciary has already set, in binding terms, the necessary parameters and spelt out the criteria by which to measure the anti-corruption machinery of state. It is time to follow through in parliament on the good work the courts have done.
The views of the writers are not necessarily the views of the Daily Friend or the IRR.
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