The fourth largest political party in South Africa (SA), the Economic Freedom Fighters (EFF) will be holding its third National People’s Assembly (NPA) on December 13-16.
While the prevailing narrative might have you believe that the main issue of contention in this gathering is a fallacious battle for leadership positions within our ranks, this could not be further from the truth.
To us fighters, the NPA is an important policy development conference that will have lasting implications for the organisation and the country by extension.
In this short article, I explore the EFF NPA discussion document’s chapter on the economy within the context of municipality-led local economic development in the Eastern Cape (EC).
The NPA discussion documents embody a practical approach to possible avenues for implementing longstanding EFF policies as envisioned in our Founding Manifesto. In exploring the EFF’s position, I begin by outlining some of the critical challenges confronting local economic development in the province as guided by the diagnosis of national challenges.
I then reflect on the EFF’s proposals and how they can empower us to decisively resolve these challenges and ensure local economic development towards the creation of jobs, reduction of unemployment, and elimination of rampant poverty in the province.
Challenges Confronting Eastern Cape Municipalities:
The central tenant of the EFF’s political programme is “economic freedom in our lifetime,” premised on the belief that political freedom is meaningless without control of the commanding heights of the economy.
This historical belief is grounded on superior and practical logic because there is no political programme that can produce positive outcomes without having enough financing – money makes the world go round.
It would be impossible to extensively cover the argument of the entire diagnosis in this short article, but I will provide a high-level summary of its manifestations in the EC. At the centre of the diagnosis is the argument that our economy is deeply racialised, characterised by consistent de-industrialisation, rampant unemployment, and increased dependence on the financial services sector.
In addition, the national economy is plagued by challenges of poor energy provision, deteriorating infrastructure, and poor management of our fiscal and monetary policy. The results of these challenges do not spare the province and have far-reaching implications for a mainly rural province such as ours.
The racialisation of the economy is a persistent reality in the province. A close analysis of economic activity reveals that the white minority remains in control of most of the economic activity in the province. Not only is this true in the private sector, but also in the public sector.
An in-depth analysis of the tenders issued by municipalities, particularly metropolitans such as Nelson Mandela Bay and Buffalo City reveals that while there is a rise in the participation of black-owned businesses, the main beneficiaries of state business remain the white minority – even through the fronting of black partners in some instances.
This is a worrying trend that needs to be curbed and requires deliberate intervention from political actors. Being someone who always drives across the province doing constituency work of the legislature and political work of the EFF, I am always disheartened by the reality of deliberate de-industrialisation.
The number of factories in this province is extremely high, but a small percentage of these are operational. When one tries to follow up as to what the challenges are, one finds that there are none that are fundamental, with the main challenge being an absence of the political will to open and operate these factories.
This province not only has high trade potential due to its multiple ports, but it also has existing industrial infrastructure. Why this potential is not explored by the provincial government is anyone’s guess.
The fact that the province has this level of industrial potential, but also has high levels of unemployment is probably the biggest anomaly in the nation’s economy. The EC has among the highest unemployment in the country but is still not exploring its full industrial development potential.
This refusal by the provincial government to drive development is not only within the manufacturing sector but also extends to sectors such as agriculture and tourism. The province has among the most fertile land in the country, but there is no deliberate effort by the government to maximise the use of this land and create millions of jobs.
Instead, the government is complacent in allowing this land to be in the hands of the white minority who use a small portion of it for food production while hogging the rest without productivity. This in turn affects the tourism sector as there are many sights to behold in this province which remain within the boundaries of privately held land.
These challenges persist due to indecision by a provincial government that fears white people and allows them to continue bullying most of the people economically, socially, and by extension, politically.
This reality is clearly expressed by the dominance of the financial services sector in the province, where our people are encouraged to take up insurance, funeral plans, and loans to create financial security and survive on a day-to-day.
This is a sad sight to behold when we know that if the government could explore and maximise the development potential to create employment opportunities, then our people would be able to independently develop financial security in the present and the future.
The dependence on the financial services sector, which is not interested in reinvesting in the province’s development, represents one of the weakest political and economic positions held by the province. They are effectively telling people to continue exporting the money of the province without any obligation to give back.
All these realities existing within the background of poor energy provision, almost non-existent maintenance of municipal infrastructure, and poor economic policy flowing from the weak national government, provide a clear reason for the current state of the province’s economy.
What is to be Done? Implications of EFF Policies and Prospects for Local Capacity and Economic Development:
Solutions to economic challenges:
The EFF, as a leader of society, not only provides a correct diagnosis of the problems but also provides practical and implementable solutions that require political will and decisive political action in governance.
While these solutions are outlined in the discussion document within a national context, they are easily implementable in the provincial context. The central pillar of the EFF’s position is the centering of state institutions in driving the economic activities of South Africa (SA).
In the context of the province, this can be achieved through political leadership in government at a provincial level and the localization of production and distribution of goods and services towards the creation of millions of sustainable jobs that will contribute to massive growth in the gross domestic product (GDP) and GDP per capita of the province.
Practically speaking, the provincial level of government has a responsibility to reject neo-liberal economic policies and reaffirm the leading role of the state in all aspects of the economy.
The province must lead and manage the policy, infrastructure development, energy provision, and land custodianship aspects of this political programme.
This is while the more operational aspects such as industrial activities of manufacturing, agriculture, and tourism, among others, must be localised to municipalities to maximise the participation of and beneficiation by the people on the ground.
The procurement capacity of the municipalities which must be guided through a decisive fiscal policy at national and provincial levels is at the centre of this program. It cannot be correct that municipalities continue to procure goods and services from entities who have no development interest in the province.
It must be a requirement of law that the municipalities must procure only from service providers who have a proven track record of advancing sustainable development in the communities of the province.
Furthermore, the procurement needs of municipalities must be drastically reduced through the development of internal capacity to produce goods and services.
The EFF President, Julius Malema has indicated on many occasions that it is truly embarrassing that the state cannot produce basic goods it consumes daily such as toilet paper and toothpicks, for example. And in a province like EC with so many dilapidated and operational factories, this is even more embarrassing.
The reality is that the unfortunate situation in the province which has earned us the title of being “the Cutting Edge province” is not a natural phenomenon but is man-made and systemically maintained.
If I were to reflect on all the extensive propositions made by the EFF on how we can overcome these challenges, then this article would become a book. In essence, the province – much like the country, can only be saved by strategic, state-led industrial development with a focus on manufacturing, agriculture, and tourism among other sectors.
It requires a decisive provincial leadership that will provide policy guidance and legislative protection to its municipalities to ensure the de-racialisation and localisation of the economy characterised by localisation of production and manufacturing. It is only this approach as the EFF proposes, which can bring the province out of the current sad situation that we find ourselves.
For those interested in a deeper understanding of this perspective, the Economy chapter of the EFF discussion documents, and all other chapters (for a broader contextual understanding of the perspective) are accessible through the following link: https://effonline.org/3rd-npa-discussion-documents/
Simthembile Madikizela is EFF EC Provincial Secretary, EC Member of the Provincial Legislature, and Member of the Committee on COGTA