Growth! Growth!Jobs! Jobs! But these are but outcomes as a result of prior inputs. This is much the same if you sowed seeds or planted seedlings from a reputable nursery. If your soil, location, irrigation and so are not in place, you have a few good fruits and some straggly and plants but not sufficient for a fruit salad. So it is with jobs and growth in South Africa. We have a few good outcomes, some struggling ones, many courageous workers but the harvest is not enough for the growth in wealth and the creation of jobs. Two things need attention: the political environment and the economic environment. Both together are needed in good shape. In South Africa post 1994 the political environment is in relative good shape notwithstanding the party political charades we encounter. We have a good constitution – the rules of the game have been set and from this we have an independent judiciary and freedom of expression. But on the economic side we do not have the same. We have not taken the good in the constitution and translated its freedom into economic freedom. The political side of things was fully debated at the Codesa and if you remember we were running out of time hence we did an interim constitution and later approved the current constitution. We did not at that time pay sufficient attention to the economic implications arising from our constitution. Hence, the ground to grow domestic product and jobs were not properly debated. Firstly of by wide consultation and secondly we left the matter of economics to the same old Big Business and jaded economists, and the latter liked this trade off so we agree to constitution and left big business power to pull all the drivers in the economy. And so they did without changing the environment for the economy to grow and create jobs and the government acquiesced in this, not willingly, but there was other important matters on hand and very limited resources. The most important matter that the government dealt with was to provide a macroeconomic environment in which established business could flourish. And they did, but soon this was not enough, manufacturing dropped and so on, and so began the finger pointing dance while the richer became richer and the poor became poorer – an untenable situation given the rights enshrined in the constitution. You see the macroeconomic environment is very much like the air we inhale. It swirls around us providing all with oxygen and so on. But you and I can have as much oxygen as we like, if we are not eating well, feeling secure and safe, have a roof over our heads,food on the table (Basic Maslow) then the air might be good but in the ground, living is hard as the players suffer a deficiency. It is the same with business. Big and powerful as they may be and they can even be good for society, but if entry via being small is thwarted by lack of nutrients on the ground, then small and weak and vulnerable SME’s cannot thrive. And if these cannot thrive then consumption and investment cannot take place. And when these do not take place there is no profit and we have no GDP growth and no jobs. It is therefore correct to speak of building an economic empowering environment, a subject not addressed fully in the political Codesa. The biggest player in making this to happen is the government. Why? Government controls the biggest budgets in the country and that budget of cash which they use is your and my money and by the constitution we have agreed to choose a government to handle it equitably on our behalf. So we have given the power of the economy to government administration. All good democracies do this. But what South African government has failed to do is to say to business and NGO’s we do not have all the competencies needed, come and help us with building an economic empowering environment in which the production of growth and jobs can take place. On the other hand big business, now realizing, that Big is not enough, also do not have the capacity to do basic things like till the soil , plant the seeds, weed the garden and soon, has seen the economic destruction of lower production, dwindling market share, strikes and uncertainty of tenure. They have been seduced by the “being big feel”;alienated from poverty and joblessness. Yet we have the basics: land, people. What both government and big business have forgotten is that you have first to be small before you can be big. What do you need to grow: a safe supporting environment the “small” and the weak and vulnerable must be given sustenance and training and encouragement and sunshine and good soil that provide not only nutrients but also a place for roots to grow and become fruit bearing. Government and Big Business in South Africa do not provide for SME as good parents would provide for the young. SME’s say they need finance, training, access to markets but that is also to an extent wha tBig business and government needs in varying degrees. What SME’s need is an economic empowering environment that is in place even before an entrepreneur or SME proprietor has an idea? That idea when articulated needs good soil before to will become small and eventually an oak tree. The South African economic soil is not being enhanced because the model and strategy to do this effectively is resisted by both Government and Big business. The model at the most basic level requires an engagement with SME in partnership, where together,they create the conditions for growth and job creation. This is very strange, as our constitution says we must consult and grow together. We do this when we write laws, labor, for women youth and children rights, taxes and so onbut we do not do SME. Academic and civil servants talk about SME and not with them This is too understandable. There is no one voice for SME. For this SME must take full responsibility. SME’s by their nature are fragmented, drawn in different and conflicting directions,aggressively seeking safety and protection and those who have worked among SME will tell it is not unlike controlling a group of teenagers. They have all the physical development even to produce children but they do not have the experience and wisdom of seeking partnership and focusing on a common agenda which is pro SME. So what is missing for the building of and economic empowering environment. A pact between Government, Big Business and SME jointly derived from consultation. An agreement to place SME at the centre of our growth and jobs strategy. It is not difficult– our constitution has already set the rules of engagement. It is not difficult because it will not cost the tax any more. It is not difficult because it has been tried successfully for example in Brazil by way of the SEBRAE SME model. It is difficult because of the mistrust between government and business. It is difficul tbecause of the lack of social cohesion. It is difficult because neither big businesses nor government have the competency for SME development It is possible if partnership is valued and politely leadership displayed. It is possible if we all will agree: SME’s are the expression of free initiative, social inclusion and citizenship. Along these lines SME’s directly and indirectly influences the life of entrepreneurs, associates, employees,suppliers, family members and the entire social chain. SME’s are the democratization of opportunity.
Posted on: Thu, 10 Oct 2013 14:05:20 +0000
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