SOUTH Africa needed an intimate and healthy relationship between government and the private sector to be a developmental state in order to spur economic growth, political and trends analyst JP Landman said yesterday.
He was addressing business people at a breakfast in Port Elizabeth on how the country’s political and economic climate affected businesses.
Landman said companies were facing huge challenges due to a strained global economic environment.
He added that South Africa’s "political confusion” was also slowing the country’s economic growth rate.
"For example, is the ANC for or against nationalisation? They don’t even know. Does Mr Zuma know what to do with the economy? He doesn’t have the faintest clue. He is not bothered really, he has got other strengths.”
Landman also listed workers’ strikes, inequality, crime, and poor health and education systems as other factors that weakened the economy.
He said the relationships between government and business was not conducive to a developmental state.
"Let me ask you, do you feel that you get respect from government? No? Do you respect them? No you don’t because [you believe] they all steal, they are corrupt.
"That is not the kind of relationship that will improve growth.”
Landman said government’s interventions to create employment such as the jobs fund were welcomed but they were not going to "tip the scale”.
Contrary to popular belief in business circles, Landman said, concepts like social grants and the Public Works programme improved the lives of poor people.
"One of the biggest misconceptions in this country is that the rich are getting richer and the poor are getting poorer. That is rubbish. The poor are getting less poor. We have rolled poverty back.
"The Public Works programme creates short-term, temporary jobs. Sometimes people get coupons, but their lives are changed.
"You and I might not think so, but go ask them. I am a huge fan of social grants. It puts money in people’s hands.”
