As the ruling party wrangles over factional battles and the rule of withdrawal for its members facing corruption or criminal charges, South Africa is burning – literally and figuratively. Protests against service delivery failures are mounting and the economy is collapsing. Politicians lose sight of the real issues.
First published in the Daily Maverick 168 weekly newspaper.
Tryston Stretton, co-owner of a restaurant in the hippie suburb of Joburg in Melville, offered a cruelly brutal description of how his restaurant managed to survive the Covid-19 lockdown that tore the economy apart.
“We broke our balls to keep our doors open and all of our staff employed. We were able to do this without the support of anyone, including the government, ”Tryston, who owns Spilled Milk with his brother Jarrod, told DM168.
The timing of their foray into the hospitality and leisure industry in South Africa was ill-timed. The Stretton brothers bought Spilled Milk nine months ago when the country was in lockdown level four, preventing patrons from dining at restaurants as public life and movement were severely restricted. It was a good deal from the previous owner, who opened Spilled Milk in Melville three years ago, says Tryston.
To keep the restaurant’s doors open and all eight of its staff employed, the Stretton brothers immediately came out to make changes to the menu. They kept the menu items simple and the prices affordable, with the top selling item being the R40 ‘Recession Breakfast’. A similar meal would usually cost double the price in the northern suburbs of Joburg.
“Keeping employees at work has been a big priority for my brother and me. We’ve had the restaurant for nine months and for six of those months my brother and I didn’t take a salary. Every penny was spent to run the restaurant, ”says Jarrod.
Other restaurants on the famous 7th Street in Melville unfortunately did not survive. Before the lockdown, the street was bustling – attracting students, hipsters, working professionals and others. Take a walk down the street today and you’ll be faced with a stark sign of bankruptcy or business relocation. At least seven vacant spaces that previously housed small businesses now have “for rent” signs. Before the lockdown, the street was fully occupied.
Melville’s story is an approximation of South Africa’s economic decline as the scenario of dying businesses unfolded across the country.
To highlight this, a recent report from Statistics SA, which shows that a total of 216 companies (mostly small and medium-sized enterprises) in various sectors were liquidated in March 2021, up from 178 in February 2021, a jump of 21%. . Liquidations increased by 50% in March 2021 compared to the same period last year.
A liquidation involves a financially troubled business that closes its doors for good, resulting in job losses. South Africa is already facing an unemployment crisis as the unemployment rate, based on its broadest definition, is north of 40%.
The person on the street doesn’t need to remember how difficult things are. But pampered politicians, enjoying sheltered employment at taxpayer expense, clearly need a reminder that South Africa is in deep trouble.
Take the ruling ANC, for example. Its National Executive Committee (NEC) has arguably spent a great deal of time and energy over the past few months debating factional politics and the rule of withdrawal for those facing corruption or criminal charges in the country. place of the socio-economic crisis affecting the country.
A DM168 analysis of statements on the results of recent NEC meetings released by the ANC this year indicates that the party’s factional machinations and internal organizational issues dominated its discussions and priorities.
The statements generally reflect the discussions of the NEC and the decisions made by the party leaders. But the four statements released this year detail the withdrawal rule, unity and cohesion within the ANC, and focus less on demonstrable ways to reform the economy or accelerate the deployment of the Covid-19 vaccine, which would stimulate the economy because it guarantees a return to normality.
In its statements, the ANC briefly mentions President Cyril Ramaphosa’s Reconstruction and Economic Recovery Plan, which was launched in October 2020 as a roadmap on how the economy would recover from the Covid pandemic. 19.
The implementation of the plan is progressing at an icy pace. Some of the pro-economic growth structural reforms proposed by Ramaphosa – such as freeing up the radio frequency spectrum and integrating more renewable energy players into the national grid – face administrative and legal delays. .
Other worrying economic problems are the resumption of load shedding by Eskom before the winter season; worsening financial pressures from consumers as most of the government’s Covid-19 relief measures (such as the R 350 per month social subsidy and payments from the Unemployment Insurance Fund) have ended; and an increase in the number of consumers turning to debt counseling (DebtBusters, a debt counseling company, saw the number of consumer inquiries for its services increase by 31% in the first quarter of 2021).
Economy aside, there is social unrest with more protests related to service delivery failures. The lockdown has intensified the incidence of gender-based violence and homophobic attacks.
It had a terrible impact on the education system. Primary school children in poor areas learned between 50% and 75% less in 2020 than the year before, according to the National Income Dynamics Study – Coronavirus Rapid Mobile Survey.
A way to get around politics
These are the issues that should be at the forefront of ANC NEC meetings, says Iraj Abedian, senior economist at Pan-African Investment and Research Services. “But the NEC spends its time wondering if this faction should outsmart this one. It’s a case of chefs playing with their toys while Rome burns down. South Africa is on fire, ”Abedian said.
So can the NEC afford not to focus on party politics?
“Maybe not,” he said. “If the Ramaphosa reform camp sleeps, the other guys in the response and radical economic transformation [RET] the camp will eliminate them – politically. They know it’s a sudden death case. And this is how they justify all the attention paid to NEC meetings on factional battles. “
Abedian is encouraged by a nation that is not apathetic; he is vocal and proactive in denouncing the ruling party and the government, especially on social media, for its bad decisions.
There is a bigger problem that goes beyond factional battles, says Dr Azar Jammine, chief economist of Econometrix. “Even if the RET camp is eliminated and Ramaphosa’s power base is strengthened, the huge challenge is how to repair the capacity of the state and get capable people to run the country and make the right decisions. It’s like running a huge oil tanker. It cannot be done quickly; it will take ages.
In the meantime, the nation will continue to be a spectator of political processes.
The Stretton brothers of Melville’s Spilled Milk are worried about the future. The third wave of Covid-19 infections could see the government reintroducing strict lockdown measures.
“It would be a final blow for small businesses,” Jarrod says. DM168
This story first appeared in our Daily Maverick 168 weekly newspaper which is available for free to Pick n Pay Smart Shoppers at these Pick n Pay stores.
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This notice was published: 2021-05-23 20:01:48