Читать книгу New South African Review 1 - Anthony Butler - Страница 28

Big business worked closely with the apartheid state to prop up the economy during the politically turbulent 1980s, when community and labour struggles were advancing and international pressure and economic isolation of the economy intensified. The economy was dominated by diversified conglomerates. These large groups bought up the assets of foreign companies that left South Africa. In fact, there seems to have been a reversal of capital flight during this period (Mohamed and Finnoff 2005). After democracy there was huge restructuring of the South African corporate sector, many of the largest conglomerates embarking on a process to increase their international operations and to reduce their South African businesses. In line with the demands of the shareholder value movement, they simplified their corporate structures and increasingly focused on core business activities when they restructured. In short, much of big business had diversified its businesses to reduce their exposure to the South African economy after 1994. At the same time, South Africa had a weak industrial structure focused around a minerals and energy complex because of the political, economic and historical processes that shaped its industrialisation. The corporate restructuring further weakened the industrial structure of the economy.

The economic policies of the new democratic government were aimed at attracting and appeasing foreign finance and investment. It was probably believed that foreign investment would pour into the new South Africa and reshape and modernise the industrial landscape. The economic policies were deliberately neoliberal because it was believed that foreign investors would be attracted to a country where the government was willing to show its credibility by ensuring low inflation and low budget deficits. The government did not adopt or implement an industrial policy to address the industrial structural weaknesses because of the fiscal implications and because their neoliberal policies favoured less state intervention in the economy.

The neoliberal macroeconomic and financial policy choices of the government proved disastrous. The policy choices left them unable to deal with the effects of financialisation and the corporate restructuring and deindustrialisation crisis in the economy. These policy choices further integrated the economy into the global economy and opened it to relatively uncontrolled hot money flows. The surges of hot money into and out of the economy led to volatility in macroeconomic variables such as exchange rates and interest rates and had a huge impact on liquidity in financial markets. The effect of this volatility was to exacerbate the declining interest in long-term, productive industrial investment and instead there was a misallocation of capital towards speculation in real estate and financial markets and debt-driven consumption.

The integration into global financial markets has increased the risk of financial crisis and the vulnerability to contagion from financial problems elsewhere. The weak industrial structure and continued dependence on mining and minerals exports creates a balance of payments risk because imports for consumer goods and capital equipment for mining and infrastructure investment have increased. The large corporations and wealthy South Africans with their liquid and mobile capital are able to respond to macroeconomic volatility and the risk of financial crisis in South Africa by moving their money abroad. The government’s policies have made this capital flight easier. Poor South Africans are forced to bear the brunt of the poor economic policy choices of their government. They have lost their jobs or have had the quality of their jobs reduced through outsourcing. They have become more dependent on government grants, such as child support and old age pensions. Unless there is a huge effort to address the industrial decline in South Africa and new economic policies implemented to support industrial growth and transformation, the majority of South Africans will face an increasingly bleak economic future.

NOTES

1 The quote is from the article ‘Defaults hit upmarket mortgages’, in Business Day, 14 May 2009 (available online at http://www.businessday.co.za/Articles/Content.aspx?id=71123). For another report on the state of the property market in 2008 and early, 2009 see ‘Auctions reveal the immediate truth and nothing but the truth’ published in Property: The Property Magazine, available online at http://www.thepropertymag.co.za/pages/452774491/Auctions/09/April/auctions.asp.

2 ‘Consumers struggle to hold onto their cars’, in Business Day, 1 April 2009, available online at http://www.businessday.co.za/Articles/Content.aspx?id=62152.

3 ‘150 000 Consumers under debt review by Christmas’, in Business Day, 1 September 2009, available online at http://www.businessday.co.za/Articles/Content.aspx?id=80240.

4 The NCR said in November 2009 that on average 80 per cent of new mortgages provided during June 2008 to June 2009 were to people whose gross income was over R15 000 a month.

5 See Terreblanche (2002) for an account of the response of white people and big business to the political changes.

6 For an interesting discussion on the growing influence of institutional investors and the emergence of maximising shareholder value as a ‘new ideology for corporate governance’ see Lazonick and O’sullivan 2000, p.13). It is worth noting that the growth in importance of the business media industry and their influence over business structure and executive behaviour is also significant.

7 Mohamed and Finnoff (2005) show that capital flight from South Africa was higher during the period after the democratic elections (1994 to 2000) than it was before the election (1980 to 1993). They argue that mis-invoicing of trade made up a significant share of capital flight, indicating that it was probably big businesses with large export and import volumes involved in mis-invoicing of trade.

8 The central place of workers’ struggles in the liberation struggle meant that the demands of the workers for labour relations reform were high on the agenda throughout the negotiations period and when the ANC took control of the government. The labour relations reforms were passed very quickly and by the time GEAR and more conservative policies were accepted, many within the ANC and the new state were giving a sympathetic ear to business when it complained about inflexible labour markets.

9 Omar and Webster (2004) examine the responses of management to changes in labour markets. They draw their conclusions from sociological studies of workplace and managerial changes in the mining industry, footwear manufacturers and call centre operators.

REFERENCES

Aglietta M and R Breton (2001) Financial systems, corporate control and capital accumulation. Economy and Society 30 (4).

Business Day newspaper (various editions).

Crotty J (2002) The effects of increased product market competition and changes in financial markets on the performance of nonfinancial corporations in the neo-liberal era. Working Paper no. 44. Amherst: Political Economy Research Institute, University of Massachusetts.

Duménil G and D Lévy (2004) Capital Resurgent. Cambridge, MA: Harvard University Press.

Epstein G (2005) Introduction: Financialization and the world economy. In Epstein G (Ed) Financialization and the World Economy. Cheltenham and Northampton: Edward Elgar.

Ernst & Young (2006) Mergers and acquisitions: A review of activity for the year 2005. Ernst & Young South Africa (available online at http://www.ey.com/ZA/en/Home).

Fine B and Z Rustomjee (1996) The Political Economy of South Africa: From Minerals-Energy Complex to Industrialization. Boulder: Westview Press.

Froud J, C Haslam, S Johal and K Williams (2000) Shareholder value and financialization: consultancy promises, management moves. Economy and Society 29 (1): 80–110.

Froud J, S Johal, A Leaver and K Williams (2007) Financialization and Strategy: Narrative and Numbers. New York: Routledge.

Goldstein A (2001) Business governance in Brazil and South Africa: How much convergence to the Anglo-Saxon model? Revista Brasileira de Economia Politica 21 (2): 3–23.

Lazonick W and M O’sullivan (2000) Maximizing shareholder value: a new ideology for corporate governance. Economy and Society 29 (1): 13–35.

Mohamed S (2006) Capital flows to the South African economy since the end of apartheid. Presented at the Annual Conference for Development and Change, Brazil, December 2006.

Mohamed S (2009) Financialisation, the minerals and energy complex and South African labour. Presented at the Global Labour University Conference, Tata Institute of Social Sciences, Mumbai, India, February 2009.

Mohamed S and K Finnoff (2005) Capital flight from South Africa: 1980–2000. In Epstein G (Ed) Capital Flight and Capital Controls in Developing Countries. Cheltenham and Northampton: Edward Elgar.

Mohamed S and S Roberts (2007) Questions of growth, questions of development. New Agenda: South African Journal of Social and Economic Issues 28: 37–46.

Nolan P (2003) Industrial Policy in the early 21^st century: The challenge of the global business revolution. In Chang H-J (Ed) Rethinking Development Economics. London: Anthem Press.

Omar R and E Webster (2003) Work restructuring in post-apartheid South Africa. Work and Occupations 30 (2): 194–213.

Orhangazi O (2005) Financialization and capital accumulation in the non-financial corporate sector: A theoretical and empirical investigation. Working Paper 149. Amherst, MA: Political Economy Research Institute, University of Massachusetts.

Presidency, Government of South Africa (2003) Towards a Ten Year Review: Synthesis report on implementation of government programmes. Pretoria: Policy Coordination and Advisory Services, The Presidency.

Roberts S (2005) Industrial development and industrial policy in South Africa: A ten year review. Presented at conference South African Economic Policy Under Democracy – A Ten Year Review, Stellenbosch, 28 and 29 October 2005.

Roberts S (2008) Patterns of industrial performance in South Africa in the first decade of democracy: the continued influence of minerals-based activities. In Transformation: Critical Perspectives on Southern Africa 65: 4–35.

Roberts S, N Chabane and J Machaka (2003) Ten Year Review: Industrial structure and competition policy. Unpublished mimeograph.

Roux A (1991) Financing economic development in South Africa. Unpublished mimeograph.

Stockhammer E (2004) Financialization and the slowdown of accumulation. Cambridge Journal of Economics 28 (5): 719–741.

Terreblanche S (2002) A History of Inequality in South Africa: 1652 – 2002. Pietermaritzburg: University of Natal Press.

Tregenna F (2008) Sectoral engines of growth in South Africa: An analysis of services and manufacturing. Working Papers RP2008/98, World Institute for Development Economic Research (UNU-WIDER).

Von Holdt K (2003) Transition from below: Forging trade unionism and workplace change in South Africa. Pietermaritzburg: University of Natal Press.