South Africa Needs a New Direction – by Editorial Board (Bloomberg News – July 12, 2017)

https://www.bloomberg.com/

Unless something changes, it’s on the fast track to an economic disaster.

The International Monetary Fund just pointed out that “South Africa’s vulnerabilities have become more pronounced.” That’s one way of putting it. A potentially prosperous and dynamic economy is on the fast track to ruin. Altering its course will take real political reform.

Unemployment has risen five percentage points since 2008, to a hope-crushing 28 percent. The country’s population is expanding faster than its economy, which lately has grown at less than half the rate of sub-Saharan Africa as a whole. And its inequality is among the highest in the world.

These are the fruits of failed economic policy. Yet far from grasping the need for change, at a recent conclave of the ruling African National Congress, President Jacob Zuma championed ideas for entrenching his dominance and enriching his supporters.

He’s trying to engineer the succession of his ex-wife, Nkosazana Dlamini-Zuma, as head of the ANC. And he’s pushing his program for “radical economic transformation” — a toxic brew of all-too-radical populist policies.

Zuma wants, among other things, to change the constitution to let the government expropriate land without compensation, for the benefit of the black majority. He wants to force the country’s beleaguered mining companies to transfer more shares, and the proceeds from a levy on revenues, to black investors.

For the rest of this article: https://www.bloomberg.com/view/articles/2017-07-12/south-africa-needs-a-new-direction

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