The all-encompassing and wide-ranging 178-page diagnostics of the South African economy embedded in the report “Growth Through Inclusion in South Africa”, prepared by Ricardo Hausmann and his team from the Growth Laboratory at Harvard University, is a timely and relevant document.
Prof Raymond Parsons, economist from the North-West University (NWU) Business School, says the overall thrust of the analysis and proposals made not only confirm the extent to which South Africa's economic performance has badly deteriorated in recent years, but also makes valuable recommendations as to “doable” remedies and reforms that need to be urgently implemented.
“In particular, the Harvard report makes persuasive proposals to strengthen state capacity, which it sees as both a technical and political challenge, but also strong recommendations for achieving spatial inclusion in South Africa. Reassessing the efficacy of local government is also highlighted.”
He explains that the document outlines innovative steps to unlock South Africa's green growth potential in a decarbonising world, which is given great prominence in the Harvard study.
“Although the Harvard report inevitably recognises much of what has already been emphasised by other South African studies – such as the recent National Planning Commission’s extensive evaluation of the implementation failures of the National Development Plan – it still supplements and expands South Africa’s national agenda.”
Prof Parsons says it is valuable to again have authoritative external affirmation of what has gone wrong in South Africa and what needs to be done, together with opening up several new paths of policy decision-making.
“The Harvard analysis confirms that, ultimately, politics needs to be the solution to gridlock, ideology, overburdening of the state and political patronage. It also believes that there is scope for better mobilisation of the private sector and market forces to achieve South Africa’s socio-economic goals with greater success.”
According to Prof Parsons, the Harvard study is another serious reality check on South Africa’s poor economic performance and is one that should be read by all decision-makers in both the public and private sectors.
“It synthesises and expands our insights about what needs to be done urgently in South Africa to make a real dent on the triple challenges of unemployment, poverty and inequality. Although the basic message from Harvard is that, after the end of apartheid, the economy is now defined by stagnation and exclusion, the practical remedies and reforms mentioned by the study nevertheless offer valuable steps that will empower South Africa to build a bigger, stronger and better economy.”
