How social security policies and economic transformation affect poverty and inequality: Lessons for South Africa

This article examines how various characteristics of social and economic policy frameworks affect poverty and inequality levels in developing countries, principally in Botswana and Mauritius. The research findings suggest that poverty and inequality are lower in countries with generous and broad-based – rather than pro-poor – social security policies, and where social policies are complemented by economic policies promoting economic transformation rather than mere economic growth. While South Africa's challenges of combating poverty and inequality are shaped by its own historical context, the lessons from other countries offer the opportunity to reflect on the social consequences of various social and economic policy mixtures. In particular, it may be worth considering how to bridge the divide between the economically productive contributors to social security policies and the economically marginalised beneficiaries of such policies.     

Japanese industrial development Lessons for South Africa?

This paper is critical of the scenario planning approach which attempts to offer a formula for development for South Africa in the 1990s based upon the success of Japan, amongst other economic ‘winners’. It is argued that the complexities and debates surrounding Japanese modernization make the application of ‘lessons’ extremely problematical. Points of controversy arising out of the two ‘miracle’ periods of Japanese economic growth, the Meiji era of the nineteenth century and post World War Two era, are examined in some detail. The Tokugawa legacy, Japanese ethics and in particular Confucianism, capital formation and investment spurts, the agricultural contribution, militarism and economic gains from warfare, the role of the state, the zalbatsu and business structures, dualism, labour supplies, export performance and finally education are all factors central to the debate on causes of economic growth in Japan. The paper concludes with some suggestive and very tentative ideas about ‘lessons’ for South Africa.     

Recession and the informal sector in South Africa

Despite the recent avalanche of writings investigating the informal sector, scant consideration has been accorded to the impact of an economic recession upon the growth and complexion of the informal sector.The object of this paper is to reflect upon the likely consequences of economic recession upon the South African informal sector in light of the extant international literature. Two different sets of processes are identified as impacting upon the growth and composition of the informal sector. The first suggests that the growth of the informal sector is the consequence of the lack of expansion of the formal sector. The second argues that much of the expansion in the informal sector is directly linked to its integration with formal sector enterprises. Under recessionary conditions, it is suggested that the growth of the informal sector may occur as a refuge from destitution but that the complexion of the informal economy will shift and be dominated by activities of a more ‘socially unacceptable’ nature.     

Taxation and tax reform in LDCs: Lessons for South Africa

Taxation in South Africa will increasingly have to focus on political and economic developmental demands. Two important lessons from the experience of developing countries with taxation and tax reform are that the tax system should aim at not taxing the poor (rather than trying to level down the income of the rich) and that tax policy has a special role to play in generating revenue for development, a role which it should endeavour fill in a neutral way. With these lessons in mind taxation and tax reform are analysed in South Africa. It is concluded that the tax system is relatively efficient but that there has been retrogression in attaining equity objectives.     

Land reform: Lessons for South Africa from the Republic of China on Taiwan

Before the implementation of land reform in 1949, the skewed distribution of land ownership and the unhealthy tenancy system in the Republic of China on Taiwan was of great concern to the Kuomitang Nationalist government. Apart from hindering economic development, it also threatened the social and political stability of the island. Taiwan is today regarded as one of the newly industrialized countries. Its remarkable economic achievements are to a large extent closely linked to the successful execution of a land reform programme. Faced with similar problems of an unhealthy distribution of land ownership, policy makers and those who have influence on policy in South Africa can learn a great deal from the Chinese experience.     

Unemployment and aids: the social‐democratic challenge for South Africa

Addressing Aids and unemployment is one of the greatest challenges facing South Africa at present. Health and welfare interventions will be costly and are likely to meet with resistance from taxpayers. Expanding employment (which will help alleviate poverty and expand the pool of taxpayers) is thus necessary. An inclusive social accord could help, but only if organised labour is prepared to make concessions, as was the case in the new social accords in Australia, Ireland and the Netherlands.     

Integrative Public Leadership in the private sector in South Africa

Complex social issues exist in many emerging democratic contexts. It has been argued that boundary-crossing leadership is needed to overcome these issues. Scholarship has developed around this, arguing that leadership in these shared power contexts is different to leadership in hierarchical organisations. This study focuses on a sample of senior private-sector leaders in South Africa who have reached across sector boundaries, in their individual capacity, to make a difference. This extends the existing scholarship which has focused on public-sector and non-profit integrative leadership. The intention is to understand the relational context of their boundary-crossing work and to extend the concept of ‘Integrative Public Leadership’. The leaders studied manage relationships with the government, their own company and multi-company partners within a historical context. The findings emphasise three understudied issues: own-company buy-in, historical context and ‘integrative’ conflict. A shared concept of integrative leadership, located in the African context, could further enhance practice.     

Revolution and reform of economic policies: Lessons for South Africa from China∗

The process of revolution in China itself his undergone profound reform. The most important reforms are reflected in a new direction of economic policies which focus upon a revival of market processes. This shift to greater reliance upon markets provides substantial support for similar programmes to be undertaken by South Africa and the developing nations of Southern Africa.     

The case for social security in South Africa: An economic perspective

Sound economic arguments exist for social security in a market system, since it can promote efficiency and equity. Furthermore, social security can reduce the risks of economic insecurities caused by unemployment, poverty and the new international economic environment to individuals and society. For a developing country, South Africa has a relatively well-developed social security system. However, it cannot address all the needs without major fiscal adjustments. The most viable approach may be to target only the most vulnerable groups, although such an approach may be criticised from an equity perspective. An important limitation of the South African social security system is that many unemployed individuals go without coverage, which may contribute towards instability. It may be necessary to revisit public works programmes in conjunction with the private sector.     

Civil society and the right to have access to social security in South Africa

This article examines transformation in South Africa's social security system from a human rights and civil society perspective. Three claims are made: rights can be realised by civil society organisations, civil society organisations can transform social security, and the realisation of social security rights by civil society organisations can give us a means to address many of the problems identified with the involvement of NGOs in development. The basis of this assessment is a performative conception of rights, derived from the Grootboom legal judgment, which would allow civil society action to address the problems inherent in the social security system in South Africa. An analysis is thus made of this kind of public action and it is shown how it can be subsumed under the 1996 South African Constitution, and how the Constitution could transform civil society organisations' social action. Civil society action, it is proposed, could be valuable in further reforming the South African social security system, and in realising rights as autonomous social action.     

Pro-poor growth and social protection in South Africa: Exploring the interactions

This study evaluates the impact of South Africa's long-term economic growth on household poverty and inequality between 1995 and 2005. We find a decline in aggregate levels of poverty, but increasing levels of inequality. The evidence suggests that the growth model provides substantial redistributive income support to the poor through the social grant programme, whilst offering few returns to those in the middle of the distribution.     

Mobile entrepreneurship: Informal sector cross-border trade and street trade in South Africa

This article presents the results of a study on the participation of non-South Africans in the handicraft/curio sector of street trade in South Africa in informal sector cross-border trade. The findings provide an introduction to the largely unexplored phenomenon of informal sector cross-border trade between South Africa and neighbouring states and challenge some of the common myths about non-South African street traders which pervade public discourses around migration. The Southern African Development Community (SADC) is presently involved in prolonged and contentious negotiations to establish a free trade area for the region based on the SADC protocol on trade and development. At the same time, against a backdrop of anti-immigrant rhetoric, the South African government is developing a new migration policy. The article argues that informal cross-border entrepreneurs should not be disadvantaged by the renegotiation of regional trade agreements and the reformulation of South Africa's new migration policy.     

Financial intermediation,regulation and the formal microcredit sector in South Africa

This article evaluates demand- and supply-side aspects of the formal microcredit sector in South Africa and the environment in which the sector is regulated. Although South Africa has a competitive financial sector relative to a sample of upper middle-income countries, the historical bias towards formal sector banking resulted in a lack of appropriate credit instruments for poorer people. In 1992, new regulations facilitated the legalisation of microfinance institutions and, by 2000, the sector had grown to over 2 per cent of total credit extended by the monetary sector, with over 1 300 institutions supplying microcredit to the public. The article presents the first statistics of different types of microcredit institutions as well as some of their disbursement trends, recorded since 1999 by the Micro Finance Regulatory Council. Thereafter, the demand for credit is assessed between 1995 and 2000, before best-practice regulation and South Africa's degree of compliance are discussed.