Scenarios for South Africa THE BMI-BRSCU STRATEGIC FORUM www.strategicforum.co.za THE STRATEGIC FORUM A place of assembly for strategic conversations Scenarios for South Africa Making the impossible happen Dr. Llewellyn B. Lewis

THE BMI-BRSCU STRATEGIC FORUM for strategic conversations www.strategicforum.co.za STRATEGIC FORUM A place of assembly for strategic conversations THE SCENARIOS FOR SOUTH AFRICA 2017 - 2020

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA www.strategicforum.co.za Pretoria will provide and other myths 3

Social transformation Economic transformation Political transformation THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA www.strategicforum.co.za Long walk to Freedom South Africa unchanged Ubuntu South Africa united Democracy Liberalised autocracy Social transformation 1994 Election 1999 Election Economic transformation Pretoria will provide South Africa entitled Autocracy Limited democracy Cry the beloved Country South Africa corrupted Political transformation

Drivers of Change and the SA Scenario Map www.strategicforum.co.za Social Transformation SA Social Capitalism; Growth through Redistribution; The Golden Triangle. Government intervention, PPP’s; Subsidies, Infrastructure GDP GROWTH > 5 % PA INFLATION 5 - 8 % PA EMPL GROWTH > 400 000 PA 3 - 5 % PA 8 - 10 % PA 150 - 400 000 PA 2 - 3 % PA 10 - 15 % PA 50 - 150 000 PA < 0 % PA 15 - 25 % PA < 50 000 PA 1. Ubuntu Scenario 2. Long Walk to Freedom SA Social Democracy; Redistribution with Growth 4. Cry the Beloved Country NO CONFIDENCE LOW AVERAGE HIGH CONFIDENCE Risk Avoidance Risk Aversion Risk Tolerance Risk Taking Economic Transformation NOW, Muddling along as we are, or change . . . SA Communism; Redistribution with or without growth SA – A Third World Country 3. Pretoria will Provide Closed System Open System Paradigm Regression Paradigm Paralysis Paradigm Shift Paradigm Reinvention Racial conflict Racial tension Racial tolerance Racial reconciliation (Ubuntu) Political Transformation (Based on Gerald Harris: The Art of Quantum Planning: 2009)

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Performance of South Africa on Key Uncertainties

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Impact of Strategic Issues on South Africa

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Availability of Key Capabilities on South Africa BMI-BSCU

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Impact of Stakeholder Power and Interest

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Performance on Criteria for Achieving Growth

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Performance of South Africa on the Golden Straitjacket* * When it comes to the question of which system today is the most effective at generating rising standards of living, the historical debate is over. The answer is free market capitalism. When a country recognises the rules of the free market in today’s global economy, and decides to abide by them, it puts on the Golden Straitjacket. To fit into the Golden Straitjacket a country must either adopt, or be seen to be moving toward, the golden rules. (The Lexus and the Olive Tree: Tom Friedman: 1999, 104)

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Likelihood of Integration of SA Society in the Short-, Medium- and Long-term

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Current Reality of Political Transformation in South Africa

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Current Reality of Economic Transformation in South Africa

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Current Reality of Social Transformation in South Africa

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA The State of The Nation Experienced

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Outlook for the State of the Nation

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Outlook for the State of the Nation

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Making Sense of the future of SA: Current Reality vs Strategic Forum Scenarios

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Making Sense of the future of SA: Current Reality vs Strategic Forum Scenarios

KEY DRIVERS OF CHANGE SHAPING THE SA SCENARIO www.strategicforum.co.za Deregulated Market Economy. Driven primarily by private investors Lower Middle Road The state restricts citizens’ access to feedback mechanisms in order to introduce unpopular economic reforms, such as deregulating the labour market. ************************************************** South Africans are poor but unfree. High Road Rapid economic deregulation boosts private investment and economic growth; Citizens reward the ruling party at the polls. ************************************************* South Africans are prosperous as well as free. Most citizens have access to feedback mechanisms Most citizens lose access to feedback mechanisims Low Road State intervention in the economy undermines investor confidenceand growth. To avoid losing power, the government restricts citizens’ access to feedback mechanisms. ************************************************** South Africans are poor as well as unfree. Upper Middle Road The government fails to reform the economy, which continues to languish. Citizens remove the ruling party from power. ************************************************** South Africans prosperous but also unfree. Heavily regulated economy, directed by the state (Source: Based on A time travelers guide to our next 10 years: Frans Cronje: 2014 )

Economic Transformation THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA www.strategicforum.co.za UBUNTU South Africa united Medium to High growth Medium to Strong Opposition Entrenched Democracy Non Racist, Non Sexist, Reconciled Nation LONG WALK TO FREEDOM South Africa unchanged Average to Medium growth Weak to Medium Opposition Espoused Democracy Tolerant Nation PRETORIA WILL PROVIDE South Africa entitled Average to Weak growth Weak to non- existent Opposition Shaky Democracy Tense Nation CRY THE BELOVED COUNTRY South Africa corrupted Weak to Negative growth One Party State Ignored Democracy Divided Nation The future of South Africa depends on progress along the three axis of POLITICAL-, ECONOMIC- , AND SOCIAL TRANSFORMATION. The solution lies in an approach that inextricably links economic policy, social development and transformation. The UBUNTU scenario requires an entrenched democracy, a reconciled Nation, united behind a common vision, an open Economic system, the alleviation of poverty and social delivery of housing, health and education. GDP GROWTH > 5 % PA INFLATION 5 - 6 % PA EMPL GROWTH > 400 000 PA 3 - 5 % PA 7 - 10 % PA 150 - 400 000 PA 2 - 3 % PA 11 - 15 % PA 50 - 150 000 PA < 0 % PA 16 - 25 % PA < 50 000 PA Social Transformation Economic Transformation Risk Avoidance Risk Aversion Risk Tolerance Risk Taking NO CONFIDENCE / LOW / AVERAGE / HIGH CONFIDENCE Closed System Open System April 1994 Elections The Political Miracle One Party State Multi-Party Democracy Political Transformation Closed System Open System Paradigm Regression Paradigm Paralysis Paradigm Shift Paradigm Reinvention Racial conflict Racial tension Racial tolerance Racial reconciliation

THE BMI-BRSCU STRATEGIC FORUM SCENARIOS FOR SA Making Sense of the future of SA: Current Reality vs Strategic Forum Scenarios OPEN SYSTEM 40% 10% Lower Middle Road Pretoria will Provide Scenario High Road Ubuntu Scenario RACIAL CONFLICT RECONCILIATION AND NATION BUILDING Low Road Cry the Beloved Country Scenario Upper Middle Road Long Walk to Freedom Scenario 20% 30% CLOSED SYSTEM 23