Item 1152 - Economic Needs of South Africa : Speech of Nelson Mandela at the Luncheon Of Business Leaders of Houston Texas

TRANSCRIPT

Chairperson:

Our distinguished host, Mrs de Menil:

Friends, Ladies and Gentlemen:

Allow me to express our profound appreciation for receiving us this afternoon and for your support over the years for our struggle for freedom and human dignity.

I am certain that among us there will be agreement that political democracy is incompatible with the absence of democracy in economic life. Furthermore, referring to our own specific case in South Africa, there is no gainsaying the fact that a vibrant, strong and growing economy is an imperative to underpin the new democratic order towards which we are advancing.

It is against this background that we welcome the opportunity to speak to you today about the economic needs of South Africa.

The South African economy is in need of fundamental restructuring. For decades, the white minority has used its exclusive access to political and economic power to promote its sectional interests at the expense of the black majority.

Today South Africa has one of the worst distribution patterns of income and wealth in the world. The economic deprivation of millions of people has created a fertile base for the violence and instability now engulfing our country.

Since the mid-1970’s the South African economy has stagnated, with a continuous fall in the per capita growth of the gross national product. Average incomes have fallen while unemployment has risen dramatically.

Policies pursued by both government and business have filed to have any impact in terms of reversing these trends. Nothing has been done to alleviate endemic and increasing poverty and the yawning racial inequalities. Thus our country has entered the 1990’s with the economic crisis further deepening.

In this light of all this, it is clear that any sensible economic policy on South Africa must address the related issues of poverty, inequality, stagnation, and the high concentration of wealth in a few white hands.

We are convinced of the potent role of the enterprising spirit of our people, their individual initiative, imaginative character and entrepreneurship. This is critical for sustained growth.

Having said this, Mr Chairman, we also do not believe that the free market alone can deal with the structural imbalances and inequalities that are the result of centuries of colonial and apartheid rule.

Our view is that laissez faire economics can only deliver a fair distribution of incomes if individuals have reasonable equal opportunities to succeed. The need to create equal opportunities and level the competitive playing field is obvious and self evident. Any democratic government would have to attend to this.

South Africa’s economic survival depends on our country’s ability to train and develop its vast reservoir of human resources for the benefit of all its people.

With increased internationalisation and globalisation of the economy, our country will face stiff and fierce competition in all areas, including trade and investment.

Competitiveness, productivity, innovation and capability in the management of new technologies will be determined by the quality of our human assets.

With your cooperation and assistance, the democratic order in South Africa will succeed to give high priority to human resource development, not only with regard to the allocation of expenditures, but also in terms of the content, quality and relevance of training programmes.

We would like to believe that you can assist us by training and developing our people to acquire technical and management skills now and not tomorrow.

It might also be important to make a few remarks about the respective roles of both the state and private sectors in putting our economy on a new growth path.

We are committed to the creation of a missed economy which will foster cooperation between the state, private companies, financial institutions, trade unions and other organisations of civil society. We would further argue that longer term development objectives should have priority over short term sectional interests.

The role we visualise for the democratic South African state when it is born, is not dissimilar to that played by the Malaysian government since the 1970’s, resulting in a growth rate which has averaged 9 per cent between 1970 and 1990.

We believe that the democratic state will have to play a leading role in education, rural development, housing, health, welfare, electrification, water provision, telecommunications and the infrastructure in general.

But what about the private sector? The ANC has never doubted the role and importance of the private sector in the creation of wealth. Neither have we doubted the potential of the private sector as the engine of economic growth.

Our policies would strive to encourage a more equitable and efficient ownership pattern in the private sector. Particular attention would be given to anti-trust and anti-monopoly legislation, such as you have in this country, which we believe would enable us to promote better competitiveness and efficiency within the private sector and the development of a truly free market.

Our policies would therefore support a dynamic, efficient and competitive private sector while encouraging cooperation with the public sector. It is out of this cooperation that we expect to see a positive impact on such areas as growth, job creation, the war against poverty and economic empowerment of the black people.

The question you might be asking yourselves is how you fit into this scheme of things. We believe that as part of the international business community, you have a role to play in our country, especially as investors.

There can be no question or disagreement about the potential contribution of foreign direct investment in the productive capacity of our new democratic country. It is clear that the new democratic state will need massive flows of foreign investment, if we are to succeed in meeting the needs of our people.

However, we believe that such foreign investment should complement rather than domestically derived investment and productivity. Foreign investors, such as yourselves, transnational corporations and small to medium sized enterprises, will be crucial to our efforts to restructure and regenerate our economy.

We in the ANC are aware and not blind to the need to pursue policies that would attract foreign investment, to our mutual benefit. Investor confidence is of course a critical factor. We are of course also mindful of the fact that there is severe competition internationally for capital.

Together with you as investors, we are interested to create the situation in South Africa in which there would be political stability , consistent, predictable and clear-cut macro-economic policies, large, growing and accessible markets, security and safety of investments including repatriation of profits and capital, as well as a well-trained, flexible and productive work force.

If these conditions exist, we are certain that you as investors would not hesitate actually to invest in South Africa.

We want to believe that prospective investors, such as yourselves, should now begin the process of serious preparations to enter the new non-racial and non-sexist, democratic South Africa. Preparations for such investments do take time.

Those who decide to wait and see might find that they have sidelined themselves. We ourselves would not to see this happen.

The ANC does not claim to have the monopoly to the solution of our economic challenges, but knows that if the needs of our people are not met, the political settlement which is in sight will be threatened. Its long term viability and sustainability will be subject to question.

It is against this background that we have not only entered into vigorous debated with other key players in South Africa in our quest for national consensus on economic priorities and strategies, but welcome suggestions and other points of view from our friends and key players overseas, such as yourselves.

It is in this context that we thank you most sincerely for giving us this opportunity to share with you our humble views in the economic needs of South Africa. We hope this meeting marks the beginning of a mutually beneficial partnership between ourselves.

Thank you.