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In President Jacob Zuma's first address to the South African Parliament on the state of the nation this week, he promised to create half a million jobs in the next six months. It would seem this is to be done by going on a R787 billion spending spree in the hopes of attracting private investment.
Perhaps President Zuma was drawing inspiration from U.S. President Barack Obama, who promised last November to create 2.5 million jobs within two years. But similar promises made elsewhere in Africa in recent years do not augur well for Zuma's hopes.
In Kenya, after the 2002 elections, President Mwai Kibaki also announced the creation of half a million jobs. The government went on to lay off tens of thousands of civil servants, even though the economy grew an average of six percent between 2004 and 2007.
In 2005, President Hosni Mubarak of Egypt promised during an election campaign to create 4.5 million jobs over six years, or 750,000 a year. How desperately Egypt needed that to happen – with one-fifth of its people living on less than one dollar a day, its economists say it needs to grow at more than six percent a year just to absorb its hundreds of thousands of graduates. By the government's own estimates, it was able to create only 390,000 jobs last year.
The assumption that government can create sustainable employment borders on the absurd. Granted, a leader should be optimistic, holding the bar high for a nation's performance. But South Africa's own record of job creation doesn't measure up. Between 2004 and 2007, 950,000 jobs were created, mainly as a result of an infrastructure and public works boom.
Foreign direct investment (FDI) is by no means the panacea for a developing country whose economy is in contraction. South Africa is the third-largest destination of FDI on the continent, after Morocco and Egypt, yet investment projects created only 10,000 jobs in 2007. In Egypt, the figure for the same year was 11,500 jobs.
What governments can do is to facilitate and stimulate job creation through sound fiscal and monetary policy, which would include removing bureaucracies associated with starting and registering businesses, ensuring the protection of property rights and building social capital by investing in sectors such as education and health.
One does not need to look far over South Africa's borders to see the effects of the global recession. Botswana has grown consistently over the last 40 years and has been praised for its resource management and curbing of corruption. Yet the African Development Bank has just approved a loan of U.S. $1.5 billion for budget support as a direct result of the falling prices of commodities, principally of diamonds.
The government appears to hope that the 2010 World Cup soccer tournament will generate a demand for goods and services justifying public investment. Here again, the track record is murky. Historically cities hosting the Olympic Games have experienced inflated housing prices, a loss of jobs and high debt levels. This is not to say that the World Cup cannot boost the South African economy. But its benefits will depend on quality of economic governance.
The South African government should be responding to the global economic crisis by anticipating a slowdown and shifting resources across sectors accordingly. President Zuma should have assured the South African people that his government is engaged in careful and focussed strategic planning, not wishful thinking.
Nancy Dubosse works for the economic governance programme of the Institute for Democracy in South Africa.
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WE will not discredit or discourage the hope that President Zuma has. However, President Zuma needs to know that it is not a good for him to make promises that he cannot keep. I said the word PROMISE. Attempting to create half a million jobs is one thing, but to say you promise is another. If he does not create half a million jobs, then he has showed his citizens that he is a lier. Because he said he Promised.
I do hope that Mr President will fulfil his promises of saying that half million jobs wll be created for South African over the next few six months to come.The motive behind of this is that since he has been in the politics with the leaders over the past years may be he discovered that gap even though he didnt had power by then, so now is the chance for him to prove to the nation.From MR Pain @ UZ
If Zuma and Mbeki had spent all those billions on local arms procurement and not overseas, he might have created that number of jobs. It was just self enrichment that made them virtually close down our local arms industry which South Africa will rue for the next generation.
Angaas, under President Mbeki South African economy prospered and jobs were created. There was more credibility of South Africa international, under Mbeki. Under Apartheid a few prospered, at the expense of the majority. Your comments just remind us just how bitter white minorities have become and largely cynical.
Nancy Dubosse's article about Zuma is typical of articles coming out of the so called institute of democracy for Africa in Cape Town. The students and articles they produce tends to have a neo-colonial bias about all things Africa. A lots of preaching about what is wrong with Africa as oppossed to what is going on now.
Zuma lost the Cape, which is very white/colored and tends to disagree with the black majority. Rather than call Zuma wishingful thinking, why not hold him accountable for his words. Africans need to be sceptical about articles from this neo-colonial institution. Cape Town is so different from the rest of Africa, one wonders what right Captonians have of lecturing Africa!
A lot of white/Black conflicts in Capetowm. And probably vey snobbish and out of date anglo's who are a major problem in Southern Africa. The articles from this institute bother me and they are a red flag of neo-colonial and aparthied mentality!!!!
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