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09 July 2024 | Story André Damons | Photo Stephen Collett
Thought-Leader panel discussion July 2024
The University of the Free State (UFS) hosted its UFS Thought-Leader panel discussion in collaboration with the Free State Literature Festival, featuring Gert Coetzee, former editor, Volksblad (left); Sanet Solomon, Lecturer, Department of Political Sciences, Unisa; Prof Francis Petersen, Vice-Chancellor and Principal of the UFS (centre, facilitator); Ebrahim Fakir, Consultant Election Analyst, Electoral Institute for Sustainable Democracy in Africa (EISA); and Prof Erwin Schwella: Director, Centre for Good Governance in Africa, School of Social Innovation, Hugenote Kollege.

Even though there might be concerns about South Africa’s newly established Government of National Unity (GNE) and the associated challenges, there are also hope, optimism, and a lot of opportunities that come with this new reality.

This was according to the panellists at the University of the Free State (UFS) Thought-Leader panel discussion, titled Navigating a new era of democracy in South Africa. The discussion took place on Thursday (4 July) as part of the 2024 Thought-Leader Series presented in collaboration with the Free State Literature Festival. The discussion was facilitated by Prof Francis Petersen, Vice-Chancellor and Principal of the UFS.

The panellists included Ebrahim Fakir, Consultant Election Analyst from the Electoral Institute for Sustainable Democracy in Africa (EISA); Prof Erwin Schwella, Director of the Centre for Good Governance in Africa, School of Social Innovation at the Hugenote Kollege; Sanet Solomon, Lecturer in the Department of Political Sciences, College of Human Science at the University of South Africa; and Gert Coetzee, former editor of Volksblad.

Substantive uncertainty

Fakir started the conversation by saying that over 30 years, South Africans have experienced the use of authority without accountability and power without responsibility. The seventh democratic elections may usher in a new era – an era of substantive uncertainty.

“Substantive uncertainty is important for any democratic society, because it means that anyone who wishes to acquire power can no longer simply rely – as the governing party has for the past 30 years of our democracy – on the support of voters in an unqualifying way. Which means that in a year of substantive uncertainty, a key aspect and a key element of democracy, namely uncertainty, comes into play.

“In so far as uncertainty and substantive uncertainty can be a boon in a democracy, it can also be a bust. Why? Because substantive uncertainty comes not just with the uncertainty of political parties assuming a level of political support in society, it also means that a set of rules by which we engage in political behaviour become uncertain.

“One of the most interesting features post the 29 May elections is the uncertainty about the formation of the government. There are no rules governing how coalition must or should be formed. There are no guiding principles on how this should happen,” said Fakir.

According to him, there are potential benefits, but also significant risks. The first benefit is that there is now space for citizen activism and for influence of political parties.

“There are significant risks to what we do now. If there is going to be a fundamentally new policy regime, in what direction will this flow? I think we must hold out hope for this new form of coalition government, but we shouldn’t be blind to the fact that there are two significant features that will impact the evolution of this GNU: South Africa goes to a local government election in two years’ time.”

“The ANC goes into its own elective conference in a few years’ time when President Ramaphosa comes up for a potential replacement. And this is a significant risk for how the GNU evolves and which partners continues to remain in this, and which don’t.”

No trust in a single political party that governs

One of the things that started happening in 2019/2020 was a push for people to select their government not only from political parties, but also to have individuals representing them at national level. This led to the introduction of the Electoral Amendment Bill. This all came together with the 2024 election where you had independent candidates participating.

“For a number of years, South Africa enjoyed a single party-dominated state, where you had stability in terms of how your country would be governed and who would be in government. The drop in the support of the ruling party has created a lot of challenges and a number of concerns for people,” Solomon said.

According to Solomon, this does not necessarily have to be a scary time for the country, as one of the great things about democracy is that it moves. Eventually, all democracies move from a single party that dominates to a more competitive democracy.

“This is also something to be excited about. One of the concerns was that South Africa could be like Germany where it took six months to form a government, but fortunately we didn’t find ourselves in a situation like that.”

“While there are a lot of concerns, I think the results from the 2024 elections showcases that South Africans don’t necessarily trust a single political party to govern the country, but rather want different political parties to come together. While this GNU will come with challenges, I also think it holds many opportunities,” she concluded.

A new ethos is needed

Prof Schwella introduced three sets of variables; the first is somewhat philosophical and therefore on the level of inspiring ideas. The second is much more institutional. It links to having all the ideals of democratic government and governance, but is it governable? This links to the third, which is more practical, namely – can you implement it impactfully?

According to him, the current disposition has hopefully relieved the country from not only continued state capture, but from the capture of inertia to create new, exciting, and inspirational opportunities.

“A new ethos of continuous quality improvement at the level of implementation through a process of assessing needs to be established, which will then have to be continuously built back into the redesign of the system. There is a lot of hope and optimism in that.”

“Share that journey with us, co-create an exciting and prosperous new South African state. We nearly lost it in the first 30 years of democracy. We stuffed it completely under apartheid. But now is the opportunity. Now is the chance. Let's get together and just do it.”

Be careful of what you wish for

For Coetzee, the way forward is not clear cut, and the country now has a window of opportunity. How this opportunity will be managed is what will set the future, he said.

“We can see where we are now and the main positive of the government of national unity is that we have a government of national unity – a little more than a month ago this would have been unthinkable.”

He talked about the composition of the cabinet and said the DA should be careful of what they wished for.

“The DA got six very important portfolios. Which enables them to make a huge difference, but each of these portfolios can also be a poisoned chalice. Of course they have Home Affairs, so if there's a delay with my passport now, I'm going to be fed up with the DA.”

News Archive

Inaugural lecture: Prof. Phillipe Burger
2007-11-26

 

Attending the lecture were, from the left: Prof. Tienie Crous (Dean of the Faculty of Economic and Management Sciences at the UFS), Prof. Phillipe Burger (Departmental Chairperson of the Department of Economics at the UFS), and Prof. Frederick Fourie (Rector and Vice-Chancellor of the UFS).
Photo: Stephen Collet

 
A summary of an inaugural lecture presented by Prof. Phillipe Burger on the topic: “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

South African business cycle shows reduction in volatility

Better monetary policy and improvements in the financial sector that place less liquidity constraints on individuals is one of the main reasons for the reduction in the volatility of the South African economy. The improvement in access to the financial sector also enables individuals to manage their debt better.

These are some of the findings in an analysis on the volatility of the South African business cycle done by Prof. Philippe Burger, Departmental Chairperson of the University of the Free State’s (UFS) Department of Economics.

Prof. Burger delivered his inaugural lecture last night (22 November 2007) on the Main Campus in Bloemfontein on the topic “The ups and downs of the South African Economy: Rough seas or smooth sailing?”

In his lecture, Prof. Burger emphasised a few key aspects of the South African business cycle and indicated how it changed during the periods 1960-1976, 1976-1994 en 1994-2006.

With the Gross Domestic Product (GDP) as an indicator of the business cycle, the analysis identified the variables that showed the highest correlation with the GDP. During the periods 1976-1994 and 1994-2006, these included durable consumption, manufacturing investment, private sector investment, as well as investment in machinery and non-residential buildings. Other variables that also show a high correlation with the GDP are imports, non-durable consumption, investment in the financial services sector, investment by general government, as well as investment in residential buildings.

Prof. Burger’s analysis also shows that changes in durable consumption, investment in the manufacturing sector, investment in the private sector, as well as investment in non-residential buildings preceded changes in the GDP. If changes in a variable such as durable consumption precede changes in the GDP, it is an indication that durable consumption is one of the drivers of the business cycle. The up or down swing of durable consumption may, in other words, just as well contribute to an up or down swing in the business cycle.

A surprising finding of the analysis is the particularly strong role durable consumption has played in the business cycle since 1994. This finding is especially surprising due to the fact that durable consumption only constitutes about 12% of the total household consumption.

A further surprising finding is the particularly small role exports have been playing since 1960 as a driver of the business cycle. In South Africa it is still generally accepted that exports are one of the most important drivers of the business cycle. It is generally accepted that, should the business cycles of South Africa’s most important trade partners show an upward phase; these partners will purchase more from South Africa. This increase in exports will contribute to the South African economy moving upward. Prof. Burger’s analyses shows, however, that exports have generally never fulfil this role.

Over and above the identification of the drivers of the South African business cycle, Prof. Burger’s analysis also investigated the volatility of the business cycle.

When the periods 1976-1994 and 1994-2006 are compared, the analysis shows that the volatility of the business cycle has reduced since 1994 with more than half. The reduction in volatility can be traced to the reduction in the volatility of household consumption (especially durables and services), as well as a reduction in the volatility of investment in machinery, non-residential buildings and transport equipment. The last three coincide with the general reduction in the volatility of investment in the manufacturing sector. Investment in sectors such as electricity and transport (not to be confused with investment in transport equipment by various sectors) which are strongly dominated by the government, did not contribute to the decrease in volatility.

In his analysis, Prof. Burger supplies reasons for the reduction in volatility. One of the explanations is the reduction in the shocks affecting the economy – especially in the South African context. Another explanation is the application of an improved monetary policy by the South African Reserve Bank since the mid 1990’s. A third explanation is the better access to liquidity and credit since the mid 1990’s, which enables the better management of household finance and the absorption of financial shocks.

A further reason which contributed to the reduction in volatility in countries such as the United States of America’s business cycle is better inventory management. While the volatility of inventory in South Africa has also reduced there is, according to Prof. Burger, little proof that better inventory management contributed to the reduction in volatility of the GDP.

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