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07 March 2024 Photo SUPPLIED
Gcina Mtengwane teaches in the Community Development Programme at the Centre for Gender and Africa Studies, University of the Free State, Qwaqwa Campus.

Opinion article by Gcina Mtengwane, Centre for Gender and Africa Studies, University of the Free State.


The notion that 2024 could echo the transformative spirit of 1994 holds weight. South Africans find themselves in a pressing need for positive social, economic, and political change. Yet, the avenue through which this change will manifest - a reformed African National Congress (ANC), an opposition party or a coalition government - remains unchartered territory. South Africa is on a downward trajectory. As various international indexes project corruption and poor governance, noting also that those indexes may not at times be accurate, the lived experiences of South Africans echo despair, disillusionment, and a betrayal of promises for a better life, particularly among the working class and the poor. 

The first democratic election in 1994 heralded an era where a new government had the opportunity to represent the interests and aspirations of all citizens, countering the discriminatory policies of apartheid. It fostered optimism for equal access to opportunities and life chances regardless of race, religion, gender, class, or ethnicity.

However, the transition to democracy, like any new venture, brought forth both opportunities and challenges. Actualising the vision of a ‘rainbow nation’ necessitated tangible legislative reforms and macroeconomic strategies beyond mere rhetoric. Consequently, initiatives such as the Reconstruction and Development Programme (RDP) in 1994, the Growth, Employment and Redistribution (GEAR) strategy in 1996, The Accelerated and Shared Growth Initiative for South Africa (ASGISA) in 2005, the new Growth Path in 2010, and the National Development Plan vision 2030 were implemented. While the efficacy of these macroeconomic frameworks remains contested, there is a consensus that more can be done and perhaps differently.

Parallels between 2024 and 1994? 

South Africa grapples with high unemployment, alarming crime rates, and an education system ranked among the world’s worst. South Africa is among the most unsafe countries in the world with an estimate of 27 494 murders recorded in 2022-2023. Ranked at 50th out of 63 countries, its education system is rated among the worst performing in the world. The education system fails to equip matriculants with practical skills for sustainable livelihoods. Additionally, funding exclusions and high dropout rates plague higher education, exacerbating the crisis. NSFAS has proposed defunding certain qualifications from its budget and half of those who do make it to universities drop out in their first year.  Moreover, South Africa measures the highest income inequality in the world, with a Gini coefficient of around 0.67, race being a key factor in a society where 10 per cent of the population owns more than 80 per cent of the wealth.

Persistent income inequality and deeply entrenched racial disparities are hindering the opportunities for upward social and economic mobility for the majority, notably the youth. The unemployment rate among youth, which includes persons between 15 and 35 years old, is around 60%. There is low support for and a high failure rate of start-up small to medium enterprises (SMMEs) with between 70% to 80% failing in the first five years of operations. There is a high rate of youth neither in employment nor in education or training (NEETs).  Data shows that 32.6% of graduates struggle to find work within the first two years of graduation, implying that for some, regardless of educational attainment, there is no optimism regarding the prospects for a better future.

The issues highlighted above are just some of the issues facing South Africa. These challenges underscore the urgent need for well-conceived and actionable solutions. A governing party must demonstrate clear policy direction and effective implementation mechanisms to uplift the most vulnerable while safeguarding the rights of all citizens, irrespective of race. However, certain radical policy proposals, like affirmative action and land expropriation without compensation, pose significant ideological divides.

Opportunity to nurture democracy

South Africa boasts over 30 years of democratic experience, providing invaluable lessons from past elections. There is a unique opportunity to nurture democracy and freedom, as is enshrined in the constitution, ensuring the well-being of current and future generations. The prospect of a coalition government looms large, potentially marking a historic shift. While unprecedented at the national level, coalition governance has been trialled in various municipalities including Johannesburg, Nelson Mandela Bay, and Ekurhuleni. However, these experiments often resulted in governance failures, characterised by instability and policy dissonance, rather than cohesive leadership. Political rivalry among the parties undermined service delivery and good governance, leading to the failure of coalition governance at the local government level.

Policy misalignment emerges as the key impediment to coalition success. The recent formation of the ‘Moon-shot pact’ underscores the necessity for aligned policy positions among coalition partners to avert governance crises.

Voter implications

Voting entails entrusting a political party with the responsibility to serve the interests of millions. It demands an informed understanding of the party’s policies as outlined in its manifesto. While individual charisma may sway voter preferences, informed decisions are imperative amidst South Africa’s challenges and opportunities. 

News Archive

Producers to save thousands with routine marketing strategies, says UFS researcher
2014-09-01

 

Photo: en.wikipedia.org

Using derivative markets as a marketing strategy can be complicated for farmers. The producers tend to use high risk strategies which include the selling of the crop on the cash market after harvest; whilst the high market risks require innovative strategies including the use of futures and options as traded on the South African Futures Exchange (SAFEX).

Using these innovative strategies are mostly due to a lack of interest and knowledge of the market. The purpose of the research conducted by Dr Dirk Strydom and Manfred Venter from the Department of Agricultural Economics at the University of the Free State (UFS) is to examine whether the adoption of a basic routine strategy is better than adopting no strategy at all.

The research illustrates that by using a Stochastic Efficiency with Respect to a Function (SERF) and Cumulative Distribution Function (CDF) that the use of five basic routine marketing strategies can be more rewarding. These basic strategies are:
• Put (plant time)
• Twelve-segment pricing
• Three-segment pricing
• Put (pollination)(Critical Moment in production/marketing process), and
• Pricing during pollination phase.

These strategies can be adopted by farmers without an in-depth understanding of the market and market-signals. Farmers can save as much as R1.6 million per year on a 2000ha farm with an average yield.

The results obtained from the research illustrate that each strategy is different for each crop. Very important is that the hedging strategies are better than no hedging strategy at all.

This research can also be applicable to the procurement side of the supply chain.

Maize milling firms use complex procurement strategies to procure their raw materials, or sometimes no strategy at all. In this research, basic routine price hedging strategies were analysed as part of the procurement of white maize over a ten-year period ranging from 2002–2012. Part of the pricing strategies used to procure white maize over the period of ten years were a call and min/max strategy. These strategies were compared to the baseline spot market. The data was obtained from the Johannesburg Stock Exchange’s Agricultural Products Division better known as SAFEX.

The results obtained from the research prove that by using basic routine price-hedging strategies to procure white maize, it is more beneficial to do so than by procuring from the spot market (a difference of more than R100 mil).

Thus, it can be concluded that it is not always necessary to use a complex method of sourcing white maize through SAFEX, to be efficient. By implementing a basic routine price hedging strategy year on year it can be better than procuring from the spot market.

Understanding the Maize Maze by Dr Dirk Strydom and Manfred Venter (pdf) - The Dairy Mail


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