Economists have an unfortunate habit of making economic growth sound complicated. It isn’t. The blueprint has been written.
Over the past three decades, countries across Asia, Eastern Europe and South America have demonstrated a remarkably consistent formula for creating prosperity. They unlocked their economies, encouraged investment, built infrastructure, embraced manufacturing, expanded exports and created an environment where businesses could thrive. Millions of their citizens escaped poverty.
The world is no longer asking whether the economic model works. The only question is why South Africa hesitates to embrace it.
Take Vietnam. A generation ago it was one of Asia’s poorest nations. Today it is one of the world’s fastest-growing manufacturing economies. By welcoming investment, improving infrastructure and integrating into global supply chains, Vietnam has become a production hub for electronics, clothing and technology.
India followed a similar path. Economic liberalisation, investment in infrastructure, support for entrepreneurship and a relentless focus on expanding private enterprise transformed India into one of the world’s fastest-growing major economies.
Poland proved that structural reform works. By embracing market principles, attracting investment and modernising infrastructure, it transformed itself into one of Europe’s most successful emerging economies. Productivity increased, exports surged and unemployment
fell dramatically.
Different countries. Different histories. Different political systems. Yet the same economic principle prevails.
Governments create prosperity by creating the conditions in which others can.
South Africa is not short of opportunity. We have sophisticated financial markets, world-class banks, deep pension fund savings, advanced agriculture, extraordinary mineral wealth, engineering expertise and established manufacturing capability. We also hold a strategic position as a gateway into Africa. Many countries would envy these advantages.
As I wrote in my previous column after President Cyril Ramaphosa’s address to the 9th Southern African Customs Union Summit, the president was right to emphasise attracting private investment, improving competitiveness and creating conditions for economic growth. But speeches do not grow economies; execution does. Private investment arrives because governments earn it.
Investors look for reliable electricity. Efficient ports. Modern freight rail. Safe, well-managed cities and policy certainty.
South Africa continues to fall short on too many of these fundamentals.
As I have argued previously, the governance and financial crisis in Johannesburg is more than a municipal embarrassment. It is a warning to the country. When Africa’s economic powerhouse struggles with deteriorating infrastructure, unreliable service delivery and weak financial management, investor confidence inevitably suffers.
Every failing municipality and unnecessary regulatory delay quietly increases the cost of doing business and reduces competitiveness. This is not simply about fixing government; it is about unlocking economic growth and creating jobs. This is an election year, surely there can be no greater national priority?
Let us become the easiest country in Africa in which to invest. Le us rebuild our manufacturing base, modernise our infrastructure, partner confidently with the private sector, reward entrepreneurship and compete with the world’s best.
Most importantly, let us unlock an economy in which every South African has the opportunity to participate, to innovate, to invest and to prosper.
- Van Doesburgh is head of economics at CPUT and a business consultant on SA’s economic landscape, focusing on financial markets, policy and business strategy.
vandoesburghm@cput.ac.za
- Economic growth follows a proven formula: unlocking economies, encouraging investment, building infrastructure, embracing manufacturing, and expanding exports, as seen in countries like Vietnam, India, and Poland.
- South Africa possesses significant advantages, including sophisticated financial markets, mineral wealth, advanced agriculture, manufacturing capability, and a strategic position as Africa’s gateway.
- Despite these strengths, South Africa falters in providing reliable infrastructure, efficient services, and policy certainty, which undermines investor confidence and economic competitiveness.
- Governance challenges, such as the crisis in Johannesburg, highlight systemic issues that increase business costs and hinder job creation and growth.
- To unlock prosperity, South Africa must prioritize execution by improving infrastructure, partnering with the private sector, fostering entrepreneurship, and making the country the easiest place in Africa to invest.
