The SACP has launched a blistering attack on President Cyril Ramaphosa’s proposed Growth and Inclusion (GAIN) strategy, accusing it of being a neoliberal blueprint that will deepen inequality, unemployment, and poverty in South Africa.
In a strongly worded statement released on Sunday, the SACP warned that GAIN represents a betrayal of the working class and a dangerous surrender of South Africa’s economic sovereignty to foreign interests.
The SACP’s critique comes after Ramaphosa, during the ANC National Executive Committee meeting last week Monday, described GAIN as a strategy to guide government departments’ Annual Performance Plans. However, the SACP claims it was not consulted in the formulation of GAIN. It has yet to see the strategy document.
The party’s early critique is based on a working paper titled “Growth Through Inclusion in South Africa”. It was published by the Growth Lab at Harvard University in 2023, which it believes forms the foundation of GAIN.
Neoliberal macroeconomic conservatism
The SACP wasted no time in linking GAIN to what it calls a long history of neoliberal policymaking in South Africa, dating back to the adoption of the Growth, Employment and Redistribution (GEAR) strategy in 1996. The party argues that GAIN, like its predecessors, is rooted in a “neoliberal macroeconomic conservatism”. One that prioritises private profit over the needs of the working class.
“Rather than promoting inclusion, the compradorial policymaking approach excludes and undermines homegrown research and institutional capability,” the SACP stated. The party accused the government of outsourcing policymaking to foreign actors. It described this as “academic neo-colonialism dressed as technical expertise.”
The SACP warned that adopting the GAIN strategy would mark “a new low in the surrender of national sovereignty”. And a betrayal of South African researchers, academics, and workers.
“It would signify the deliberate submission of our sovereign policy space to foreign-determined directions or individuals who have no accountability to the South African people,” the statement read.
SA’s working class battling
The SACP painted a grim picture of the economic realities facing South Africa’s working class. It says the working class has been abandoned by successive neo-liberal policies. The party highlighted the steady decline in workers’ share of GDP, which has dropped from over 55% to below 45%. While corporate profits and executive pay have soared.
“More than half the population lives in poverty,” the SACP stated. It added that unemployment has reached catastrophic levels. By the narrow definition, unemployment stands at 33.2%, affecting 8.4-million active work seekers. By the expanded definition, which includes discouraged work seekers, unemployment is a staggering 43%. It affects 12.6 million people.
The party emphasised that black African women are the most affected. They have an unemployment rate of 51.4% under the expanded definition.
“These are not the results of individual mismanagement or wrongdoing in governance only. But the predictable outcomes of a system built on racialised, gendered, and spatialised economic exploitation,” the SACP declared.
“It is capitalism at work!”
Economic stagnation
The SACP took aim at the working paper’s diagnosis of South Africa’s economic stagnation, which attributes the problem to “collapsing state capacity” and “spatial exclusion.” According to the party, these are symptoms rather than root causes.
The real issue, it argues, is the capitalist system itself. And the neo-liberal policy regime that has dominated South Africa’s economy for nearly three decades.
“The erosion of state capacity was by no means an accident. It was designed through neo-liberal policy choices that subordinated the state to dominant capitalist market forces,” the SACP stated.
The party accused the working paper of promoting privatisation and micro-economic liberalisation in key sectors. These include electricity, ports, rail, water, and telecommunications. And it’s further weakening state participation in the economy.
The SACP called for a complete break with neo-liberal orthodoxy and a radical transformation of South Africa’s political economy. It argued that the state must take the lead in rebuilding the productive economy. Also in reviving manufacturing, and expanding public works to create decent jobs.
“Fiscal policy must direct resources towards infrastructure, skills development, and strategic industries. Especially domestic manufacturing and related value chains development, diversification, and expansion,” the party stated.
It also called for agrarian transformation, including agro-processing, and investment in the digital economy.
Restrictive macroeconomic policies
The SACP criticised the working paper’s support for restrictive macroeconomic policies. These include fiscal austerity and high-interest rates, which it says have strangled investment and employment.
“The depiction of fiscal policy as a mere compensatory instrument designed to alleviate exclusion through transfers rather than transform the productive structure of the economy reveals a deep-rooted adherence to the neo-liberal model,” the statement read.
The SACP issued a stern warning to Ramaphosa and his government. It cautioned against the adoption of foreign-determined policy directions.
“True development will not come from foreign-determined policy directions. But from deepening our national democratic policy sovereignty and achieving the Freedom Charter’s economic goals,” the party stated.
The SACP said that the government must prioritise the needs of the working class and the impoverished over the interests of private capital.
“South Africa’s future lies in the hands of its people. Not foreign-determined policy directions such as neo-liberalism,” the statement declared.
The SACP concluded its critique with a call for revolutionary transformation. It proposed expansionary fiscal intervention. Also low and developmental interest rates, and the decisive mobilisation of public and social investment to build a truly inclusive and productive economy.
“The Reserve Bank’s core mandate must explicitly include broad-based industrialisation and maximum sustainable employment for South Africa to overcome the unemployment crisis and guarantee the Freedom Charter’s right of all to work in practice,” the party stated.
In its closing remarks, the SACP reiterated its commitment to fighting for the working class. And to opposing all forms of neoliberalism.
“Anything less represents the continuation of failure,” the statement warned.
