The state must wrestle back control of the economy. Over the years the South African government gave up its leading position of controlling and directing this growth.
The results of losing control of strategic levers of the economy are now clearly visible for all to see. We are in an almost collapsed economy. Sectors of the economy and major industries and companies are closing down daily.
Companies and industries are migrating to more economically favourable destinations internationally. Around the world it is the state that leads the economy in all policy fronts.
The pace and rate of economic growth is tied to direct state interventions, which are carried out by the state to lead the economy in all fronts.
So it is foolish to think that the private sector on its own will lead and revive the economy as it is today, without the state taking a leading position in driving economic development and rapid economic transformation policies.
The role of the private sector is not developmental. The private sector responds to policy directives championed by the state in propelling socio-economic development and economic growth in the economy.
What is the role of electricity in the economy? Many people over the years always thought that electricity was a mere utility used daily without ever thinking deeper into the role that electricity plays in driving socio-economic development, and rapid economic transformation and growth of the economy, and society as whole.
Many leaders in power today were never properly trained in matters of overall governance of a state, the sciences of how to run a state, the economy, its financial, technical and technological systems in the state. We are in a quagmire of a lacklustre economy due to this.
The failure of Eskom, the electricity and energy sector is the tip of the iceberg. The deeper you dig, the more visible the signs of the fact that the state neglected its role of leading the economy. A capable state easily navigates these challenges like a hot knife through butter.
Having studied extensively for many years in the energy sector and electricity sciences, it has became clear that South Africa’s problems did not start with Eskom failing to provide electricity.
Load shedding and the energy crisis started the day the state turned its back against all warnings, of a pending energy and economic crisis a result of insufficient energy generated to supply the grid.
At the time those in power did not heed the stark warnings and even went so far as to mothball some plants due to energy oversupply at the time.
Almost all post democratic South African Presidents have overlooked this very important role of planning for sufficient future electricity and energy generation for the economy, let alone current. This was a critical role that the state was entrusted with as a responsibility by the voters.
The voters always gave a clear mandate to those in power. Get the economy right, fix, build on the successes and develop a future proof economy that will be resilient to any turbulence and crisis locally and globally.
The absolute failure of military-like planning resulted in the current economic collapse.
Of course we can argue that the economy has not collapsed. But the reality is that the South African economy is in poor health and needs to be revived rapidly, like as of yesterday!
This requires a political leadership that will take bold decisions to directly intervene and drive the economy to health, not keep it on life support.
One can see the repercussions of the lack of energy and policy with South Africa facing total collapse of the steel industry, as Arcelormittal South Africa is currently in talks to avert the planned closure of its long steel operations . Administrative officials and parliamentary policymakers should be scrambling and scouting talent needed to revitalize the economy and plan for its success.
In the near future, at this rate of failure in all sectors of the economy we will soon be importing our basic dinner table salad because we have allowed strategic economic sectors to collapse and die off. South Africa over the past 30 years has lost more than a 100 smelters and countless foundries and refineries.
Everyone who has been to Dubai always comes back bewildered with what the tiny Arab Emirates achieved over the 30 years. But they fail to realise that the meticulously built city was first an idea.
Today that idea has been translated into a plan, and executed with military-like pace by the Ruler of Dubai City Sheikh Maktoum, at the height of his leadership in driving the Dubai modernization plan.
So to our leaders who frequently visit these countries. Feel a sense of shame and come back after the visit rejuvenated, and plough back what you may have learned on that taxpayers’ subsidized overseas trip to Europe, Asia, the US or the Middle East.
The World Economic Forum (WEF) says on energy:
Electrifying to unlock economic potential:
It said, “Building new, high-efficiency power plants and modernizing ageing plants are two of the main drivers for providing a cleaner, more reliable power supply. Advanced technology of the kind used in today’s gas turbines can not only drastically reduce fuel consumption and CO2 emissions, it also provides the necessary flexibility to compensate for fluctuating renewable energy sources.”
The WEF’s emphasis on economic planning in the energy generation sector was what should be placed on building high efficiency new power plants, and modernising ageing power plants and extending their life of plant.
And indeed, reflecting on the WEF’s energy statement, technology is highly modernised and so are the opportunities to leapfrog in terms of development.
A country like South Africa can overnight undergo rapid economic transformation and development by just focusing on doubling the capacity of baseload and renewable energy generation.
It is not a question of one against the other. Or the ending of coal while aggressively building renewable alternative energy sources without requisite backup which at this stage can only be provided by baseload energy.
South Africa needs leaders who will build this country’s economy. And to build an economy, electricity is the catalyst for growth and rapid economic transformation. It all starts with a dream that translates into a plan. As the saying goes. If you fail to plan you are planning to fail.
Crown Prince Adil Nchabeleng is president of Transform RSA and an independent energy expert.
* The views in this column are independent of Business Report and Independent Media.
BUSINESS REPORT