South Africa as a Developmental State

M. KlausenPOLI123October, 2014


South Africa as a Developmental State

Introduction
There has been much debate on whether or not South Africa can classify itself as what is now popularly known as a "developmental state." In short, such a state refers to a condition where the state plays a key role in the economic growth, but still within the context of a market economy (Laubscher, 2007). Put into other words, there must still be the competition and rapid growth of the free market as with capitalism but with the strong, guiding hand from the state in order to reach the developmental goals. The ongoing debate has been if South Africa is working towards becoming a developmental state, if it is even possible, and whether or not it is beneficial. In finding these answers, we need to identify characteristics of the developmental state, therefore searching back in history to where it first originated.

The concept of the Developmental State
The term "developmental state" origins back to the model used by the East Asian countries, firstly Japan and more recently China, to rise back from their economic crises. There is no clear definition of the concept; it first came to be after the rapid economic growth of Japan and the search for an explanation of this boom. This section will therefore not provide any clear –cut definition of the concept, but rather focus on delivering characteristics of the developmental state where it first originated and later apply these characteristics in South Africa's current state.

The developmental state in East Asian countries

Chalmers Johnson (1982) structured the basic framework for the East Asian developmental state as a state where one sets specific developmental goals, and then mobilises society to achieve these goals. As one can see from this, there exist two elements of the concept: one structural and one ideological (Mkandawire, 1998). This is what separates it from other forms of states; the developmental state must both underline its principles of development, and structure itself in this way.

Another characteristic of this state is the autonomy it enjoys from social forces, which might enable it to implement long-term economic policies without having to be sidetracked by private interests (Leftwich, 1995:400-427). This is where the relevance of policy-making in the developmental state comes in; in order to intentionally structure itself to achieve its goals, the state must compose policies to achieve this. This is one of the many lessons learned from the success of the four "tiger countries" in Asia, the implementation of the right policies. Kwan S Kim (1991:54) states that the lesson from South Korea's success was "pragmatism and flexibility of its policies as well as effectiveness in implementation."

Furthermore, with this autonomy of the state it also implies that the state must be an interventionist, meaning the degree to which the state intervenes in the society which is part of its sphere of influence (Venter, 2011:84). If the state is to drive the development and industrialisation without intervention from social forces, it must intervene in these social forces itself. Thus, a developmental state must be equal to what Venter (2011:179) refers to as a "strong" state; one that is led by a purposeful and determines developmental elite who establish its legitimacy through its ability to achieve sustained economic growth.

2.2. The developmental state outside of East Asia

Many European countries post-19945 enjoyed economic growth. There exist different welfare states in the world, and some of the European countries with a strong economy are not necessarily the same as the East Asian model. The Scandinavian countries are for example also welfare countries, but rely on the Nordic model compared to the East Asian model. One can argue that the different models are based on the same principles of economic growth, state interventions and autonomy of the state. The main difference is however that the East Asian developmental state has a focus on the economic aspects, where the Nordic model focuses on the social ones. The models that have been identified are merely theoretical, there is no prototype of how a state following this model must look, and each country must formulate policies that work best under their circumstances. There has nonetheless been diverse research and studies on how to identify the structures of such a state.

It is suggested that some countries after the Second World War also followed the same structures with success as the countries in East Asia; Germany is commonly mentioned and its role as protective government, and Finland was also able to rapidly mobilise a big amount of resources, mainly reflected in a high rate of capital from manufacturing industries. There was a basic commitment to upholding the market economy, like the principle of the model prescribes. In its characteristics of non-socialist economic planning differs it from the other Nordic countries and warrants a comparison of the Finnish growth regime with those of the Asian countries (Jäntti, 2009:3). From this perspective, we can see how the two models differ from each other.

This discussion leads us to the question on whether or not South Africa is or will ever be what the developmental state is classified as. The following sections will use the discussed characteristics of the developmental state as a foundation, and further compare these to the current state of South Africa. As previously mentioned, policy-making is an important attribute and the different policies that have occurred will therefore be a main focus of the discussion.

South Africa as a developmental state
While the East Asian countries felt as if it was "essential to develop if they were to survive as nations" (Gumede, 2009:6), the newly independent African countries did not feel the same urgency even though they also pursued development. Many approaches were debated, leaders wondered on whether or not they should simply return to the communal form of development, ideologies like communism and capitalism were considered. Instead of being pragmatic and borrowing necessary elements from both or more ideologies, like the East Asian model which used both a free market and a strong state.

The government of South Africa committed itself to build a developmental state when the African National Congress endorsed this proposal in June, 2007 at their policy conference (Chagunda, 2007). The proposal was highly supported at the conference, but many scholars have debated if there is a clear consensus on how to address the problems they wish to solve. Seeing this in the light of the current South African government, there may be a consensus on which problems must be dealt with; poverty, HIV, unemployment, but when it comes to how they can achieve this, different approaches may emerge. The following will be a discussion on current policy formulation in South Africa and the importance of policy-making in a developmental country.
3.1 Policy making in South Africa

A public policy is explained to be referring to "all formal and publicly known decisions of governments that come about through predetermined channels in a particular administration." (Venter, 2011:167). To understand how a country may be seen as a developmental country, it is necessary to understand the importance of policy formulation. As a policy is constructed to be focusing on "what is actually done instead of what is only proposed or intended" (Anderson, 1997), it is clearly the most accurate document the public has on the government's action of plan. The policies in developing countries are not only important because of the formulation itself, but especially the process to formulate the policy will need attention. Venter (2011:169-170) presents two different models of approaching the policy making; a rational approach and a garbage-can approach. Explained briefly, the rational approach takes for granted that people are rational beings, following a linear process in the decision-making. It is during the stage of identifying alternative policies that policy instruments should be determined. Policy instruments refers to actions to be taken to implement a policy, it is therefore the actual actions to be taken in order to achieve the result of the policy. There exist basic steps in the process, formulated by Morse and Struyk (2006:12);
Verify, define and establish the problem
Establish evaluation criteria
Identify alternative policies
Evaluate and compare alternative policies
Select the best policy among the alternatives considered
Monitor and evaluate the proposed policy
As one can see, the rational approach to policy making demands specific steps in the process in order to select the best possible policy. Even though this is seen as the model most appropriate for a strong, determined developmental state and it is undoubtedly the most ideal approach, it might not always apply. The garbage-can approach acknowledges that people are not always rational beings, and certain steps might not be taken or be simply avoided. Cohen et al. (1972) compares it to the functioning of garbage-can where various things are thrown in and taken out again, often by many and various people. There is no linear process in this model, and no specific steps that are followed before the policy is formulated. The authors of the model provide us however with three interrelating premises;
Problems, which are of concern to both people inside the organisation as well as outside. It may occur out of family, lifestyle, frustrations, group-relations, money, ideology and media. All off these need attention.
Solutions, which is described as an answer actively looking for a question. Despite the saying that answers cannot be found until the question is formulated well, people are not even aware that there was a problem until the solution is found.
Participants, which are fluid as the effort and time devoted by each participant will differ.
Choice opportunities, which is the behaviour of an organisation when the decision must be made. Opportunities occur regularly, and any organisation has its own way of declaring a decision.
One can see this as organised anarchy, and it makes the boundaries of the organisation uncertain and changing – Cohen et al. (1972) suggests that organised anarchy can be found in all organisations' activities, but not necessarily all of them. While following the rational model is highly time consuming, the garbage-can model eliminates on the other hand the time-problem but also the rational way of dealing with a policy-matter that is required of a developmental state. As previously outlined as a requirement for the developmental state, by putting the state in the centre of the transformation process, it demands a highly effective public service. This theory leads us to the discussion on what steps has been taken in South Africa to optimise this function, and work towards a better functioning bureaucracy to serve the public and also be leading the transformation process into the one of a developmental state.



3.2 New Public Management

The latest year, within the public sector, there has been a progression from the traditional administration models to what is called "new public management." Actually, since the 1980's it has gotten worldwide attention, and businesses in many countries has embraced it. This new approach manages public services in a manner that applies for the principles of the management traditionally associated with the private sector or market economy (Venter, 2011:167). New public management is in other words focused on decentralization in the management, meaning that the service performed and the decisions taken by the public sector must be as close as possible to the people affected by it. Various forms of decentralisation of the management has been mentioned; increase the use of private sector markets to increase the competition, increase the emphasis on performance, outputs and customer orientation (Larbi, 1999:13).

Since this shift into new public management, there has been research on whether or not the public sector of South Africa has experienced any of these effects. Research has found that the promised decentralization has not taken place as expected, even though the framework for it has taken place (Cameron, 2009). The same studies found mixed results of the Senior Management Service (SMS), which was created to promote the efficiency of the state. While there existed some good managers in the public service, it was concern about the quality in others. One can therefore conclude that even though the thoughts behind the new management approach may be optimistic, it takes more than only the framework of it before any actual changes can take place.

3.3 The National Development Plan

The African National Congress adopted in 2013 the National Development Plan as its Launchpad for future socio-economic policies. The full text of the plan (National Planning Commission, 2011) consists of 444 pages; therefore this section will only present a brief summary of the main points of the National Development Plan.

The strategic perspective of the plan offers a long-term vision (until 2030) that "aims to ensure that all South Africans attain a decent standard of living through the elimination of poverty and the reduction of inequality" (Zarenda, 2013:5). A vision is important for many reasons, not only because it offers legitimacy to the public, but also because it gives the stakeholders something that guides them. Referring back to the volume of the plan and the time perspective of it, one can easily loose the main goal in the jungle of suggested implementations.

Very few developing countries have progressed in terms of the economic development without a long-term development plan to serve them in the future (Gumede, 2009:7). It provides the state with a prioritized plan, and there has been argued that if no pillar priorities have been defined in a long-term development plan it may be easy for the government to become blinded with short-term issues (Garcia, 2005:18). In this light, we can acknowledge that a development plan must focus on the long-term issues of the state, but it will also need to generate public and stakeholder legitimacy (Gumede, 2009:7) in order to be accepted. This absence of legitimacy in the vision is a specific reason for the failure of the development plan of Latin-American countries. There is a broad agreement that even though Latin-America was in economic difficulties, both East Asian and Latin American countries borrowed heavily in the 1970. Therefore, reasons for the success of the first and the failure of the latter must lie within the structures of the nation itself. Now we can understand the importance of the National Development Plan, as it is the core plan of the nation's development and it needs to legitimise itself in order to be implemented and succeed.

Looking back at the vision of the South African NDP, it aims at ensuring that all South Africans attend a decent standard of living. This calls for a discussion of what is considered a decent standard of living, which the core elements of it are provided for us in the plan (Zarenda, 2013:5);
Housing, water, electricity and sanitation
Safe and reliable public transport
Quality education and skills development
Safety and security
Quality health care
Social protection
Employment
Recreation and leisure
Clean environment
Adequate nutrition
It is set out that after 2013 a series of five-year cycles will be activated, namely from 2013-2019, 2019-2024 and 2024-2029) with continuous review regarding the failure of success of respected cycles to meet the stated objectives of the goals set out by the National Development Plan (Zarenda, 2013:6). In order to reach these goals, South Africa must "draw on the energy from its people, grow an inclusive economy, build capabilities, enhance the capacity of the state and promote leadership and partnership throughout society." This formulation shows how the NDP draws on lessons from the East Asian countries; by enhancing the state's capacity it is purposely strengthen its position, as well as promoting leadership and partnership.
The New Growth Path (2010) aims to create 5 million additional jobs by 2020, thereby putting much weight on their core element of employment in the plan. The reason in simple; South Africa has millions of able people who wants to work. In able to meet the needs of these people, labour must be generated and thereby generating a larger amount money within the country. This is compatible with the perspective of the East Asian developmental state, which is according to Leftwich (1995:61) "driven by an urgent need to promote economic growth and to industrialise in order to catch up with the West or industrialised neighbours."
Conclusion
The above discussion reveals that there are elements of a developmental state in South Africa, but perhaps not in the full meaning of the concept. Attempts have been made with regards to reforming the public management, but one can perhaps say that they are still only attempts. Even though the full implementations are not yet mature, according to Laubscher (2007) we can still find elements of success in such as the National Development Plan and "the pressure on the financial sector to extend financial services to low-income groups."
The same author points out that certain elements of the main structure required are absent, such as a strong elite, a meritocratic bureaucracy to attract the best talents in the country. While an important aspect of the developmental state is a strong state and bureaucracy with a consensus on a collective project in all sectors of society. In addition, the government's necessary intervention in the free market is still more through regulations than through direct participation. For the state to be in the centre and be able to shape the market in its advantage, it is indeed necessary to move away from the rigid regulatory role of the bureaucracy to increase competition and development. Without the presence of a leadership with a strong and common goal pulling them all in the same direction, elements of the structure found in the model of the East Asian countries are lost.
Dumon, A. (2012) argues that the biggest structural and institutional issues in South Africa relate to the inefficiency of the government bureaucracy, as well as the constant health issue putting weight on employment creation as an important driver of the country's wealth. As pointed out by Laubscher (2007), South Africa is not merely focusing on economic growth as much as still attempting to redistribute the resources equally and "striving to achieve its objectives of social equality be regulating the activities of the business sector rather than actively participating."
Seeing all of this in perspective, one can say that South Africa is still lacking what it takes to structure itself as a developmental state in the original East Asian sense. It still exist broad problems within the country of both social and economic concern that might need attention before the vision of transforming into a developmental state is fulfilled. It can be seen as a developmental state to-be or in the process.








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