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Johannesburg - South Africa needs to end trade protectionism and draw up a new social contract with the education unions in order to start accelerating growth in tough times, accord to executive director of the Centre for Development and Enterprise, Ann Bernstein.
Speaking on Thursday at a Bureau for Economic Research seminar on the impact of the global economic crisis, Bernstein said that how South Africa approaches its trade strategy in response to the downturn will be of critical importance.
"We need to get rid of this hypocrisy - we've tried it in textiles and clothing led by the unions, but it has been a disaster," she said. She noted how, for example, officials calling for purchases of local goods did so while wearing imported suits or unionists wore imported T-shirts.
Bernstein was also very outspoken on the parlous state of education in the country and said that a new social contract with the unions in education is the key in order to start moving forward.
"The first issue is a deal and that will require citizens shouting louder and mobilising. This isn't a situation where there is a quick fix - there aren't," she said.
"We are working on what would be an effective reform strategy for schooling," she added, but could not yet divulge details as negotiations were still taking place.
But she said these issues impacted on SA's prospects for sustained growth in the future.
"A sustained commitment to open trade is needed - the alternative is we risk spiralling into trade wars that could impede growth for years to come," said Bernstein.
"We live in a different world from 18 months ago and it is not clear what the new world will look like," she added.
But she emphasised that globalisation improves competition and trade has been shown over the centuries to benefit everyone who buys and sells.
She also said that the local election campaign was about personalities but not about the hard issues of governance.
"What was striking was the absence of any real debate around the policy choices in choosing one party over the other," she said.
"We will have to now discuss these issues intensively."
Bernstein said SA is at crossroads, but should recognise that crises provide you with tremendous opportunities that should not be missed.
"We were the laggard and not the leader among developing countries in similar circumstances during the boom - for example, we missed commodity opportunities. Now we will have less tax revenue," she said.
"Protectionism is a dangerous game - South Africa is not immune from this virus. Trade really, really matters. Protectionism may be politically popular but it could cause the profound crisis to be deeper," concluded Bernstein.
- I-Net Bridge
