Correction Mike Schussler, SA is not as bad as you think!

Source: sagoodnews.co.za, 24/11/2015

Mike Schüssler recently wrote on MoneyWeb, 11 November 2015 "Welcome
to the decline - South Africa – It is much easier to become poorer
that richer".


I made a few corrections (see below)
"So much style without substance
So much stuff without style
It`s hard to recognise the real thing
It comes along once in a while
Like a rare and precious metal beneath a ton of rock
It takes some time and trouble to separate from the stock
You sometimes have to listen to a lot of useless talk" – Neil Peart in
Grand Designs.


It is not only South Africa`s sport that is on a slippery downward
slope in world rankings; the Springboks lost to Japan in the World
Cup, Bafana is 75th in the world and our netball has slipped to fifth
in the world.


Similarly, our economic rankings are also heading in the wrong
direction, from the ease of doing business to our position on the
World Economic Forum`s competitiveness rankings.


Actually, in this year`s WEF Global Competitiveness Report our ranking
improved 7 (seven) positions. In respect of ease of doing business we
are ranked 38/140 countries, down from 34/133 countries in 2009.



Even our highly-rated universities are slipping on international
quality rankings. In fact, over the last two decades, we have fallen
from the top 30th positions on international rankings to between 40th
and 50th, and in other instances… even lower. Gone are the days when
South Africa was in the top quarter or even the top third. Those days
are now the heydays.


Actually, in the QS report ranking 20 000 universities globally, SA
has 9 ranked in the top 4% (ie in the top 800) up from 6 in the top 4%
a few years back. True UCT, our top ranked university, has fallen
somewhat from 141 to 171st, but a number of others have improved (see
below).


QS World University Rankings 2015/16 - South Africa
2015 2014 Institution Name
171 141= UNIVERSITY OF CAPE TOWN
302 390= STELLENBOSCH UNIVERSITY
331= 318= UNIVERSITY OF THE WITWATERSRAND
501-550 471-480 UNIVERSITY OF PRETORIA
501-550 601-650 RHODES UNIVERSITY
551-600 501-550 UNIVERSITY OF KWAZULU-NATAL
601-650 601-650 UNIVERSITY OF JOHANNESBURG
701+ NORTH-WEST UNIVERSITY
701+ UNIVERSITY OF THE WESTERN CAPE
© QS Quacquarelli Symonds 2004-2015www.TopUniversities.com All rights
reserved.

But the real number that should get the attention is that which shows
how South Africa is getting poorer. Not in absolute terms, but
relatively speaking. In 1990 the average per capita income was ranked
50th in the world, but this has slipped to 77th in 2013.


Last year was a disaster and SA dropped nine places to 86th place.


Today the average Chinese citizen and the average person
from Azerbaijan; Turkmenistan; Belarus and Bulgaria are all richer
than the average South African.


This is correct, in a survey of 185 countries, we are one place behind
China, and a few places below the above. Is this not largely because
of the devaluation of the Rand, as all the figures are measured in
US$?


In fact, South Africans are now in the bottom half of the world in
terms of income. On a per capita basis, the average South African
earns only 63% of the average world citizen.


I`m not sure being placed 86th out of 230 countries in the world means
that we are in the bottom half?


New data from the World Bank shows Chinese income overtaking our
income, both in purchase power parity and market income terms. It is
also evident that if South Africa cannot improve efficiency levels and
commodity prices continue to fall, we may find ourselves on the wrong
side of the 100th position in 2020.


In 1994 South Africa was the 25th biggest economy in the world. By
2014 we had slipped to the 33rd position and there is a good
possibility that we will soon be surpassed by Denmark; Malaysia; and
Singapore. If our current weak growth performance and the slide in the
exchange rate of the rand worsens, it is also very likely that South
Africa will no longer be in the top 40.


The Economist (2015) ranks us as 25th on the basis of purchasing power
parity and 29th in respect of GDP.


Falling out of the top 40 largest economies is serious as many big
companies only look at the top few markets to invest and sell
in.


Generally these declines are not sudden, but this does not go
unnoticed. South Africa`s attractiveness as an investment destination
will slowly start to disappear while we also lose our relevance on the
political radar.


Agreed, FDI has levelled off due to government policy
indecision.


This makes it all the more difficult to turn around the downward
trajectory of economic growth. It not only becomes more difficult to
retain sport talent, but also to retain our top scientists and
entrepreneurs. Academics also look for greener pastures, and our top
students follow suit.


According to the Global Competitiveness Report our capacity to
`attract talent" has improved, we are currently placed 41/140
Foreign investment then dries up. South Africa will become much less
of an investment priority and when the Department of Health bullies
another pharmaceutical company who wants to do business, they are
likely to go elsewhere.


They will run even further in the opposite direction when our
politicians and protesters continue to praise countries and rulers who
have economically enslaved their people.


The reality is that South Africa`s economic cupboard of ideas is
empty. One top firm after another is chasing opportunity elsewhere.


Our top 60 companies now earn 70% of their turnover outside
of SA borders. In effect, they have left and South Africa is just
another market.


BMW doesn`t think so.


By most standards South Africa is not sitting at the main table
anymore. We are actually fighting for the crumbs.


Remember it took 15 years of growth at 11% plus for Ethiopia to rise
from the poorest country in the world to become only the eighth
poorest. Zimbabwe fell 20 places in the same time.


It is so much easier to become poorer than richer.


But spare a thought for Zimbabwe, which could be seen as a benchmark
South Africa needs to stay away from.


At independence Zimabawe was in the 67th position and firmly in the
top half of the international rankings. The country is currently in
the bottom 22 and is the worst performing country in the history of
the modern world.


Why then do we constantly compare ourselves with Zimbabwe when we are
in the Premier League of Nations at 49/140, and Zimbabwe is at
125/140?


Today the average Zimbabwean dies earlier and is hungrier than in
1980!


It is indeed much easier to get poor than to get rich.


The tables below indicates where we do best and worst in this year`s
Global Competitiveness Report




Conclusion.
These discussions are difficult, we all know the `lies, damn lies, and
statistics` quote, and probably the `everyone is entitled to their own
opinion but not to their own facts` quote.
I think it is a question of balance, responsibly focussing on the good
with the bad.
As Max du Preez reminds:
"We heard a lot of grumbling from middle-class black intellectuals and
professionals about white supremacy, inequality and so-called
decolonisation recently. And yet the establishment of a significant
black middle and upper middle class over the past two decades has been
spectacular and unprecedented.
• The number of black people earning more than R400 000 per year grew
by 1 000% from 120 000 in 2000 to 1.2 million in 2014. Nine out of ten
of them are in the private sector.
• The black middle class grew 300% from 1.8 million to 6 million
during the last decade.
• In the five years between 1996 and 2011, black disposable income
grew 370% from R161 million to R756 million – significantly higher
than total white disposable income.
• Today, more black homeowners are paying off bonds on their
properties than whites. Twenty-one years ago black people could not
own property.
• Nine out of ten black households have at least one cellphone.
• Private schools are 72% black.
• Since 1996, black people living on less than $2 a day has fallen
from 16% of the population to 2,5%.
We have extraordinary energy, vitality and goodwill in SA.
• We have civil society organisations like Equal Education, Freedom
Under Law, Right2Know and Abahlali baseMjondolo.
• We have a vibrant and innovative business sector and leadership,
such as in the farmers` community (agriculture will lead land reform).
• In the charity and welfare sector we have churches, NGOs, the
Rotarians, Lions clubs, women`s organisations, Gift of the Givers and
many more.
Our energy problems are almost over – it`s been nearly three months
since the last load-shedding.
How do we drastically reduce inequality? Through wealth taxes, faster
land reform and redistribution, says economist Thomas Piketty. Listen
to him – but I would argue that his ideas go hand-in-hand with the
imperatives that we have more efficient government, better education,
more funding for students, less corruption, more cohesive policies,
and fewer grand schemes.
Imagine a post-Zuma South Africa, a changed political environment of
perhaps coalitions ruling in provinces and local councils, clear
economic policies and a more efficient and accountable civil service.
I can realistically imagine an SA in the not-too-distant future with a
6% growth rate, an exchange rate of R10 to the US dollar, declining
unemployment, a transformed education system and a new optimism
replacing anger, intolerance and depression.
I can imagine a time soon when we South Africans can hold our heads
high again in the world as we did immediately after 1994.
That`s the SA we should work hard for. I want to be part of that SA
and the battle to get there.