Sunday, March 5, 1995

FISCAL FITNESS: Progress in South Africa

Recently I paid my sixth visit to South Africa, but it was my first visit to the "New South Africa." The changes I detected are subtle but profound.

My first visit to South Africa was in 1976, just a few weeks before the Soweto riots, considered one of the significant events in the country's history. The changes I've observed over the past 19 years have been impressive and inspirational.

All my previous trips to the country left me with a somewhat bittersweet aftertaste. I was extremely impressed with the country and especially its people. But it was afflicted with a fatal flaw for which there seemed to be no cure.

The Afrikaners truly believed that sharing power with the black population would mean the end of their culture, as well as an economic disaster. Their fears were not irrational paranoia; they only had to look at the experience of almost every other African nation.

South Africa was a pariah among nations, the world's favorite whipping boy. Anyone who visited the country usually concluded that the country's bad reputation was, at best, grossly oversimplified.

Nevertheless, even large numbers of white South Africans abhorred the country's racial policies, and hundreds of thousands of them emigrated to such places as the United States, Canada, England and Australia. It's not unusual for a white South African family with four grown children to have them living in four different countries.

The progress South Africa has achieved is mind-boggling. The person who is most responsible is the new president, Nelson Mandela. It is difficult to imagine how South Africa could have peacefully accomplished what it has without him.

Mandela was unjustly imprisoned for 27 years, yet he walked out of jail without a shred of bitterness. He is highly admired and respected by both white and black South Africans. His accomplishments and stature are comparable to Washington, Lincoln or even Ghandi. To a large degree, he is a combination of those three exceptional people. The strength of his character and his obvious integrity played a major role in the Afrikaner government's willingness to voluntarily relinquish power.

Perhaps the most important international development that facilitated the peaceful revolution in South Africa was the collapse of communism. A critical aspect of the white population's fear of giving power to blacks was the concern that black government would impose communism and would be under the influence of Moscow.

The demise of communism meant that it lost virtually all its appeal to movements such as the African National Congress (ANC), Mandela's political party. Communism also was seen as much less of a threat to the white population.

A century and a half ago Karl Marx wrote his famous "A specter is haunting Europe, the specter of communism." Fortunately, those words now ring hollow.

Among the changes I observed this trip was the change in outlook I saw in the people I visited with. There is almost a tangible sense of relief as well as an invigorated sense of national pride.

The conversations I had with my friends there had a different tone this visit. It's as though a weight has been removed from their country. There is still some anxiety about what the future holds, but there is a new sense of optimism and eagerness to tackle the challenges before them. I can't help feeling a sense of excitement for them.

Will South Africa continue to move forward? Might the country fragment and deteriorate when Nelson Mandela dies? Most of his countrymen hope he has a long life, but they seem to be confident that their progress isn't dependent on one man. My assessment is that the country has vastly more economic, cultural and attitudinal assets than liabilities. That's why it's had its past success, and why it's reasonable to assume it will continue. Furthermore, their self-imposed and internationally imposed handicaps have been largely removed. For example, virtually all sanctions against the country have been rescinded.

South Africa already has, by far, the most productive economy on the African continent, especially sub-Saharan Africa. Yet it has in no way fulfilled its potential. Its tourist industry potential, for example, has barely been tapped .

The country is seen more and more as the economic gateway to sub-Saharan Africa. Its infrastructure is highly developed and other African countries look to South Africa as they seek to develop their own. South Africa's success is crucial not just to itself, but to its continental partners as well.


FISCAL FITNESS: Progress in South Africa - North Coast Journal March 1995

Ron Ross Ph.D. is a former economics professor and author of The Unbeatable Market. Ron resides in Arcata, California and is a founder of Premier Financial Group, a wealth management firm located in Eureka, California. He is a native of Tulsa, Oklahoma and can be reached at

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