Operation Vula - Overview
Operation Vula is centred on strengthening local economies and reorienting them to become effective centres of production, information processing and spatial development. As part of this initiative we want to prolong money circulation in townships and rural areas by plucking money leakages thus forcing money to exchange more hands before it leaves the community. This will be achieved by increasing the local provision of a variety of services to local community by local enterprises. Therefore Government will support and promote local economic development and local small scale industries. Operation Vula will be realised through revitalisation of township and rural economies, Public Procurement, Radical Agrarian Socio-Economic Transformation (RASET) and Black Industrialist programmes. We have identified the following commodities for this programme: infrastructure development, agriculture produce i.e. fertilizers, bakery, furniture, and paper & toilet papers.
Conceptualising Radical Economic Transformation
In light of all the hype and unnecessary panic that accompanied the pronouncement to radical transform the economy, we have felt it important to take time and define the concept. The textbook definition of the term “radical” is derived from the Latin word, radix, meaning “roots” - change that goes to the heart of the problem. Let us state upfront it is not the intention of government to flout the constitution and laws of this country. It is also not the intention of government to overhaul those laws and systems that work effectively and replace them with populist rhetoric.
We are leaving in an era where people across the globe are despondent about establishments that are not bearing tangible benefits for them. People are no longer satisfied with flowery speeches, grandiose plans, economic theories and endless promises of a better life. They want to see their lives changing for the better. Unfortunately, this wave of anger is also becoming a breeding ground for demagogues who are exploiting the legitimate concerns of the people for their end.
South Africa is also seating on the ticking time bomb. The number of people who are still trapped in poverty is alarming; the unemployment rate remains stubbornly high and the high levels of inequalities are expanding. What is most devastating is that the youth bore a major brunt of this unemployment. All classical economic theories (capitalism, neo-liberalism, socialism and communism) concur that this is a recipe for disaster.
We can no longer be tinkering on the edges and be comfortable with small changes that have a negligible effect on our drive to reduce unemployment, poverty and inequalities. Despite all the major strides we have made to economically liberate our people, a large majority of them remain stuck in poverty. We are convinced that the failure to reflect the country’s racial and gender demographics in the structure and ownership pattern of our economy, is the core reason why poverty, inequality and unemployment persist.
In our assessment, radical economic transformation entails a robust shift to an economy that will benefit all including the marginalised groups of the society such as youth, women, people with disabilities and the poor. We are absolutely rejecting an orthodox view that posits that economic benefits will eventually trickle down to the poor if we grow the economy substantially. Similarly, we are departing from the classical theory that view the role of government in the economy as that of ensuring the free working of markets, sometimes referred to as the enabler role. We firmly believe that government should, in addition to enabling the efficient operation of the markets, be the catalyst for transformation through strategic interventions in the economy. As a developmental state we should not be apologetic to intervene in the economy in a responsible manner for the benefit of all including the marginalized.
In a nutshell, this intervention radical economic transformation for us dictates that we must overhaul any system and program that perpetuates inequalities, unemployment and poverty. We want an economy that will benefit all its citizens irrespective of their class, race, gender and spatial location. Transformation should be characterized by meaningful participation of everyone in the economy. We are clear that those historically disadvantaged should be at the epicentre of development as it is shared and inclusive economic growth that we want to see.