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This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. It is the product of almost two decades of research and includes analyses, chronologies, historical documents, and interviews from the apartheid and post-apartheid eras.

06 Dec 1999: Nzimande, Blade

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POM     If I may take you back to, I've had time to read the statement that was issued yesterday after the meeting of the Central Committee and then I heard you being interviewed on SABC last night. One of the, maybe I was mishearing you, but one of the things you were saying was that in the Alliance Summit that the alliance must review, the time had come to review the nature of the alliance partnership, that even though GEAR isn't mentioned in the press statement at all that the SACP was still not satisfied with the government's rigid adherence to GEAR's micro-economic policy and that some matters had to be thrashed out with regard to the approach to alleviating poverty and what the SACP ultimately had in mind was a socialist state which I would assume is somewhat different from what the current government has in mind. I don't know what they have in mind but I am assuming it is, at least given policies they are pursuing. Could you just comment on that broad range of statements encapsulated in the question?

BN     Basically what we were saying yesterday, what the Central Committee basically was saying, is that we do not think that it is in the interests of the country per se that the governing alliance has not agreed on such a fundamental issue as macro-economic policy and the message of the SACP which was in relation to the forthcoming alliance is that we really need to find common ground on this issue. Of course as we said we still do not agree on the macro-economic policy that government is pursuing and for that reason we believe that we have to find common ground. We are particularly concerned also about the fact that we seem now to be pursuing almost a zero percent budget deficit because we have met the target we had set of 3% but it looks like now we are just continuing saying well we're aiming even for a surplus.

POM     There's kind of an obsession with –

BN     We have a problem with that. That is why we think that this issue actually needs to come back quite forcefully into the alliance discussions. Of course we were saying as far as we are concerned we are not saying that government must just handle public moneys recklessly. No-one disagrees with fiscal discipline but fiscal discipline is not equal to punitive budget deficit targets because for us fiscal discipline has got more to do that you don't spend money recklessly, one, and secondly we must make sure that every cent that the government spends actually has the required, the desired effect in terms of tackling poverty and so on. Our starting point of course is that we don't believe that – you know the major problems that we are facing in this country at the end of it all they have got to do with capitalism and we noted as the SACP Central Committee over the weekend that there seems to be a deepening, capitalist character of South African society, although we are still debating that question as to what are the indicators for that and so on but it was an issue that was put on the table. That for us as the Communist Party is really the thing that we need to tackle, that all maybe what we have been saying coheres around tackling poverty as the biggest problem that faces our country and also as the biggest problem that actually threatens even democracy itself and that all else we are trying to do really has got to do with about eradication of poverty. We are acutely aware that you can never really eradicate poverty under a capitalist system which means that for our struggle to relate for the eradication of poverty is also related very fundamentally to a continued critique of capitalism, continued challenge of elements of capitalism in the immediate period, in the current period.

     As we said at our 10th Congress Party Programme, rolling back the capitalist market particularly in areas of basic social delivery and social services, that we need to defend and extend the public sector because we believe that the public sector is quite capable, maybe not as it stands now, but it is quite capable of really addressing some of the needs of the people of our country and also to lead that process of economic development rather than to leave everything to the market and then you have the state merely playing the role of regulating instead of also the state playing the leading role in disciplining capital, trying to provide incentives and disincentives for capital to invest in areas which are going to have maximum social returns like job creation.

POM     Job creation, to take one, has been talked about now since I have come here, well let's say since 1994 when the new government took over. It's been job creation, job summits, job this, job that and yet the reality is that more and more jobs are being lost every year than are being created and the problem of the unemployed is a growing problem rather than a diminishing problem. So it's like you have two separate societies, the employed and the unemployed. Yet the government talks about it all the time but one can't see any results to all the initiatives they have taken.

BN     Well yes, I don't think actually that's going to be easy. That's precisely why we've prioritised this question because we know that it actually requires an effort for all of us to pull together. One of the problems we face in this country in the first instance is the legacy of apartheid, that we had two societies but the unemployed happen to be predominantly black, unskilled women. That is why the issue has actually become a priority for the ANC. It would become a priority for any government really. That is why also in the SA Communist Party we are saying priority number one in tackling poverty is actually job creation and not just job creation but also job retention. One of the problems we are facing is these high levels of retrenchments and so on.

     The aim of the Presidential Job Summit really was, like many, to strike some kind of an accord around job creation which seems to have taken us some way in terms of identifying the nature of the problem and what needs to be done. But the parties to that Job Summit are not pulling the same way. We think that business really is on an investment strike in this country.

POM     Is?

BN     On an investment strike.

POM     On an investment strike? That it's not investing?

BN     Low level of investment by business in SA.

POM     So they're investing abroad?

BN     Some are investing abroad, others I think they are speculating possibly with their money because percentage calculations are that we are only investing – is it 19% of the GDP? And that's very low, particularly compared to countries that are in the same category as SA and that's causing problems. The Presidential Job Summit was trying to take business out of that mould to actually say job creation is a national duty, all parties should actually work towards that. Instead what business is interested in is making more and more profits and wanting the workers to be the ones who actually pay the price for turning this country around.

POM     They would argue that if you compete in a global economy, which SA has no choice but to compete in a global economy, then you must be lean and efficient and that it is the worldwide trend that labour is increasingly being disposed of for capital and for new technologies.

BN     You know we have a problem with that as the SACP in many ways actually because as the Reconstruction & Development Programme stated the basis on which we must be economically competitive internationally must be based on devising strategies to stimulate demand-based on meeting the needs of the population of SA. Now you can be as internationally competitive as anything but it's not actually going to have an effect in terms of unemployment, in terms of reducing inequalities here and you end up shooting yourself in the foot because you're actually just creating more and more conditions for instability in a country like SA. We think that almost a pre-condition for international competitiveness is actually domestic competitiveness if you like, in itself it should stimulate demand here, you find ways and means of providing cheaper - accessing goods for your local population which is poor. And that becomes a basis for international economic competitiveness because what's the point of saying we are being internationally competitive but you are actually destroying the conditions even for capital accumulation for that matter, even if one were to look at this from the standpoint of the capitalists. You need a balance between the two. The RDP said it clearly. Our basis for international competition is strengthening domestic demand, creating more jobs in the formal sector.

POM     What if foreign countries can supply the goods that the poor need at a lower price than can domestic producers?

BN     That is why developing countries, and that's part of the debate in the Word Trade Organisation, we don't believe that developing countries should just open themselves in that way. You can't close, obviously, but that's why developing countries are fighting that let developed countries open themselves because they are able to deal better with competition, particularly from developing countries, but they are not. Look at the EU at the moment, famine subsidies and even the United States, there is a lot of protectionism in some of the industries but then developing countries are supposed to open everything, lift import tariffs and so on. That is why as a party we agree with COSATU that we can't open ourselves, lift our tariffs faster than what the WTO requires. Partly the reason why there is a difficulty in reaching an agreement in WTO  precisely rests on this question. Countries like Malaysia simply defied the international community and said bugger you, we are introducing measures to regulate inflow and outflow of capital, short term capital, short term speculative capital and that we are actually going to protect some of our industries that are vital. Now whether a country like SA can get away with that is another question but all that I am saying is that this just removing of tariffs, liberalisation and so on is actually making the situation worse in developing countries. So you have this law but whose purpose is this law serving that you must open everything? It's actually not serving the developing countries themselves and then we are heading for bigger train smashes actually the way things are going. It's looks like we might actually start the next decade, the next millennium with huge train smashes.

POM     By train smashes you mean?

BN     Collapses. In many countries that's the way things are going because this neo-liberal paradigm is only benefiting not even developing countries as a whole but trans-national corporations, basically the rich and the better off. That's it.

POM     So trans-national corporations in a way superseded the authority of sovereign states?

BN     Oh absolutely, there is no doubt about that. That is why there was that proposal at this multi-lateral agreement, the MAI whose aim was actually was to say that trans-national corporations are the ultimate economic and political authority, if you like, in any country because once you have entered into these arrangements you can't change them unilaterally and so on. Many countries, fortunately, in the north resisted because that was just the ultimate way now of actually regulating what in fact is daily becoming a de facto situation. I am not so sure frankly, I mean to be frank, to what extent can the world survive at the rate at which these distortions are happening. It's very difficult to tell. Clearly it's actually not going to happen. One proof at the end of this decade is that capitalism is unable to sustain development that is beneficial to the poor.

POM     But what it is doing is that the gap between the rich and the poor, between countries has increased, between north and south has increased.

BN     As well as within countries.

POM     And even within the developed countries the gap between the rich and the poor has increased. So you've got these divisions occurring within countries, between countries and between the north/south axis.

BN     Exactly. So why? Because precisely of these things that we are told we must do.

POM     So how do you see – what should the government be doing that it's not doing?

BN     Well as the alliance we agreed last year, there is a very clear agreement. One, we have to regulate inflows and outflows of capital, particularly short term capital. The second thing that we said, that was in an alliance agreement document, the second thing that we must do actually is we must strengthen the role and capacity of the state to intervene in the economy. All right. And because we had felt that there are certain interventions that we haven't made that we could make, that we can still make, which are not necessarily prevented by the WTO or whatever the case may be.

POM     So when you say 'intervention' you mean like – just give me an example?

BN     An intervention, for instance, to devalue the currency if you think there is a need to do that. The other thing actually would be to say we are going to protect certain industries but what we were saying as the SACP which is the most critical thing is to develop an integrated industrial strategy because the IMF and World Bank they don't want that because they say let market forces determine which industries are going to grow up in your country, which industries are going to fall. No country has ever done that really, even now because there are lots of regulatory mechanisms in the United States, by the way, despite whatever people might actually say. There is a comprehensive industrial strategy which is aimed at trans-national corporations from the US maximising their returns in other places and then protect the steel industry. Right now we've got a problem because the US is regulating steel because SA is one of its serious competitors in terms of quality of steel that we produce in this country, yet we are told we must just open everything anyhow.

POM     So they want you to open your markets to everything and at the same time they don't want to open their market to your steel?

BN     That's right. Exactly. Well it's power but that is mainly the reason why. We think that in fact, the fact that these WTO negotiations have had such difficulties - at one level it's healthy because it shows that at least developing countries are trying to come there with some united positions that are actually going to benefit their own people.

POM     Let me just shift, no pun intended, gears for a moment. There's a law on the book that says that every municipality is entitled to transfer the ownership deeds to people who live in the townships where they have been paying, like in public housing, where they have been paying a rent to the municipal authority for the last 15, 20 or 30 years. That law exists. It hasn't been implemented to any significant degree.

BN     No it has, it has. Literally thousands and thousands of houses have been transferred to their owners.

POM     But shouldn't there be millions and millions rather than thousands and thousands?

BN     Well hundreds of thousands. What are you talking about? What is Soweto? Soweto I think it's actually basically complete. In many townships this government has actually done that.

POM     That's interesting because Essop Pahad yesterday said, "Yes we've a real problem there, it's not being done."

BN     No, as far as I know this thing – I know of townships around Maritzburg people actually have titles in relation to that. There might have been specific problems in Soweto because of whatever, I don't know, but I know Pietermaritzburg where I come from, people actually have got title deeds. There might be unevenness where I might not have been aware, it may be Gauteng there is a problem, but in many, many places I know that actually that is the case. People have paid whatever, their R100, R200 for transfer of title deeds and that's not where the biggest problems are actually in terms of our housing in any case. Our biggest problems in terms of housing is in the informal settlements, that's our biggest headache in this country.

POM     What's your estimate at the moment of how many people live in informal settlements?

BN     Well I don't know, it could be anything, four to five million upward.

POM     That would be a lower boundary?

BN     Yes. I don't have the figures but it's still very large.

POM     You also talked yesterday about privatisation and the government emphasis on privatisation. My understanding of the rationale behind privatisation, and if it's wrong please correct me, is that you have unproductive state assets or assets that are losing money or maybe assets that are even making a low return and you sell them off and with the resources that you get you apply that to debt reduction and interest, thereby the amount of interest you have to pay on external debt. This releases more funds for discretionary spending so that more funds can be used for health, education, social welfare, housing, etc. What's your understanding of what the process of privatisation is about and what is it supposed to achieve?

BN     You see that's nonsense actually that whole thing, to be quite frank with you. If you privatise Escom which is providing electricity to millions of our people, you sell it off on the grounds that you're going to pay off your debt. You have lost that utility, you have lost that asset for ever in terms of actually addressing the needs of ordinary people in getting electricity. Anyway, the goal of privatisation is actually to increase the power and the profit of trans-national capital. It's not to meet the needs of the people. That's our position as the Communist Party and we are agreed with government actually on this as their line that privatisation is not the policy of government. The policy of government is to meet the needs of the people which might involve in certain instances getting rid of useless state assets that you don't need. Maybe the state doesn't need to be running a holiday resort in Mpumalanga, but definitely the state is interested in the provision of telephones but we might then be having a problem that Telkom has got outdated technology and so on. Then you say you're actually going to enter into a partnership. We don't have any in principle objection to that as the Communist Party because you want to inject new technology but we say that must be dealt with on a case by case basis which is what the national framework agreement says, which was agreed to between the unions and government. So there is a big difference between that and privatisation as a matter of policy because where privatisation is as a matter of policy is actually based on the fact that the state must just get out of productive or delivery activities.

POM     Like selling everything left, right and centre?

BN     Yes, which is what the IMF and the World Bank is pushing everybody towards and that is not government policy. Of course it's being contested this thing because there are elements within the state enterprises who actually are – honestly, if you owe money you as a private citizen with a house, you owe a lot of money for a car, you don't say I'm going to sell my house in order to pay off my car and then in future I will be able to find some more money to buy another house. You don't do that. What you do, you might use your house as a collateral or you might actually say I will find some money somewhere, somehow to pay for this or I'll rent this house in order to be able to pay for this car and then I will come back to my house once I'm all right. You're not going to sell your house, you'll never get it again, in order to say that you are actually addressing this. It's like a bond, it means no-one would have a house if we would think that my bond of R200,000 will by the time I've paid it will be R1,5 million so I'm not touching it. It can't be. This thing of saying we are selling off state assets to pay off debt in a country with such inequalities which are getting reproduced by the way every day. You might get four billion rand today if you sell the state assets, you pay off your debts, but poverty and inequality continue to reproduce itself and you no longer have that Telkom and Escom to be able to actually begin. So I don't know whether I'm making sense, it becomes a vicious circle because once that state enterprise has gone it's gone. You will never be able to use it and to adjust it to actually deal with the ordinary means that people will have to face.

POM     But the government's rationale would be that they would use that to put into education, skills training, health.

BN     It's like we are saying you want to sell a school which in the next 20 years is going to produce 40,000 trained pupils because you want to pay a short term thing, and you will never have that school again. So you need a balance. You can't sell state assets because you say you want to pay debt. That can't just be the primary reason, it's a stupid reason because you will get this liquid cash, you plough it into debt but we have lost an important facility in a developing country to be able to actually address the needs of ordinary people. That is the point that we are making as the Communist Party.

POM     If I said that I'm using it to reduce debt but because I've used it to reduce debt we have to pay less interest on debt, which we're obliged to do, that frees more resources on a continuing basis that we can put into social services and social development?

BN     That's a real classic neo-liberal argument. It's real classic, it hasn't worked anywhere in the world, anywhere in the developing countries. You show me a country who have been able to actually improve in the developing world, here on the African continent. I would challenge anybody on it that that approach to privatisation has actually made conditions of the people better – none. Wholesale failure because that was the core of the structural adjustment programmes. It's been a failure everywhere. How do you hope to succeed in SA in terms of that? Because this debt also is being caused by the continued reproduction of poverty. And also what's the ultimate size of debt that a country should have? There is no scientific answer to that so you can't use that as a law, as the IMF and the World Bank are saying – sell off state assets in order to pay debt. It might actually be necessary to keep your deficit at that particular level in order to be able to finance programmes or even support these parastatals to be able to create real conditions for tackling poverty.

     I must just say, we will have to be ending soon Padraig because I've got – in fact I was waiting for a call at 1.45 and then at two o'clock I'm going to another meeting.

POM     Would we be able to reschedule maybe another half an hour?

BN     Well not this year. I'm not sure about next year, we can then try that.

POM     OK. I'll be back in January.

BN     Because my secretary had told me half an hour, that we were going to have today.

POM     I usually do an hour.

BN     No, no. There is no time now whatsoever at this time of the year.

POM     Just two questions, or will you give me ten minutes till two?

BN     I am just worried about this call.

POM     Is it coming through or do you want to make it?

BN     No, I have switched it off but I'm waiting for it. Also I've got just to get five minutes to prepare because I'm going to an important meeting.

POM     What is the most important challenge facing the country in the next 15 years?

BN     It's eradication of poverty and creating conditions for sustainable development.

POM     Why would you not say AIDS? That unless the country gets AIDS –

BN     Well I'm tackling it precisely from this standpoint because, you are right, there is a very close relationship between AIDS and poverty that even your capacity to confront AIDS is severely weakened if you can't actually tackle the conditions of poverty that are actually faced because there is a very close relationship between them. That's why it's developing countries who are actually devastated, but I agree it is HIV/AIDS which is one of our biggest challenges.

POM     Do you think the government is giving enough? I ask government ministers what – it's one of my standard questions to see how they reply – and the only person who said AIDS was Buthelezi. Out of about maybe eight cabinet ministers he was the only one who said AIDS. Everyone else came up with alleviation of crime or of poverty.

BN     Maybe eight, eight cabinet ministers have got AIDS. Is that what you are saying?

POM     No. I said I talked to eight cabinet ministers and I've asked each what is the most important problem facing the country, only one came up with AIDS. It's like it's there and it's preached about but that it's not recognised for the absolute catastrophe that is just – it's like a mudslide that's waiting to –

BN     Well, I think government actually is increasingly focused on this question of AIDS. Obviously it's not enough for a whole range of reasons, our capacity to do this. For instance, one thing that some of us have been thinking about is that maybe as SA we should be trying to deliberately put much more money than what we are doing now on research on AIDS because to be quite honest I don't think these big pharmaceutical companies in the US and so on are actually – it might sound outrageous – but to me I don't think that they have really got commitment to put money into research on AIDS, let's try and find a solution.

POM     The strains they're putting it into, the strain here in sub-Saharan African is called Strain C which is a much more vicious strain and much more resistant to drugs. What the manufacturing companies in the developed countries are doing is, their strain is Strain A and B, and they are making products that address Strains A and B.

BN     Precisely, but you can't fragment the world like that. That is the issue that we are making that there is that imperialist dimension also to AIDS. These companies should actually be putting more money –  I'm not saying we shouldn't deal about awareness and all that.

POM     Yet this year in the health budget, the health budget is reduced. Again it goes back to your point of why are we continually – what's magical about having a zero deficit?

BN     That's right.

POM     Who said, who pre-ordained that?  To go back to, as I heard you say on TV last night, the aim of the SACP is to in the end see a socialist country emerge and the aim of the government, at least the present government and perhaps the government for the next ten years, is certainly not that or certainly wouldn't appear to be that.

BN     But it hasn't repudiated that.

POM     Its policies, if you are to judge it by its actions –

BN     Well that's debatable because I don't think that all of the government policies you can look at them that way because we have also embarked on policies that we regard as very friendly to a transition to socialism in this country.

POM     Like?

BN     Like we have policies that we've actually been pursuing, provision of primary health care, defending of the public schooling system, water provision. Many, many municipalities and it's coming to be a government policy that in fact we have got to provide certain litres of water per month for free. The fact that you have budgets for poverty alleviation and so on. There are many, many things that I can count which are actually – I mean the labour laws that basically are aiming at trying to protect vulnerable workers and workers in general.

POM     It's an issue.

BN     Yes. OK. All right. Sorry, Padraig.

This resource is hosted by the Nelson Mandela Centre of Memory, but was compiled and authored by Padraig O’Malley. Return to the Nelson Mandela Centre of Memory site.