THE EXIT of the United Kingdom from the European Community is not solely a result of economic forces (who would vote for market turmoil?), but is rather an abject political lesson in democratic power relations. Will Brexit give way to a Brixit, the dissolution of BRICS?
If it wasn’t the constant flow of immigrants from the continent that riled the British voter, then it was the growing centralisation of power in Brussels, the plethora of EU legislation, the imposition of European laws and legal precedents and the resulting erosion of the powerful common law in Britain, which appears to have put paid to the European union for the meantime.
As Larry Kudlow writing for CNBC online put it: “For a country which has routinely acted to limit the power of royalty, which holds stock in documents such as the Magna Carta … Britain will regain its political freedom, its autonomous self-government, and its independence from an European Union that is spinning out of control under the power of establishment elites, unelected and unaccountable socialist bureaucrats, and a court that is increasingly making legal decisions that replace Britain’s powerful common law.”
The same uneasy indictment could easily apply to other economic blocs such as SADC, the AU and its much vaunted rival and successor, BRICS. In the short space of two decades, South Africa’s political leaders have taken our nation into a number of regional and international, monetary and economic unions. The introduction of the Rand-based Southern African Development Community (SADC) on 17 August 1992 was quickly followed by the African Union (AU) 26 May 2001, and then BRICS on 16 May 2008.
By all accounts South Africa is thus a serial unionist. Having arisen like the United Kingdom as an aggregation of several states, including the Boer Republics, Cape Colony and Natal. The country’s first experience as an economic and political union was as a member of the British Empire, followed by the Commonwealth, a block of 52 nations. Then another bout of Republican nationalism followed, with successive periods of relative isolation resulting from apartheid.
Upon the emergence of the new era, a majority government,the Bill of Rights and an inclusive democracy, South Africa embarked on an outward path, which lead to a regional 15 member economic block in Southern Africa including Botswana, Namibia, Lesotho and Swaziland. This was quickly followed by the rise of the 54 member African Union under Mbeki. By all purposes, an attempt to emulate the emergence of the EU.
The result inside the country was a long boom, as South Africa became the gateway of choice to the rest of Africa. But then things began to unravel somewhat. Not content with being a regional superpower within the AU, South Africa, ever much the Casanova of politics, jumped into bed with Brazil, Russia, India and China to form BRICS. All of which, except for India, have atrocious levels of public debt and weak currencies. Brazil was recently given junk status.
It is this awkward attempt to create an alternative to the Post-WW2 Bretton Woods structures such as the IMF and World Bank, which has presented huge problems. The grouping is not simply a marriage of convenience, predicated on the numbers, like the G20, but has come to dominate foreign policy, to the detriment of both the SADC region and the increasingly insignificant AU. Under the Zuma administration, one could be forgiven for thinking that both SADC and the AU no longer exist. The result can be seen in the re-emergence of regional conflict, such as the political turmoil in Mocambique and continental instability.
Time to think the unthinkable. Time for a Brixit?
IF LOCAL economic fall-out and the prospect of capital flight ultimately put paid to President Zuma’s short term economic plans, take a look at what happened to the country’s macro-economic outlook.
After meeting with Chinese President Xi Jinping earlier this month, Zuma announced that he was replacing South Africa’s finance minister with a relative unknown, David van Rooyen, effectively downgrading the status and prestige of the portfolio, which all ended in a massive flipflop, see here.
As to why the President thought he could do this, was not immediately self-evident to the media. Granted, there were many reasons offered by pundits as to why the President would want to remove Nene — the alleged friction around the SAA and Nuclear deals, the inconvenient problem of fiscal prudence and fund raising and so on.
But then Zuma announced that he was redeploying Min. Nene to the BRICS bank. Arguably outsourcing the treasury, and moving Nene to a position in which the Minister had apparently not even been short-listed, never mind appointed. Was this global real-politiek playing itself out at the expense of the country, or simply another expedient marriage?
If you see the BRICS New Development Bank (NDB) as just another bank, all fine, it is easy to forget that NDB aims to counterbalance Bretton Woods structures such as the World Bank, a central bank of central banks, but at what price? Will participation entail domestic interference? Changes in foreign policy? The Nene saga does not bode well.
The covert power-game, surrounding the emergence of a supranational, global cabal — an economic elite focused around the NDB, is really what has been revealed over the course of the month.
Unaccountable, autocratic and without any particular national loyalty, save for the amorphous arrangement which is BRICS, NDB and its cronies, (along with its capacity for intrigue), has been seen by the Zuma administration as the quick fix solution to all manner of national, regional and personal troubles. In other words, a veritable license to print money or issue bonds outside the local economy, that exists as some form of debt birthed out of the peculiar position which its one anchor tenant, China holds within the world economy.
A positive spin, would see it as a safety net, courtesy of the Chinese (PRC), but such conclusions are not necessarily foregone. China itself, experienced a major stock market meltdown, requiring drastic intervention by the PRC party. Turning South Africa into a client-state is thus not necessarily conducive to long-term economic growth and stability. The Johannesburg Stock Exchange (JSE) for example, is a lot older than the Shanghai Stock Exchange (SSE), 1887 versus 1990, a difference of 103 years.
China recently announced that it was issuing Rand-denominated bonds to pay for infrastructure in South Africa, a duty usually the preserve of the Reserve Bank and the treasury.
The events of the past weeks thus beg the question: Does Jacob Zuma see himself as the President-elect of a new country called Afrochinistan? A nation-less, global politician, who recently made the startling statement that his party came before his own country, a leader of a political movement, which now sees itself as the equivalent of the PRC ruling party, in which party congresses are held in what is effectively a one-party state that has no state, except the currency markets.
Clearly Zuma, until the events of yesterday, which saw Pravin Gordhan reappointed, had ceased being accountable to the people of his own country, never mind his own party.
With so many bilaterals, trilaterals and Paris Conference of the Parties, the Zuma administration has really began looking as if it has permanently relocated itself outside of the country. Then, along came a major upset, an open rebellion within the ranks, the reality of Rands and Cents.
Following upon the heels of the Gupta controversy (merely a sad attempt to marry Indian and South African politics), the Xi Jinping meeting has resulted in ANC apparatchiks announcing parallel policies that could take South Africa in the direction of the Chinese political system, with the tragic consequence of an erosion in civil liberties, individual rights and freedoms.
If it isn’t the controversial Cybercime Bill, which could see a National Firewall censoring the Internet, then it is the clampdown on Press Freedom, (or as some might see it, a general purchase of the press), the embrace of radical terrorist groups such as Hamas, and the Dalai Lama debacle, all of which speak to a failure to protect the nation’s secular legacy of peace and human rights, and especially the rights of religious, ethnic and cultural minorities.
LINKING trade with China to human rights and a free Tibet, might sound like mutton cloth, but it could save South Africa’s textile and clothing industry. Hemmed in literally by the World Trade Organisation’s rules that determine how each nation conducts trade, South Africa is being swamped by cheap imports of fabric and clothing from abroad, in particular China.
Skirting around this issue may seem impossible in today’s globalised world, however there is nothing stopping our parliament from enacting trade sanctions that link imports to the development of human rights and even a Free Tibet. China, a nation still without a real democracy, occupied Tibet, a soveriegn nation during the fifties. Once home to a thriving Buddhist community, Tibetans along with the Dalai Lama were forced to flee their homeland.
When will South African’s cotton on, that such aggression is not only a travesty of justice but trade with China means sacrificing human rights — an issue measured not just in clothing, but in local unemployment that is ravishing the textile sector in the Western Cape. Time then to say Lhasa and to link the development of human rights in China, and democracy before trade?
CHECK OUT THE GOVERNMENT OF TIBET IN EXILE