Speaking during a debate on “Building a self-reliant township economy” in the National Council of Provinces (NCOP), the Chairperson of the Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour, Mr Mandla Rayi, says South Africa must develop a truly inclusive economy and sustainable economic development. Sakhile Mokoena reports on the debate.

To achieve this goal, the Chairperson said, South Africa must invest more resources in developing townships and rural areas, where the vast majority of the population live. An inclusive economy should be able to create new opportunities for those who were previously excluded.

He attributed the skewed economic development to colonialism and apartheid, which he said created a geographical pattern of core and periphery regions. This geographical pattern, according to Mr Rayi, confers benefits to metropolitan areas that enjoy the advantages of sophisticated economies and links to regional and international markets at the expense of the rural and township peripheries that are located far from key infrastructure.

“The national government’s geographic strategic infrastructure projects, as well as the aspiration to shift freight from road to rail must address the issue of public transport infrastructure to a level that can establish seamless links between township economies and regional markets,” he said.

The committee Chairperson said the involvement of township enterprises in the manufacturing value chain must be accompanied by promoting regional integration and taking advantage of the African Continental Free Trade Area. “The need for industrial development in townships is necessary to create an inclusive economy that serves all South Africans and to address the existing spatial division in our country and to bring work to our people. We need to transform townships from being labour reserves, largely consumption based, into productive hubs that serve the needs of the community, township economy is a key driver of transformation and economic growth, poverty alleviation and the creation of decent sustainable jobs,” argued Mr Rayi.

He welcomed the implementation of the District Development Model (DDM) as an important intervention to strengthen the capacity of municipalities to manage their own affairs and to more effectively manage the use of resources in the three spheres of government in order to achieve efficiencies and economies of scale.

However, he criticised the model for what he said was a lack of detail on how it intends to respond to a lack of capital investment in public transport infrastructure, especially rail transport, that can transform the polarising effects of the apartheid and colonial spatial patterns of the urban-rural divide.

Participating in the debate on township economy, the Deputy Minister of Small Business Development, Mr Sdumo Dlamini, told the NCOP that work to remove the remaining effects of apartheid is ongoing. “The starting point in this debate should be to acknowledge that our spatially segregated urban development was first designed along racial divisions, and that townships and rural villages were a source of cheap and unskilled labor at the service of the white colonial and apartheid economy.”

The government’s vision, he said, is to build urban spaces that are spatially and socioeconomically integrated, free of racial and gender discrimination and segregation, enabling people to make residential and employment choices to pursue their ideals.

The Deputy Minister said the work of building a self-reliant and vibrant township economy is linked to the work being undertaken by the departments of Human Settlement and Agriculture, Land Reform and Rural Development on spatial planning and land use management services. “Experience has taught us that real economic impact is often achieved if township enterprises, based on their principles of cooperation and solidarity, are clustered together to benefit from supply linkages and greater economies of scale,” Mr Dlamini said. 

NCOP Delegate Mr Mlindi Nhanha argued for the inclusion of rural areas in the debate about development of township economy. “A debate about township economy is correct and relevant. However, I do think it is exclusionary. Rural areas in our country largely comprised of former Bantustans where in the past were left to fend for themselves and it can’t be right that again these under developed areas are once again left to fend for themselves,” said Mr Nhanha.

Another NCOP delegate Ms Brenda Mathevula decried the mushrooming of shopping malls into townships, labelling it “the spread of capitalist tentacles” and a threat to the little that townships have today. She said while malls provided jobs, they do not contribute much to the real economic development of townships. “Townships were created as labour concentration camps in order for white owned industry to have endless supply of cheap labour from black people.

“In the internal geopolitics of the country, townships were never designed to create or sustain any form of economy, their primary purpose is to supply cheap labour to white industry. Townships are affected by the triple tragedy of poverty, unemployment and inequality. They are by nature characterised by poverty, inadequate healthcare, lack of basic services, lack of water and sanitation, poor housing infrastructure.”