In his 2017 classic Fate of the Nation, scenario planner Jakkie Cilliers outlined SA’s three possible paths after projecting an ANC drop below 50% of the national vote in Election’24. But even the founder of the Institute of Security Studies was surprised by the extent of the former ruling party’s decline. He reckons it accelerates key decisions that must be taken if a continued slide towards even greater unemployment and the resulting social chaos is to be avoided. He spoke to BizNews editor Alec Hogg.
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Highlights from the interview
In an interview with Alec Hogg, Jakkie Cilliers discusses the current political and economic landscape in South Africa, emphasizing the potential for both local and international investment. Hogg highlights the significant cash reserves held by companies, suggesting a readiness to invest in South Africa, but notes the country’s tendency to hinder investment opportunities. Cilliers underscores the importance of political stability and the need for a coalition between the Democratic Alliance (DA) and the African National Congress (ANC) to foster investor confidence and drive growth.
Cilliers identifies the ANC’s slow action and internal coalition building as major obstacles to progress. He suggests that the ANC’s radical elements have splintered off, potentially allowing for a more focused and growth-oriented political approach. He argues that South Africa’s growth is predominantly urban, yet the ANC’s support in urban areas is waning. The challenge for President Ramaphosa is to modernize the ANC and shift away from the traditionalist factions that have brought corruption into the party.
Cilliers also stresses the need for South Africa to move beyond race-based policies, advocating for an inclusive approach that attracts both local and international investors. He calls for a focus on education and bottom-up entrepreneurship, rather than top-down wealth distribution schemes. Hogg concludes by recommending Cilliers’ book “Fate of the Nation” for a comprehensive understanding of South Africa’s current situation, lamenting the prevalence of uninformed opinions in public discourse.
Extended transcript of the interview ___STEADY_PAYWALL___
00:00:09:04 – 00:00:33:19
Alec Hogg
Jakkie Cilliers is the founder of the Institute of Security Studies, and he wrote a book in 2017. We spoke to him at the time. That’s seven years ago. And then we updated it 18 months ago. And my goodness, it is almost like telling the future, forecasting what was going to happen. There are a few little adjustments that Jakkie would be able to tell us about.
00:00:33:19 – 00:00:47:12
Alec Hogg
If you haven’t read this book, it’s really worth getting. It is “Fate of the Nation: Three Scenarios.” We’ll find out what scenario we’re on. North South Africans are so confused about what happens next.
00:00:47:14 – 00:01:15:15
Alec Hogg
I know you are abroad. Thanks for finding the time to talk with us today. I’ve just got to refer you back to the opening page of “Fate of the Nation,” where you write that South Africa is always at 5 to 12, or has been for many decades, perhaps even centuries. We’re hitting this five minutes to midnight, five minutes to disaster.
00:01:15:17 – 00:01:43:07
Alec Hogg
And yet somehow we always seem to get around it. But after hearing what’s been happening amongst the politicians in the last week, it does feel like we now really are getting to this five minutes to midnight and this time around, we could have that binary decision that you spoke about the last time we chatted 18 months ago that could be taking the country to a very, very turbulent period.
00:01:43:09 – 00:02:05:19
Alec Hogg
It started with the election. You did forecast the ANC would be below 50%. You were looking at, so when we spoke years ago, you were saying 45, 46, 47% in this election, but you did think that they would be able to cobble together a coalition and retain power until 2029, where the inevitable would happen. They’d be ejected.
00:02:05:21 – 00:02:28:12
Alec Hogg
But this time around, they’ve done even worse than those predictions that you brought, which at the time many people thought were crazy. So you’ve been on the money. In fact, perhaps not as aggressive as you might have been had you written about it 18 months or two years later. So this result, first of all, did it come as a surprise to you?
00:02:28:14 – 00:02:49:02
Jakkie Cilliers
Hi, Alec. Great to talk to you. Yes, you did. And the great surprise, of course, is Jacob Zuma and the MK party, which is the biggest gift that the opposition party, in a sense, could hope for. Bear in mind that with every election, what has happened is it’s not really the opposition parties that have grown.
00:02:49:04 – 00:03:17:14
Jakkie Cilliers
What has happened is that the ANC have lost support and people are not voting. So you’ve had the establishment of Cope, the EFF is now MK. You see the ANC coming down steadily. And the strength of the support that MK got is a surprise, I think. Or a few analysts did get it right as the results of opinion polls in the last few weeks came to the fore.
00:03:17:16 – 00:03:43:23
Jakkie Cilliers
But the question, of course, is where is MK going to go? Because you now have a situation where you have the ANC, in a sense, located centrally, to the right of which is the DA with 21%, to the left of it is the EFF, yes, with marginally less. So an interesting conundrum is presented.
00:03:44:00 – 00:04:14:04
Jakkie Cilliers
The politicians, particularly President Ramaphosa, face a real challenge to come to any kind of solution that holds at a national and at a provincial level. And when we speak provincially, you know this better than I. You’re basically talking about the problem in KwaZulu-Natal, right? Because you can build different coalitions in Gauteng and you need different parties in KwaZulu-Natal.
00:04:14:06 – 00:04:41:11
Jakkie Cilliers
And I previously wrote, this is kind of a trade-off between stability and growth. And the problem is that you need all the parties in the so-called government of national unity. And that means that parties that have really ideological opposition to one another, like the DA, the EFF, and MK, need to be part of one coalition at the national level.
00:04:41:13 – 00:05:04:00
Jakkie Cilliers
And what does that mean for the provinces? And the problem with KwaZulu-Natal is that you have MK, which is a very new party, which is not structured and organized and which has previously said it doesn’t believe in coalitions. I saw it in the Constitution, and how is all of that going to come together?
00:05:04:02 – 00:05:08:13
Jakkie Cilliers
Very difficult. Very difficult decisions that face us.
00:05:08:13 – 00:05:34:08
Alec Hogg
Ramaphosa. But perhaps we could look at it from a different perspective. And that is the one that was provided by R.W. Johnson this morning and supported by Dave Stewart, who was intimately involved in the last government of national unity. Both of them say it’s not going to work because they are two ideologically opposed positions.
00:05:34:10 – 00:05:58:22
Alec Hogg
Even if the MK don’t come with the EFF and the Democratic Alliance, and indeed the ANC is still trying to hold on to power by being the playmaker and putting all of this together. So if the DA doesn’t come into the government of national unity, which is what R.W. Johnson said it won’t do, he says, it’s impossible for it to do. Actually, what happens then?
00:06:02:11 – 00:06:22:23
Jakkie Cilliers
That is exactly the challenge that I think we face. So we are now deep into coalition country. When I wrote “Fate of the Nation” in 2017, I thought we would only get to that point in 2029, which is where I started the discussion by making the point that Jacob Zuma provided a gift to the opposition parties.
00:06:23:00 – 00:06:51:18
Jakkie Cilliers
But the nature of the divisions that we have now are such that if you want to create a government at the national level that can govern, you need parties that are diametrically opposed to one another. And you can invite them, but they may decide to sit this out. The DA in particular, which has emphatically on a number of occasions said it won’t work with the EFF and by implication, with MK.
Read more: RW Johnson: Cyril’s GNU won’t work, his dithering already hitting SA hard, costing jobs
00:06:51:20 – 00:07:14:22
Jakkie Cilliers
What happens then? It is possible that this scenario could face us. I didn’t listen to your interview this morning with elections down the line, but in the meanwhile, South Africa is really going to bumble along. So we are very deep into the scenario that at that point I was saying Bafana Bafana bumbling along scenario because you’re not going to find decisive action.
00:07:15:00 – 00:07:40:06
Jakkie Cilliers
And let’s face it, there’s very little that the DA or the EFF can bring to the table in terms of unlocking growth. And as Ann Bernstein and others have said repeatedly, what South Africa needs is growth. Without growth, nothing is possible. Economic growth requires investor confidence. It requires business confidence inside South Africa, and that is certainly not going to provide that.
00:07:40:08 – 00:08:13:01
Alec Hogg: It’s quite extraordinary. When you reflect on this for a moment, you’ve had negative GDP per capita. In other words, people in South Africa have been getting poorer for the last ten years. Yes, young people have been as a result. They’ve been coming out of school, and there have been less and less jobs for them. And you’ve got laws that surely, to them, must appear to be a bit of a collision between big government, big labor, and big business that stopped them from coming into the job market.
00:08:13:01 – 00:08:40:23
Alec Hogg: They can’t get apprenticeships because, on the one hand, there are minimum pay levels, and on the other hand, there’s labor legislation that no sane businessman is going to hire anybody if they can’t fire them. So you’ve got these two very serious obstacles, which the DA has waved at. The IMF has waved at everybody, it seems, outside of the ANC and the socialist parties in South Africa and see the obvious issue there.
00:08:41:01 – 00:08:58:15
Alec Hogg: And yet, if the DA were to come into this government of national unity, that’s got to be one of its non-negotiables. That doesn’t seem like the other side is ready to accept yet. So it does appear as though this is a bit of a Gordian knot here, which is based on education.
00:08:58:17 – 00:09:28:12
Jakkie Cilliers: Well, it’s politics. And the positions that we have painted ourselves in and the opposition to the various ideological positions within these various camps, let’s say within the DA, within the ANC, and CMK ESF, which are offshoots of the ANC, DA which comes to the party from a different ideology. These positions present us with challenges.
00:09:28:13 – 00:10:04:00
Jakkie Cilliers: The bottom line is that a coalition, the kind of government of national unity, the person from which I spoke about, well, it’s not the government of, it’s going to include a number. If it works, it’s going to include a number of parties above a certain threshold. But ideologically, it’s very difficult to see that working, which is why perhaps, the suggestion that was made at some point, that the DA has provided the opposition position in Parliament, control of various oversight committees.
00:10:04:02 – 00:10:32:17
Jakkie Cilliers: That may be where we end up if that doesn’t work, because I doubt if the DA could become part of a government that doesn’t have if it’s not provided with a certain degree of executive power. Because, as you correctly point out, the number of government positions that are so inimical to economic growth and the issue of cadre deployment actually cannot make employment and so on and so forth, which are really like a wet blanket overgrowth.
00:10:32:19 – 00:10:51:06
Jakkie Cilliers: And the DA will undermine its own legitimacy and support if it enters that. But I think the ideological divisions that we’ve seen are so stark. But of course, that’s what coalition politics is about. It is painful decisions that have to be taken. And I think that’s more or less where we are.
00:10:51:08 – 00:11:11:14
Alec Hogg: Are there any precedents anywhere in the world for a party with the ideological position of the DA coalescing with a party with the ideological position of the EFF, given that they would both presumably be in the government of national unity that Ramaphosa talks of?
00:11:11:16 – 00:11:32:11
Jakkie Cilliers: I’ve been part of a number of delegations that have traveled to Europe to look at coalition agreements. And I think the big difference is that it’s not only the ideological divide, and our ideological divide is wider than most given our history. And so it is also the number of parties that want to be part of this.
00:11:32:13 – 00:12:00:16
Jakkie Cilliers: Normally, if you look at Denmark, Germany, and others, Sweden, they don’t see parties. Maybe for an ostrich that you bring in to create a government of national unity that you bring in to create a coalition government and that provides you with stability. Now even in and the problem is we have, you know, five, four or five parties, perhaps six, that you want to bring into this so-called government of national unity.
00:12:00:18 – 00:12:32:21
Jakkie Cilliers: They are very difficult. The logical partner from just a statistical point of view is the ANC and the DA. But that does not give you a majority. Impossible to tell. Which is why I think eventually, once the ANC looked at those numbers and it looked at the potential for instability and ungovernability in KwaZulu-Natal, which I think is an installation issue, it said, well, we need to bring the MK and the EFF in. This is the quandary that I think we face.
00:12:33:02 – 00:12:58:22
Jakkie Cilliers: So even if you can cobble some type of a government of national unity together, the infighting and the challenges that will happen are going to be intense. So we are in a difficult situation, but it’s not impossible that the situation could eventually lead to new elections. But to think that we are going to manage this process for the next five years, I think it’s going to be very, very difficult.
00:12:59:03 – 00:13:19:13
Alec Hogg: So getting back to “Fate of the Nation,” to those three scenarios of yours, you’ve mentioned the Bafana Bafana scenario, but that is the one that we’ve been carrying on with for the last ten years. We bumble along, we get poorer as a nation, continuously. Social unrest. The potential has to be growing when there are more and more people unemployed.
00:13:19:15 – 00:13:27:00
Alec Hogg: If that continues, is there not a breaking point? At some stage where everything just kind of falls apart.
00:13:27:05 – 00:13:57:13
Jakkie Cilliers: Now, I think that what we need is a political tipping point. We’re almost there. And I had a third scenario, which was “Nation Divided,” and that basically was where you had a serious split within the ANC. And we are very close to that situation. In that scenario, which I wrote in 2017, Ramaphosa emerges as the leader of a new coalition, a sort of centrist coalition, but not as leader of the ANC.
00:13:57:13 – 00:14:20:18
Jakkie Cilliers: Now, we may hit a situation where there could be an additional split within the ANC. And if that happens, then Ramaphosa could step out with what is left of the ANC or a new grouping of former ANC people, and then enter into an alliance with the DA, the IFP, and others to create a governing alliance.
00:14:20:18 – 00:14:45:14
Jakkie Cilliers: I think we are in a situation where these kinds of scenarios now become potentially realistic. That was “Nation Divided.” And over time, given the challenges, that actually emerges as a positive scenario because, instead of waiting until 2029 when, on previous trends, things would change, what you would have is that the point of change has been brought forward.
00:14:45:16 – 00:15:18:18
Jakkie Cilliers: The question that we all need to ask ourselves is what happens in KwaZulu-Natal? You could be able to put together a governing coalition, a pro-growth governing coalition down the line in Gauteng, the economic heart of South Africa. But it depends on your analysis of the extent to which MK and perhaps to this degree, the EFF can play a destabilizing, physical insecurity role in facilitating all this.
00:15:18:20 – 00:15:48:06
Jakkie Cilliers: And I think that, you know, there is a tendency to look back at what happened in July of 2021 and think that MK can destroy the province. I’m using a bit of inappropriate language, and I think that’s a mistake. What happened in July of 2021 is that there were a number of instigators, but the extent of social tension and lack of preparation between the police and the military and delays led to a situation that spun out of control.
00:15:48:08 – 00:16:34:00
Jakkie Cilliers: I think today we are in a different situation. Everybody’s very concerned. So all I’m saying is let’s not overestimate the potential destabilizing effect of the MK party. It’s a loose organization of ANC disadvantaged who are largely from KwaZulu-Natal. But remember that the opposition, the fight for, let’s call it the independence of the province, you would probably have a conflagration between former IFP members and MK members.
Read more: Rob Hersov: Release the beast – there is a way out of our ANC-ruled morass
00:16:34:00 – 00:16:59:19
Jakkie Cilliers: So I think the situation is extremely fluid, but we have to keep in mind the potential for instability. But I don’t think it’s as great as many others. I think that, as Alec correctly pointed out, that the ANC may see this kind of government of national unity as a more preferable option than a coalition of parties that it does not have full control over. And we saw, and it has no previous experience in handling coalitions.
00:16:53:14 – 00:17:18:13
Alec Hogg: What a situation. What should we be looking at? What are the warning signs for international investors, or perhaps the opportunities for local investors? In your book, I was reading through it again. At that point in 2017, there was 1.3 trillion rand in cash on company balance sheets. That’s now about 1.5 trillion. To me, it’s just waiting to be invested in South Africa.
00:17:18:13 – 00:17:34:15
Alec Hogg: But it seems like we just, when we try, we do all the wrong things. We don’t let that money come in. That’s just from locals, let alone international investors. What would be a positive signal? And on the other hand, what would make those investors even more skittish?
00:17:34:17 – 00:18:06:08
Jakkie Cilliers: Well, there’s no doubt that, in political terms, the DA provides the potential for investor confidence in South Africa. Domestically, absolutely. No doubt. So, if you could find a coalition where the DA and the ANC can get together and provide a growth future for South Africa, and again, present to the host, there have been any number of books and publications that have been written.
00:18:06:12 – 00:18:38:04
Jakkie Cilliers: We know what needs to be done. The problem is that the ANC firstly doesn’t believe in that. And secondly, when it takes action, it takes action extremely slowly. It’s almost impossible to see any real movement, as the ANC is engaged in internal coalition building within itself. Now, perhaps what has happened is that to a degree, you’ve got a bit of a purified ANC in the sense that some of its radical elements have spun off and joined MK.
00:18:38:04 – 00:19:04:07
Jakkie Cilliers: So perhaps that provides the basis for the normalization of South African politics—that the ANC stops trying to be the broad church that it has been, and that it has to choose an ideology, a roadmap along which it goes. If you want to grow South Africa, growth happens in urban areas. And the trend with ANC support in urban areas is clear. It’s declining. And the main message of “Fate of the Nation” was that the ANC faces a declining future.
00:19:04:09 – 00:19:34:02
Jakkie Cilliers: The big challenge that Ramaphosa has is to modernize the ANC. And that can only happen if you step away from the alliance that was established after 1990 between the traditionalist factions, particularly in the former homelands, which also brought all the corruption into the ANC. There has been a tremendous amount of interesting work that shows the extent to which the so-called former homeland parties that became part of the ANC really brought all the corruption and those problems into the ANC.
00:19:34:04 – 00:20:05:06
Jakkie Cilliers: So, for a leader who wants to take his party into the future and wants to retain power, does Ramaphosa have the leadership skills and the intent to shift the focus of the ANC to benefit from the urban black vote? Because what is happening is that no opposition party, neither the DA nor the EFF, nor MK has been able to capture the black urban vote, which is staying away, which is not voting.
00:20:05:06 – 00:20:28:01
Jakkie Cilliers: What South Africa needs is a party that brings South Africans together into the future. Many of us were hoping that “Rising Sun” would provide the basis for that, and perhaps they can, but we need to mobilize the stay-away vote in urban South Africa if we are going to build a future. We also need to step away from race-based policies.
00:20:28:01 – 00:21:13:04
Jakkie Cilliers: You cannot build a prosperous, united, non-racial, democratic South Africa with policies that are based on race. This doesn’t mean that you shouldn’t provide opportunities to rebalance differences in South Africa. Of course, you must do that. But, as you yourself pointed out, you need to move to a situation where international investors don’t feel that their investment in the country will be squandered through various get-rich schemes under the mantle of black economic empowerment. We have to find a different way.
00:21:13:09 – 00:21:35:01
Jakkie Cilliers: The way to do that is through education and entrepreneurship from the bottom up, providing an opportunity economy—not trying to do it from the top down by creating entrepreneurs who are handed opportunities but don’t have the skills to manage them.
00:21:35:03 – 00:21:55:23
Alec Hogg: Lovely talking with you again, Jakkie. Thank you for your insights during this very treacherous period that South Africa is going through. I would recommend to anybody who wants to understand where we are, it’s all been written in “Fate of the Nation.” You can get the proper background. Unfortunately, there’s just so much hot air being spoken about nowadays.
00:21:55:23 – 00:22:30:15
Alec Hogg: Everyone has an opinion, not often based on fact. Jakkie Cilliers is the founder of the Institute for Security Studies. I’m Alec Hogg from BizNews.com.
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