It has been standard for some years, in any analysis of South Africa’s governing party, the African National Congress (ANC), to refer to the “radical economic transformation” (RET) faction. Yet, there has been little serious analysis of what it is.
The RET is difficult to define. It has no clear shape, leadership, membership, rules or policies. It is rather an aggregation of the aggrieved and aspirant within the ANC, linked by a set of broadly shared attitudes towards the state and power. Nor, in conventional terms, is the faction particularly “radical”. The “economic transformation” it seeks is the displacement of white racial domination, rather than the overturn of capitalism.
Despite its vagueness, the RET has become central to the contemporary ANC. It is destined to remain a powerful bloc within the party, and under President Cyril Ramaphosa, a constant constraint on his leadership and any effort to reform the economy and promote clean governance. For that reason, it needs to be understood.
Growth and composition
Its origins lie in the “tsunami wave” which led to the defeat of Thabo Mbeki as ANC president in 2007 by Jacob Zuma, followed by Zuma’s elevation as state president in 2009. During Zuma’s presidency (9 May 2009 – 14 February 2018), the RET faction overlapped heavily with his support base, which was drawn heavily from KwaZulu-Natal, his home province. Yet it was also closely aligned to ANC heavyweights in the other provinces, notably those dominated by the then “premier league” – provincial premiers in three mainly rural provinces Mpumalanga, Free State and North West. Simultaneously it drew heavily on the support of black business lobbies doing business with the state, notably at provincial and local government levels.
By implication, the RET faction was often implicated in the corrupt practices referred to as “state capture”. Yet there was more to it than that. While various “Indian” business people who were tied to Zuma, especially in KwaZulu-Natal, were on the periphery of the RET, the faction itself was largely Africanist politically, protesting a continuation of white power under a veil of democracy.
The faction also drew energy from black professionals fighting against what they depicted as white domination of their professional spheres, and the radical black student lobbies which emerged during the “RhodesMustFall” and “Fees must fall” protest waves of the late Zuma period.
By the time of the December 2017 ANC elective conference, the RET faction was strongly anti-Cyril Ramaphosa and pro-Nkosazana Dlamini-Zuma in the race for the ANC presidency. The narrowness of Dlamini-Zuma’s defeat has provided it with a strong oppositional presence within the ANC during the Ramaphosa presidency, hampering his efforts at reform.
Understanding the RET faction
If it is difficult to pin down who belongs to the RET, it is equally difficult to define what they want. Nonetheless, four broad themes emerge.
First, the motive behind the faction seems to be black economic empowerment, but not the empowerment originally envisaged by Thabo Mbeki with its carefully regulated industrial charters and targets. The RET version was a generalised insistence that the state machinery (government departments, provincial and local administrations, and state-owned enterprises) be leveraged to allocate contracts to black businesses.
This is justified by attacks upon “white monopoly capital”, arguing that the South African economy has changed very little since democracy in 1994, and that white business is covertly determined upon maintaining white power.
The second thrust, closely related to the first, is a generalised attack on the constitutional settlement of 1994-96. The “Mandela compromise” is criticised as having done little to ease the poverty and unemployment of the black population.
The RET is highly ambivalent about the constitution’s defence of property rights but has little respect for the other laws, rules and regulations which the constitution puts in place. By implication, the judiciary is regarded as suspect, as its function is to see that the constitution is enforced.
Third, an overlap with the Economic Freedom Fighters (EFF), which depicts itself as Marxist-Leninist-Fanonist, sees the RET faction driving the call for the state to extend its right to the compulsory expropriation of land. The impetus comes from the fact that, despite the government’s programme of land reform, a hugely disproportionate amount of land suitable for agriculture remains in white hands. The faction, like the EFF, appears to admire the Zimbabwean land reforms of the early 2000s, which saw mass expropriation of white farms, but rarely advocates this openly.
Fourth, the RET faction is a strong supporter of state enterprises. Although the faction would not object to the transfer of state enterprises into black hands, privatisation is feared as likely to result in acquisition of state businesses by white companies.
In any case, the RET faction is heavily embedded within the state owned enterprises. Their operatives allocate valuable contracts to black “tenderpreneurs” – business people who feed on government contracts. By implication, it is opposed to all versions of “structural reform” touted by the Ramaphosa government and lobbies attached to “big business”.
What the RET faction wants
Trying to work out precisely what the RET faction wants is difficult because it has no agreed manifesto. However, three problems stand out:
First, it remains unclear what the RET faction would put in place of the existing constitution.
Should the constitution be reworked, and if so, how? What are the specific flaws in the constitution as it stands? For the moment, all we are left with are generalised attacks on the judiciary for individual judgements the RET dislikes, demands for changes of the expropriation clause in the constitution, and so on.
Second, the RET faction has no general plan for land reform. Crucially, it ignores the increasing domination of agriculture by huge agri-businesses.
These mega-firms are hugely complex operations. It is one thing to expropriate small white farms; quite another to engage in a battle with huge corporations which probably incorporate foreign as well as local ownership. And what would happen to food production if the state were to take them over?
Third, it is common knowledge that South Africa’s parastatals are failing. Eskom, the power utility, can’t deliver enough electricity and is burdened by unpayable debt. Transnet, the transport parastatal, is in chaos, unable to maintain infrastructure needed for business to operate efficiently. The public railway system is a shambles.
South African Airways, the national airline, has collapsed financially and is being propped up by state funding. The Post Office is unable to deliver the post. The reasons for these failures are many, ranging from the ANC’s systematic undervaluation of technical ability to run complex operations, its political deployment strategy, and the mass looting of state bodies that took place under Zuma.
Turnaround strategies have failed. The difficult question for the RET (and the ANC at large) is: if not privatisation, then what?