The Defend our Democracy hosted its second webinar of a nine-webinar series on November 18, 2023, led by John Matisonn, providing an innovative forum for discussion, ideas and reflections on 30 years of democracy in South Africa.

This webinar was a watershed moment that addressed an area that could assist South Africa's economy in recuperating: What can South Africa learn from China, Japan, and selected high-growth African states?

The webinar established the framework by demonstrating how other countries have realized remarkable achievements that can be replicated, addressing what approach and solutions must be taken.

Learning from great nations could be a versatile approach that South Africa needs to compete internationally and for the public sector to meet the needs of its people. With the current economic standstill, South Africa must identify gaps and strengthen structural processes to better policy design and implementation.

In this context, Matisonn first unpacked Japan's "miracle" economy after World War Two. According to Matisonn, Japan exploited the Korean War and Cold War as an optimistic blueprint for its economic destiny.

Japan's economy has progressed from textiles to light manufacturing to heavy manufacturing. Its industrial growth propelled it to the forefront of shipbuilding, electronics, precision optical equipment, steel, autos, and high technology. In the 1960s, Japanese exports increased at a rate of more than 15% a year.

Furthermore, one lesson to be learned from Japanese success is that the state needs the private sector, and the private sector needs the state. As such, the government must regulate in the public interest. When the public and private sectors work together as rough equals, high-speed growth is achieved through market-conforming governmental policy.

Another giant to emulate is China, which is now the world's second-largest economy after the United States. The best thing about China is that it has solid bilateral relations with South Africa, which is South Africa's major trading partner, and they are both members of BRICS+.

Matisonn contends that China's success may be traced back to Deng Xiaoping, the world's greatest economic reformer, who saw failure in Gorbachev. Gorbachev was swept up in the forces that led to the Soviet Union's demise, but Deng ensured the survival of the Chinese Communist Party.

Furthermore, Deng's fundamental lesson was to "value what you have until you can make something better!". Right after the United States welcomed China into the World Trade Organization (WTO), China began with agriculture, empowering private sales, township and village enterprises, the SEZs were linked to industrial policy, and a strongly development-oriented leadership emerged with a focus on development performance rather than rigid reforms.

Matisonn holds that China's success is based on its willingness to learn and use its own solutions to determine its own destiny. Furthermore, China's reform is an ongoing process driven by experimentation and openness, and its economic policy is quite pragmatic.

Manufacturing is the foundation of the national economy, the foundation on which the nation is built, an instrument of renewal, and the foundation of a world power. Without a strong manufacturing industry, there will be no country and no nation.

However, one webinar participant commented that China's future does not appear to be as bright as it did five years ago, with another participant proclaiming that the majority of China's production comes from small enterprises with fewer than 500 workers that are closely supervised by local and county administrations.

In terms of high-growth African states, South Africa should look to Rwanda, and Ethiopia as models. Though these stated countries have less GDP than South Africa, their policy planning and socioeconomic makeup is consistent.

Ethiopia first comprehended its prior economic crisis lessons in order to carefully focus on specific industrial sectors to create structural transformation in accordance with a broader vision and strategy.

They concentrated on the agricultural sector, for example, establishing a small industry that exported flowers, which eventually grew into a multimillion-dollar industry bringing in enough foreign money to pay for the import of machinery for its transition to small industrial.

Matisonn goes on to explain that Ethiopian Airlines is performing significantly better than South African Airways, which is on the verge of bankruptcy. The Ethiopian government had made it with fewer resources and could not afford the luxury of political meddling.

Rwanda, like Ethiopia, has focused on a specific sector, tourism, to boost its economy through travel services.

Rwanda has enacted the most business reforms in Africa in recent years. The country has put in place technological devices that have helped to replace its suffocating bureaucracies.

Another critical issue was Deng's advice to Africa, which stated, "You must formulate your own policies and plans in accordance with the actual situation of your own country. Throughout the process, you must learn the lessons in a timely manner in order to keep the good and repair the bad. This may be the most pertinent experience for you."

All of these lessons can be used by South Africa to benchmark ideas for responding to its socioeconomic crisis, build a manufacturing endeavor pipeline, provide facilities for bundled initiatives that have a developmental impact on the green economy, and create a sustainable development and financial system with industry goals.

Written by Tshedza Sikhwari, research intern at Defend our Democracy