THE FIRST FIFTEEN YEARS OF DEMOCRACY IN SOUTH AFRICA FROM THE PERSPECTIVE OF DR. FRANS CRONJE

Extract from a 24 November 2025 interview between Dr. Mbuyiseni Ndlozi and Dr. Franz Cronje, broadcast by the African Renaissance Podcast. Radio Freedom wishes to express its gratitude for the permission to reproduce this extract and to also post the interview itself.

MASSIVE IMPROVEMENTS IN THE BASIC LIVING STANDARDS OF MILLIONS OF PEOPLE – 1994 to 2009

In the period 1994 to 2009, under ANC led governments, there were massive improvements in the basic living standards of millions of people. The fiscal position strengthened in a manner which showed that the living standards picture would transform fundamentally.

In 1994 the ANC inherited an economic catastrophe. South Africa had last seen high levels of economic growth through the 1950s and 1960s.

When it assumed power, the ANC inherited a debt to GDP ratio of 49%.

However, just more than a decade later, 13 years later, it has cut the debt to GDP ratio by half.

When the ANC came to power, it inherited a very high budget deficit, standing at 7,3% of GDP in 1993.

Thirteen (13) years later as the debt curve had come down the deficit turned into a surplus.

The state was earning more in revenue than what it was spending and it did that essentially for three consecutive years, namely 2005/6 and 2007/8.

That was the first multi – year surplus since the formation of the Union of South Africa in 1910.

IMPROVED QUALITY OF LIFE AS A RESULT OF GDP GROWTH AND INCREASED EMPLOYMENT

The number of people in employment increased from 8 million in 1994 to 15 million by the time Mr. Mbeki departed as leader of the ANC and of the country.

Through the years of Mr. Mandela and Mr. Mbeki as Presidents, South Africa created 500,000 net new jobs per year. Through the era of Mr. Zuma that was 250,000. Through the era of Mr. Ramaphosa we haven’t held the number above 100,000.

The tale told by some that these were years of jobless growth is and has always been a complete fabrication.

At the same time as she was doing wonders on the jobs matter, democratic South Africa rolled out the most expansive welfare program of any emerging market. The number of people who received some cash payment from the State every month increases from about 3 million in 1994 to around 12 million by the time Mr. Mbeki departs.

But this was being achieve through the saving on the government’s  interest bill because as its debt came down, the interest payments were reduced and the saving on the interest bill was redirected into starting the social welfare program.

So during these early years of our democracy, you’re doubling the number of people in employment. You’re expanding access to welfare from 2 to 12 million people.

We read about people who went to bed without electrical connection in their home. So, when they close that door that night on this dark house, they have maybe a candle, lamp or something like a little paraffin light.

49% of the population was in this situation in 1994, but that came down to 19% by 2008.

No emerging market has ever matched the scale of the service delivery successes recorded in South Africa’s first decade and a bit after 1994.

10 formal houses were built in the country for every one shack that was newly erected, despite a huge flow of people to urban areas.

And this was done despite a compounded demand which derived from the fact that household size in South Africa fell by a third because when people become more prosperous the size of a household shrinks and that adds to demand.

The point of all this is to say that we can go on and list more of these things

BY 2008 MURDER RATE IN THE COUNTRY DECREASED

Let us take the murder rate after 1994. It was inherited in 1994 at 67 per 100,000. That means that 67 people were murdered in the country in 1994 for every 100,000 people that were in the country. That bottomed out at 31 for every 100,000 around 2008.

So wherever you look, the macroeconomic management, the fiscal position, the debt position, the deficit position, the job creation position, the social welfare roll out, the service delivery position.

All of this is seeing an absolutely astonishing improvement in the basic living standards of people. Democratic South Africa’s first 15 years saw a vast lift in the basic living standards of millions of its people. So, there’s this universal lift in society.

This includes the Afrikaner people. A joint study concluded by the eminent Afrikaner historian, Prof. Herman Giliomee and Dr, Frans Cronje estimated that in the 20 years after 1994, Afrikaner living standards might have risen faster than in any 20 year block of South Africa’s history going back to the end of the Second World War.

A truly comprehensive examination of post-apartheid South Africa would also show such interesting facts, for instance, as that the share of protest actions in the country that are violent reduced from somewhere around 15% to 20% in 1994, to around 7% about a decade later.

One of the most striking numbers concerning the middle class, that somewhat summed up what was starting to happen in the new South Africa, was that whereas in 1991 there were 44 whites who got a degree in engineering compared to one black graduate, something like 15 years into democracy that figure had changed.

The ratio now favoured Black engineering graduates. Yet the number of white graduates is not materially less than it had been in 1991.

In other words, the phenomenal growth of Black engineering graduates did not diminish the number of white engineering graduates.

In this context, forensic study says if South Africa’s rate of economic growth had continued at what it was between 2004 and 2007, today the unemployment rate would not be over 30% but would be closer to 10%.

And the number of people in employment would be approaching 10 million more than the current 17 million people in one kind of employment or other, amounting to something like 27 million. The country would have been a very, very different place.

One of the things we must mention, which is a foundational number in some respects, is something called fixed investment rate. What that measures is how much fixed capital of hard money is being committed to new projects in South Africa in a year, as a share of the size of the overall economy. Now when the ANC came to power in 1994, the number it inherited from the previous regime was 15%.

By around 2008 the number had broken through 20%. It had reached 22% and was threatening 23%

That is very important because our emerging market peers average fixed investment rates were 25% of GDP and up to around 30%, and even more in some instances.

We were well on our way to that, and as a consequence of which we generated the growth that made possible the revenue and the job creation and the lifting of the standard of living.

Through the 2008 global financial crisis, the number collapsed. The fixed investment figure fell back to 15%. It never picked up again and it has stayed at 14% or 15% ever since, and it remains there today.

Now, at 15% the fixed investment number, we think is perfectly consistent with the idea of the South African economy growing at around 1%. If we lift it from 15% where we are now, to 25%, the effect will be to raise the rate of economic growth back to 5%, and above 25% to more than 5%. We would be back on the track on which we were before. So, you might say that that underneath everything is the fixed investment rate which is the foundation.

There are some economists who have argued that South Africa owed its relatively high economic growth rates in the period 2005 to 2008 to the then commodity boom. This assessment is not correct. It is disproved by the fact that for the past decade, some of our emerging market peers, themselves dependent on commodity exports, have all grown at four times our own rate of growth.

And so their growth rates are not determined by the vagaries of commodity super cycles and ours wasn’t either. And it is still not the case.

A critical thing for our country to come right is that we must have an internal focus of control, which takes the circumstances we have and make a success of it, and not become a country that allows things to happen to us from outside, and we then say there’s nothing we can do about it or not much.

To a very great extent, the first era during the years of democracy reflected an administration that had an internal locus of control.

Too much that’s coming out of the second era post – 2008 is an administration that says – you know it was tough out there. There’s nothing we could have done.

During the period we are discussing, concerning the vote share of the ANC in parliament, which is a scoreboard in politics, you will find that the share of votes obtained by the ANC in 2004 was six percentage points higher than when Mr. Mandela led the ANC and South Africa to liberation in 1994.

This speaks to the point that the success and strength projected by that early ANC reflected the cumulative consequences of the vast increase of living standards across the board.

PEOPLE WERE VOTING ON THEIR MATERIAL CIRCUMSTANCES

The reason ANC support was up as high as it was in the 2004 election was because the ANC government was doing a pretty decent job from the mess it inherited. While respecting the role of the ANC in the emancipation of the people, these people were not voting on liberation loyalty.

They were voting on their material circumstances, and this is what we’re seeing in the protest movement. And if the protest movement reached some kind of a peak, which in a sense it did with the events in July 2021, the voting pattern will begin to shift.

So, it was all very predictable what would occur and is now what has occurred. And if you sort of think back on all the numbers we discussed earlier, the 500,000 jobs per year of the Mandela and Mbeki years, the 250,000 of Zuma, the well under 100,000 of Mr. Ramaphosa, you might ask someone “What do you think was going to happen in these circumstances?”

Many in our country had expected a gear shift in our country’s socio-economic trajectory when President Ramaphosa took over. We are now speaking of him being in office for seven years, more or less. That gear shift has not happened.

The consequence has been the greatest test in the democratic South Africa, which has been the ANC going down to 40% and that without a single drop of blood.

END

Extract from a 24 November 2025 interview between Dr. Mbuyiseni Ndlozi and Dr. Franz Cronje, broadcast by the African Renaissance Podcast.