46 min

Ayabonga Cawe — Entrepreneur, Development Economist, Radio Presenter, Author

With Ayabonga Cawe — Entrepreneur, Development Economist, Radio Presenter, Author

PeopleMoneyResilience

In short

Development economist and Metro FM presenter Ayabonga Cawe explains why South Africa's inequality, not simply poverty, drives unrest, and why the spatial design of townships and former homelands blocks ordinary enterprise. He argues for developmental local governance, localised food production, rezoning township land and pressure on pension trustees to fund the real economy, drawing on his book The Economy on Your Doorstep. The one takeaway: South Africa's crime and unrest track inequality rather than poverty alone, which is why the former homelands see less of it than places where extreme wealth and destitution sit side by side.

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Who is Ayabonga Cawe and how did he end up writing about the economy?

Born in Komani, formerly Queenstown, in the Eastern Cape, he trained in economics and finance but decided early he would never be an economist working in a bank. He has worked across consulting, NGOs, broadcasting and policy, hosts a show on Metro FM at the SABC, and has written for Daily Maverick and Business Day.

What does he think actually caused the July unrest and looting?

The systematic alienation of the majority. Hungry people locked out of the informal economy were offered a compelling picture of open mall gates, and collective action lowered the risk of arrest. Behind that, he argues, sat economic saboteurs targeting network industries, warehouses, manufacturing capacity and even water treatment plants in KZN.

Why does he insist on going back into history to explain today's economy?

Because he cannot understand the reality he grew up around without it. He describes more than a century of state-led dispossession of land, livestock and any means of surviving outside wage employment, leaving the former homelands as economic wastelands with poor land quality that exist to serve the urban core economy.

Why is his book not a typical economics book?

It opens with an African woman being shot by police in a township in the 1980s. He argues that scene befits a South African economics book, and that conventional accounts talk only about firms and entrepreneurs while ignoring the household as a site of production, reproduction and redistribution of resources.

Why does he frame social grants and a basic income grant as more than a handout?

Because people were stripped of assets using fiscal measures, including poll taxes, quit rents and hut taxes levied to force them into wage labour. A grant is partly reparation, and partly a response to a society where cash is needed to eat and be sheltered while the majority sit outside wage employment.

What does he say to white South Africans who feel despondent about the country?

That the white community has suffered a deep lack of leadership since 1994, delegating responsibility to the ANC and demobilising progressive forces while retreating into paranoia and enclave economies behind high walls. He says that strategy has reached its structural limits, and calls for leadership that recognises how intimately linked its interests are with the majority's.

Why is it so hard to run a business from a township home?

Dormitory-style townships like Soweto have almost all land zoned for residential use only, unlike ordinary neighbourhoods with a diversity of zoning for business, amenities and housing. Trading from home is therefore effectively illegal, and rezoning can cost hundreds of thousands of rand.

What should ordinary savers be asking about their pension money?

Where it is being allocated. With around R4.5 trillion in South African pension fund assets, he says returns mean little if the country burns, and urges savers to press trustees to show investment in the real economy that employs visible people. Many workers, he says, would accept slightly lower returns for that.

Does he think Cyril Ramaphosa has what it takes?

He calls the question unhelpful, because economic outcomes are not set by one person's subjective qualities unless that person is a dictator. He credits Ramaphosa's commitment, citing his work on the national minimum wage and his earlier leadership of a major mining strike, but says the real test is whether the wider collective can lead change.

In their words

Taken from the recording, word for word.

It's a book that starts with an African woman being shot by the police in a township in the 1980s in South Africa. Now, that might not seem like a scene that is befitting of an economics book, but it's a scene befitting of an economic spoke in South Africa, because that's where we come from.

— Ayabonga Cawe

Your returns mean little if the country is going to go up in smoke. Your assured incomes in terminal time T when you go and retire means very little if you're living in a society that is a burning inferno around you.

— Ayabonga Cawe

You seldom find a proper road that links one village to the next because those those economies were never expected to operate like that.

— Ayabonga Cawe

So throwing up our hands is not a strategy because it's not an option open to us.

— Ayabonga Cawe

Key takeaways

  1. South Africa's crime and unrest track inequality rather than poverty alone, which is why the former homelands see less of it than places where extreme wealth and destitution sit side by side.
  2. Townships and former homelands were built to feed labour and money into the urban core, so roads, rail and telecoms rarely connect one village or one neighbourhood to the next.
  3. Concentrating production in corridors such as Gauteng to Durban creates both an economic and a security vulnerability.
  4. Developmental local governance means municipalities and local business collaborating rather than training their guns on each other, since no investor commits without assured water, electricity and roads.
  5. Localised food production, from home gardens to church plots, would give people skills, meaning and a way to survive when jobs are unavailable, instead of routing every grant into the mainstream retail system.
  6. Throwing up one's hands is a luxury available only to some classes, because for people from the urban periphery and rural areas there is no plan B.

Show notes

On this episode I chat with Ayabonga about his journey and the launch of his book The Economy On Your Doorstep.

In my opinion this is a must read for every South African entrepreneur and manager.

 

https://traceymcdonaldpublishers.com/product/the-economy-on-your-doorstep-by-ayabonga-cawe/

 

https://wattsinvolved.co.za/

 

https://davidwattsblog.com

Frequently asked questions

What is a cultural worker?

Cawe's own description of what he does: operating in multiple spaces to try to shift how people think and act on the things critical to their survival. He offers it in place of the label of activist.What does he mean by agrarian dualism?

Where can the book be bought?

In paperback in reputable bookstores, and as an e-book and Kindle version online, including on Google Play, Rakuten Kobo and Amazon.

What is Iziko Connect?

An Eastern Cape project Cawe is running that has set up Wi-Fi hotspots in Komani and Tsomo-area high-footfall communities to lower barriers to connectivity. It was completing a year of operation on 1 August, run as a pilot they hope to scale across the district.

How does he explain jobless growth in banking terms?

He asks how often people now visit a bank branch compared with the past. As everything shifted to apps and branches closed, direct and auxiliary jobs went with them, showing capital can accumulate without needing to employ people.

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