A domestic policy think tank called this week for the creation of a “blue ribbon commission” to study the relationship between growth and economic transformation in South Africa and to make recommendations as to how opportunities for black business could be expanded in a way that encouraged economic inclusion rather than “elite enrichment”.

Blue ribbon panels were convened frequently in the US to allow a group of independent experts to investigate given challenges, questions or areas of controversy.

The proposal formed part of a far larger set of recommendations packaged by the Centre for Development and Enterprise (CDE) under ‘The Growth Agenda’ banner and comprising seven separate reports, which were released on Wednesday evening at a well-attended function held at Constitutional Hill.

The event was addressed by CDE executive director Ann Bernstein, as well as leading business personalities, such as First Rand and CDE chairperson Laurie Dippenaar, Investec Bank chairperson and Tiso Group founder Fani Titi and businessperson and activist Mavuso Msimang.

The reports were compiled over the past two years and had been published primarily to stimulate debate on the policies South Africa could pursue to accelerate growth, create mass employment and bolster economic inclusion.

They contained a number of controversial policy proposals, from setting up an export processing zone, where employers could pay lower wages than would be the case in the rest of the economy, to recruiting more foreign skilled labour.

But CDE’s overall argument was that economic growth mattered for employment and poverty alleviation and that accelerating growth should, therefore, be a top priority for South Africa. “The bottom line is this: South Africa needs accelerated growth that is urban-led, private sector-driven, enabled by a smart State and targeted at mass employment,” the CDE said.

The reports had been produced against the backdrop of a slowing South Africa economy, which was expected to grow by less than 1% in 2016, owing to a combination of domestic constraints and external headwinds, including a slump in commodity prices.

The growth slowdown, together with rising inflation and concerns over South Africa’s fiscal balances, would also feature heavily in impending reviews by ratings agencies of South Africa sovereign rating, which was at risk of being downgraded to junk.

In addition, the reports had been released amid growing disquiet over South Africa’s performance in the area of economic transformation, with black businesses still struggling to make market, ownership and control inroads. As a consequence, government had tightened the rules associated with broad-based black economic empowerment (BBBEE) in a bid to address fronting and to encourage the development of new black-owned and controlled firms, particularly in the manufacturing sector.

Black business, however, remained frustrated by the lack of opportunity, particularly in the private sector, while there was also growing societal dissatisfaction over perceptions that empowerment programmes had served only the interests of a small politically connected elite.

Bernstein stressed that economic growth in South Africa was not possible without transformation, not only from a social justice perspective, but also because the predominantly white middle class was “too small a foundation on which to erect a dynamic entrepreneurial economy”.

Nevertheless, the current structures and obligations associated with BBBEE and employment equity had costs that were not fully appreciated or acknowledged by policymakers. South Africa’s current approach to transformation, the CDE argued, was biased towards elite enrichment, which was undermining growth.

“We need to find a way to align the goal of promoting economic transformation with that of expanding the economy as a whole and opening opportunities to all South Africans,” she said, while also acknowledging that more study and thought was needed “to create a system that better achieves the goal of expanding opportunities in the economy while imposing less of a burden on firms and their managements and without crippling the State”.

Bernstein argued that South Africa needed to change the structure of wealth and opportunity not only for “insiders”, but for “millions and millions of people”.

“In our view getting the relationship between transformation and growth right is one of South Africa’s most urgent priorities. We are proposing that business should consider funding a blue ribbon commission to look into transformation and growth,” Bernstein said.

The commission could assess ways to build on what had been achieved over the last 20 years in the area of transformation, while seeking to address the “unintended negative consequences” for growth and employment.

"Without growth, South Africa’s politics will decline into a progressively disruptive, increasingly racialised and radicalised squabble over a shrinking economic pie."