Financialization of the economy and the primacy of rural development in South Africa

Résumé

The aim of the paper is to demonstrate how financialization of the economy has created structural inequalities in South Africa; and to further demonstrate the pertinence of rural development in alleviating the structural repercussions of the finance dominated regime. Financialization of the South African economy relates to the supremacy of speculative reforms, finance and shareholder-oriented motives in the oversight of the economy. The paper exhibits the failures of the dominance of financial and profit-making efforts in South Africa. The paper uses desktop analysis and literature survey to theoretically explore the opportunity space of rural development as a response to the effects of financialization of the South African economy. The paper finds that financialization of the South African economy polarizes and spatialises income distribution for the benefit of the elite minority in the urban financial and corporate space while the rural poor are getting poorer. It further finds that government planning and policy making efforts do not respond directly to the causes of inequality which were framed by the exclusionary economic planning. Moreover, local policy making has left a lacuna in as far as rural community based financial reconstruction and rehabilitation is concerned; instead, development policies seem to give reverence to the accentuation of exclusionary planning for the elite minority. The paper posits that the opportunity space for rural development should be exploited and given concerted efforts to remedy the impact of financialisaton and exclusionary colonial planning. Lastly, community-based cooperatives should be prioritised as appropriate institutional role players in facilitating the process of inclusive and redistributive rural development in South Africa.

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