SA’s R50m Cuba gift should never have been a priority, says economist

SA’s R50 million donation to Cuba has raised the emotions of even economists, with one stating Havana should be at the bottom of South African priorities.

Efficient Group chief economist Dawie Roodt said R50 million was too small to make a noise about – but in a country with high unemployment, poverty and hunger the figures mattered as they added up in the long run.

“It’s all good and well you have to support your comrades in the liberation struggle in the old days, but that’s ancient history. You have to spend money where it matters the most: your country.”

This week, Deputy Minister of International Relations and Cooperation Alvin Botes told the portfolio committee on international relations and co-operation that the money would be used to help Cuba alleviate food security, due to hunger resulting from sanctions imposed by the US.

But macro-economist Miyelani Mkhabela, CEO and chief economist at Antswisa Transaction Advisory, had a different view on the relations between SA and Cuba.

“The South African economy is three times bigger than the Cuban economy. Our economy has capacity to donate funds to Cuba, as Cuba has helped South Africa in fighting for freedom,” he said.

“We cannot leave Cubans and Palestinians to suffer, as they participated in fighting for freedom and Cubans supported South Africa 2020 and 2021 during Covid.

“Cubans are suffering because of fighting for South Africa to get freedom and South Africans must remember that when they sleep every day,” Mkhabela said.

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There are strong feelings on both sides of the political divide as the ensuing debate pitted the conservatives against the progressives and radical in the South African society. The conservatives believe it’s a waste of scarce resources, particularly as many South Africans suffer from hunger and high unemployment.

DA MP and portfolio committee member Willem Faber lambasted the ANC for “going out of its way to find new means to splurge money on Cuba”.

“Over the past decade, the ANC government has spent R1.4 billion just on agreements with the Cuban government to employ Cuban workers and service providers in South Africa – money that could’ve been spent on creating job opportunities and alleviating food security issues back home.”

According to Roodt, SA should rather establish strong economic ties with China, America and Europe. Cuba should be at the bottom of the list of other countries.

“Loyalty and camaraderie and past history go so far and no further. I think the ANC government is overdoing this,” Roodt said.

In 2020, GDP per capita for Cuba was just under $9 100 (about R139 000), while South Africa’s was just over $5 000. Stats SA figures showed this country’s official unemployment rate stood at 34.9% in the third quarter of 2021, while the number of employed persons decreased by 660 000 to 14.3 million.

Cuba’s unemployment rate was 3.50% by the end of 2021. It is expected to trend at about 3% this year and 2.20% in 2023.

– ericn@citizen.co.za