Two lessons for a four per cent country

My talk at Standard Bank tonight

In April, on a stage in Washington, DC, Sim Tshabalala made a claim that would have sounded reckless five years ago: South Africa could lift its medium-term growth rate to between 3 and 4 per cent. The chief executive of Standard Bank, Africa’s largest bank, grounded the claim in something other than commodity cycles. ‘There’s a direct correlation’, he said, ‘between the rule of law and GDP growth.’

As you read this, I’m on my way to Johannesburg, to give a talk at Standard Bank. My topic is broad – ‘my team and I would very much like to hear your historically and comparatively informed perspective on what can and should be done to accelerate growth in SA, and on the likely effects of AI on our economy’ wrote Tshabalala. Below I share my ideas. I hope that by the end of it you will know how countries that start at South Africa’s current income level have doubled their living standards within twenty years; how fast AI capability is actually growing, measured properly, and where the two models released this month sit on that curve; why the poor got this technology faster than any before it, and why that weakens the standard argument for state intervention; and what the machines themselves think a bank is for in the economy they are building…