The value of market complexities and hard questions

An obscure way from a conversation with Tumisang Ndlovu on PowerFM, a streaming business show based in South Africa.

I’ve been avoiding writing pieces here because I’m developing an interest in longer and more complex problems that don’t fit or accommodate an increasingly obscure Medium writing style. However, there are a few problem sets worth describing within the context of energy scarcity and the abundance of alternatives in the mobility and access context.

Energy scarcity in a controlled market such as the petroleum sector is fundamentally frustrating for countries that are being discouraged from putting barrels to market — while other nations ride revenues from no cuts. At some point the Reserve Bank published a paper talking about circulatory advantages in the global economy — countries taking turns on exposure to volatility (maybe I’ll look for it sometime). Similar principles should apply in the context of complex fuel supply and distribution dynamics — especially in Africa. South Africa’s fuel prices are actually not that high compared to other countries. We seem to be ranked in the middle somewhere. But I can’t help but notice how we lack the resource resilience to protect ourselves from stock shocks and currency volatility. Especially under circumstances wherein the Rand to Dollar exchange looks better than a year ago, but still fuel prices are rising and economists have the urgency to say our currency is the problem. It’s not right now. The problem is simple: we don’t own energy resources for transportation — although it’s all too abundant.

Timing and scale — a rant

Honestly, the technology, techniques are available. All we need now are the skills and the guts to replicate what is available domestically. No imports — just pure DIY. That way we actually get to lock in the real benefits of development. When Chinese manufacturers were starting off on their copy-all campaign, we grew up joking about it! “O direkile machaineng” — only meant we were laughing at the overweight person at the gym, little did we know that all the hours will pay off and their mindset had already shifted. We’re at that point now. Somehow I just feel that the need to imitate is so profound right now, and the patroitism is so obviously linked with domestically consuming stuff made domestically. The sun is an abundant resource and the fact that we have not tapped into it sufficiently and at scale just looks like the simplest, most obvious and most directly beneficial solution right now with more than 1 million job creation opportunities. Instead of following the crowd, with tiny scale solutions and little pilot tests — we need to go big, hit the gym and lift small with ferocious intensity. A Blue Move from a Space perspective.

When South African’s were queuing to vote in the first elections in 1994, the internet was growing at an exponential rate, and many countries were producing tech savvy computer scientists who now practically went from geeky jokes to profoundly influential people.

Why is there fear in the first place? Why are much of the solutions in the basket so similar and limited? Why do the outlandish and loud ideas seem so distant and simplistic? Why do academics laugh at these brashly written blogs? The same reason why the first operator was told it was improbable to win — until a 2000% increase in vehicles operated lead to Toyota eventually bringing all their tools here. When South African’s were queuing to vote in the first elections in 1994, the internet was growing at an exponential rate, and many countries were producing tech savvy computer scientists who now practically went from geeky jokes to profoundly influential people. Many of the transport problems we’re confronted with are not only ours to solve, but are most clearly multi-generational efforts. My biggest concern at the moment, probably over the next few months is about whether the questions we’re asking are truly important, and if they cultivate a new direction of leadership in terms of mobility and access.

There is a crises in transportation in Africa, and many executives can see it: it’s called SCALE. Perhaps I’d like my students then to see the scale and magnitude of the potential in the same breath as the way in which the internet exploded while our parents were in line to cast the first democratic vote. It would be a disservice to miss the emerging questions (in-sourced or outsourced). By scale I’m referring to the exponential nature of change in the mobility and access context — Transnet reforming into a high capital project entity with a potentially huge digital footprint; Minibus taxis turning into a gateway for multidimensional business; municipalities setting up agencies to bring more contact between policy and practice (hopefully); and commuters and operators gaining mutual representation in systems (among others). All this is changing dynamically, and energy is an internal and external dynamic — which many could simply ignore, but is multifaceted across transit units and the persons being transported. This is on the backdrop of a rapidly evolving continent. Not just growing, the African continent is evolving and self-manifesting very interesting proponents that can’t stop surprising me. Can we truly grasp the scale of this change, or are we looking at the apps, maps and datasets?

“From Africa, always something new”- (I think I saw this on the cover of a UNISA magazine titled ‘Decolonising Higher Education’)

Looking back at the conversation tonight around fuel price effects on commuters and operators — all I mentioned were the opportune questions that need answers. It is not the responsibility of government to answer these questions, but it is the responsibility of governance instruments to respond to them effectively. Who is responsible? The shareholders of the country of course. Some private entities and fuel providers may identify the opportunities in hedging fuel for public transport operations; others may see the opportunity to provide stable income models for minibus taxi operators; others may see something else in the energy space too. Others, are very welcome to critique the statements and positions in the interview, because we do lack real debates in the transportation space quite frankly. But yes, in all the obscurity there is some evidence to the effect of asymmetries of information on how the public transport market has been devised and controlled over the years. As a niche, closed market without public debate and education, structural decisions have been bias to both low income and high income interests. Much of the emerging policy, issues and platforms reflect a growing awareness of how important this sector and these issues are.

BRT will work, cities will densify — we know why

Okay, so why are market complexities equally as important as the questions that drive them? One example is the importation of Bus Rapid Transit across the globe, and its justification. The low cost solution argument is sound for a short-term solution, but does not account for the institutional arrangements necessary that trancend the transition process.

Another example is the lurch toward densification of cities, places and corridors. What people don’t seem to ask is how do twelve year olds navigate a high volume pedestrian corridor after school if they may simply be swallowed by the footwork if the sidewalks aren’t appropriately designed. Sometimes the same repetitive limits — Uber’s entry caused deaths:no. The lack of appropriate regulatory responsiveness, bad questions and agreeable government that is all for adoption — but not willing to bear the weight necessary to build from scratch.

There are obvious benefits from linear positions: high densities purport great economies of scale and more efficient public transport — assuming that public transport makes money from patronage. Clearly high volume corridors exist in African towns and cities alike, but they already have services operating along those lines — how is it that what we already have comes as an after thought?

My point is that the counter-intuitive questions are not appropriate for the reinforcing loops behind many of the initiatives. In a way, many adoption oriented places may well catch the wave but struggle to truly ride it because they actually did not need to be out in the ocean in the first place (at that time). So yet again, I’m watching some of the emerging policies, narratives and structural issues come up. Will we be behind again? Adopting, retrofitting, biting bullets and trying to win global validation before actually understanding and fixing our own set of systematic ills? I tweeted somewhere that instead of focusing so deeply on vehicle automation as a market issue — maybe we could turn it into an institutional issue (i.e. research, education and policy). This is just one way I think we could build more informed answers overtime, instead of outsourcing questions in the mobility and access context. That’s just me.

For more long-form work visit www.hlulani.com | That’s the stuff 😉

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