SA’s seven ‘Fi­nance min­is­ters’

The Witness - - OPINION - Fe­rial Haf­fa­jee

THINGS fall apart when the cen­tre can­not hold and for a pres­i­dent who sailed to power on a prom­ise to fix the econ­omy, Cyril Ramaphosa is not do­ing well.

One rea­son may be that South Africa has too many Fi­nance min­is­ters. I know there’s only one of­fi­cial politi­cian who holds the ti­tle and that’s Nh­lanhla Nene, but the mes­sage gets con­fus­ing be­cause there are too many cen­tres claim­ing author­ity over eco­nomic pol­icy.

When he was run­ning for ANC pres­i­dent, it looked like Ramaphosa would make him­self the cen­tre of eco­nomic pol­icy-mak­ing. He pub­lished a “new deal” doc­u­ment with a set of sen­si­ble growth and em­ploy­ment-fo­cused poli­cies that you would have ex­pected to be­come the heart of eco­nomic pol­icy once he was in­au­gu­rated as pres­i­dent in that heart-warm­ing mo­ment in Fe­bru­ary.

Many pres­i­dents as­sume the man­tle of eco­nomic pol­icy czar if they in­herit ad­min­is­tra­tions of tepid growth and low em­ploy­ment. If Ramaphosa had made his pres­i­dency that cen­tre, we would be in stead­ier times. But he has not and in­stead there is pol­icy may­hem.

Con­sider all our Fi­nance min­is­ters. There is Nene who runs the Bud­get but not pol­icy. He has an­nounced a set of eco­nomic stim­u­lus mea­sures but has not been able to say what these might be, be­cause the na­tional Trea­sury is no longer the heart that sets the coun­try’s eco­nomic pol­icy beat.

Whereas for­mer pres­i­dent Thabo Mbeki had a strong eco­nomic pol­icy bent, he de­ferred author­ity to his Fi­nance min­is­ter Trevor Manuel, SA’s long­est-serv­ing of­fi­cial in that role.

By ap­point­ing four so-called “in­vest­ment lions” in April, Ramaphosa sig­nalled a for­eign in­vest­ment-led growth strat­egy. But Nene’s growth strat­egy is do­mes­tic stim­u­lus-led. I know these two pol­icy out­looks can work to­gether, but there is a glar­ing ab­sence of clar­ity.

At Luthuli House, Enoch Godong­wana heads the gov­ern­ing party’s eco­nomic trans­for­ma­tion com­mit­tee, an oxy­moron of a po­lit­i­cal ti­tle if ever there was one be­cause none of its ideas has man­aged to grow or trans­form the econ­omy.

Still, this pow­er­ful com­mit­tee holds supra author­ity over eco­nomic pol­icy be­cause SA has a party-based sys­tem of po­lit­i­cal power, which makes Godong­wana a de facto Fi­nance min­is­ter.

He has put out a sep­a­rate set of eco­nomic stim­u­lus ideas at odds with those set out in Ramaphosa’s New Deal, which you as­sume the pres­i­dent still be­lieves in. Godong­wana and his com­mit­tee’s key idea is an in­fra­struc­ture growth spend­ing model but, again, it’s at odds with a Bud­get so deeply in the red the coun­try is threat­ened with a down­grade.

Min­is­ter of Pub­lic En­ter­prises Pravin Gord­han is stag­ing a heroic bat­tle against chron­i­cally cor­rupt and cred­itheavy paras­tatals. He’s knee-deep in the clean-up, but if you look at pol­icy po­si­tions emerg­ing from the depart­ment and the party, there’s still a be­lief that state-owned en­ter­prises can drive growth. Paras­tatals are a huge li­a­bil­ity for the fis­cus and so Gord­han’s view that they can still be growth driv­ers ex­erts wider pol­icy-set­ting in­flu­ence.

As Min­is­ter of Eco­nomic Devel­op­ment, Ebrahim Pa­tel is shep­herd­ing a Com­pe­ti­tion Amend­ment Bill through Par­lia­ment that is in­tended to open up a highly con­cen­trated econ­omy. But if it’s not well-sched­uled with other pol­icy shifts, it can add to an un­cer­tain pol­icy en­vi­ron­ment.

As chair­per­son of the ANC and the min­is­ter of Min­eral Re­sources, Gwede Man­tashe also has eco­nomic pol­icy and po­lit­i­cal in­flu­ence. He has missed the dead­line set by Ramaphosa for the safe pas­sage of a re­vised Min­ing Char­ter, and last month waded into the land de­bate by set­ting an ar­bi­trary max­i­mum farm size of 12 000 hectares as the limit for pri­vate own­er­ship. You could al­most hear prop­erty prices tum­ble af­ter he spoke. Mean­while, min­ing is again in the dol­drums.

By my count, the ANC alone has six politi­cians mak­ing dif­fer­ent eco­nomic pol­icy sig­nals. Add the in­flu­ence of EFF leader Julius Malema and it makes seven.

It’s no se­cret that Ramaphosa was re­spond­ing to Malema when he made the shocker of an an­nounce­ment on land ex­pro­pri­a­tion with­out com­pen­sa­tion at two min­utes to mid­night on July 31.

While some say the jury’s still out on whether that tipped the coun­try into re­ces­sion last week, it’s now clear that Ramaphosa is in­flu­enced by the young rad­i­cal’s soap­box, which makes Malema’s SA’s sev­enth de facto Fi­nance min­is­ter. As the Mil­len­ni­als say: issa too much! — Fin24.

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