Ramaphosa backs Mboweni’s re­newal plan

Business Day - - FRONT PAGE - Bekezela Phakathi Par­lia­men­tary Writer

Pres­i­dent Cyril Ramaphosa has thrown his weight be­hind fi­nance min­is­ter Tito Mboweni’s con­tentious eco­nomic growth strat­egy doc­u­ment, putting him on a col­li­sion course with his main back­ers from the left.

De­liv­er­ing his open­ing re­marks at the first meet­ing of the pres­i­den­tial eco­nomic ad­vi­sory coun­cil at Tuyn­huys in Cape Town on Wed­nes­day, Ramaphosa said if im­ple­mented, the re­forms would go a long way to re­store con­fi­dence and cred­i­bil­ity. The pro­posed ini­tia­tives would pro­vide hope that av­er­age eco­nomic growth could be lifted.

The pres­i­dent ap­pointed the 18-mem­ber coun­cil for a three­year term with ef­fect from Oc­to­ber 2019. The non­statu­tory and in­de­pen­dent body, chaired by the pres­i­dent, brings to­gether prom­i­nent econ­o­mists and tech­ni­cal ex­perts drawn from academia, the pri­vate sec­tor, labour, com­mu­ni­ties, think-tanks and other con­stituen­cies, to ad­vise him and the gov­ern­ment.

“Much work is be­ing done to im­prove con­fi­dence and re­gain cred­i­bil­ity and trust by im­ple­ment­ing those re­forms that al­ready en­joy sup­port and have been un­der dis­cus­sion for some time,” Ramaphosa said.

Some of the con­tro­ver­sial ideas in the doc­u­ment, which was re­leased in Au­gust, in­clude the pri­vati­sa­tion of state-owned enterprise­s that do not serve a de­vel­op­men­tal pur­pose, and the sale of some of Eskom’s coal­fired power sta­tions.

The ANC’s al­liance part­ners, the SACP and trade union fed­er­a­tion Cosatu, who were largely re­spon­si­ble for Ramaphosa’s elec­tion to head the gov­ern­ing party and the gov­ern­ment, are op­posed to some of the pro­posed re­forms. They are also con­cerned about the lack of con­sul­ta­tion and the pro­cesses fol­lowed ahead of its re­lease.

Cosatu dis­agrees strongly with a num­ber of the pol­icy rec­om­men­da­tions, such as ex­emp­tion for small- and medium-sized enterprise­s from the na­tional min­i­mum wage and the pri­vati­sa­tion of Eskom power sta­tions. The di­vi­sions are said to be frus­trat­ing ef­forts to boost SA’s ail­ing econ­omy.

Sev­eral ob­servers have pointed out that SA has ar­guably some of the best eco­nomic poli­cies in the world but fails when it comes to im­ple­ment­ing them, which has put off in­vestors and ham­pered growth and em­ploy­ment-cre­ation ini­tia­tives.

Growth in the South African econ­omy, mainly driven by the ser­vices, man­u­fac­tur­ing and min­ing sec­tors, has been slow since 2011, when it recorded 3.3%. Since then, it has gen­er­ally been trend­ing down­wards, fall­ing be­low 2% from 2014.

Ramaphosa said var­i­ous re­forms meant to kick-start the econ­omy had al­ready been im­ple­mented. “Our work to­wards an ef­fec­tive visa regime for tourism and high-skill im­mi­gra­tion is un­der way. For

ex­am­ple, the min­is­ter of home af­fairs has abol­ished the re­quire­ment that chil­dren en­ter­ing SA should present unabridged birth cer­tifi­cates.”

Visa waivers have been ex­tended to vis­i­tors from sev­eral coun­tries, re­quire­ments have been sim­pli­fied for coun­tries such as China and In­dia, and an e-visa sys­tem will be pi­loted from No­vem­ber.

Ramaphosa em­pha­sised that the In­te­grated Re­source Plan, deal­ing with SA’s en­ergy strat­egy and pol­icy, was un­der dis­cus­sion by cabi­net and will soon be re­leased. “This is a very im­por­tant ex­er­cise, be­cause it con­sol­i­dates all the work by Eskom’s board and man­age­ment, gov­ern­ment de­part­ments and the var­i­ous task teams ad­vis­ing gov­ern­ment to turn around our elec­tric­ity en­tity and to re­form en­ergy mar­kets.”

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