Cape Times

Executives urging rapid reignition of SA economy

- SIPHELELE DLUDLA siphelele.dludla@inl.co.za

STANDARD Bank group chief executive Sim Tshabalala joined a growing number of top South African executives in urging the government to implement reforms to reignite economic growth.

Tshabalala, who heads Africa’s largest bank by assets, said yesterday that the economy could grow above 1 percent if the government were to implement the National Treasury’s economic recovery plan.

“According to the National Treasury’s modelling, if this kind of scenario played out, South Africa might be able to grow about one percentage point faster – taking us from roughly 1 percent to roughly 2 percent by the end of the year,” Tshabalala told the Deloitte Alchemy Africa Outlook 2020 executive conference.

“The political barriers to achieving some of these reforms don’t seem insurmount­able, so I’m mildly optimistic that South Africa might grow a bit faster than predicted in 2020.”

The government has roundly adopted the Treasury’s plan, but Finance Minister Tito Mboweni has expressed frustratio­n at the slow pace of its implementa­tion.

The plan includes a resolution for troubled state-owned companies, and the introducti­on of multi-year multiple entry visas for business people, among others.

It also calls for completing a spectrum auction, holding a new round of procuremen­t for independen­t power; making the regulatory changes needed to allow more self-generation of electricit­y by large firms, and improving the operationa­l performanc­e of Eskom.

But investors are still jittery over policy uncertaint­y in the land reform programme, lack of energy security and the independen­ce of the SA Reserve Bank.

Tshabalala’s sentiment is shared by many business leaders, including Business Unity SA president Sipho Pityana, who this month urged President Cyril Ramaphosa to implement the structural reforms.

Moody’s says that its attitude towards the country’s credit rating rests on Mboweni’s February 26 Budget.

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