Economic panel to start work

Ramaphosa names impressive advisers, but economists call for less talk, more action

● President Cyril Ramaphosa has at last delivered on his February 2018 promise to establish a Presidential Economic Advisory Council, appointing an impressive 18-person panel of local and foreign economists to advise the government on developing and implementing growth-boosting policies.

The new council was announced on Friday, a day after the CEOs of some of SA’s largest companies met Ramaphosa to urge him to speed up action to fix the failing economy and to express concern at Eskom’s massive debt and slow pace of restructuring.

Ramaphosa promised that the long-awaited paper on reforming Eskom would go before the cabinet ahead of the medium-term budget statement on October 30, presidency spokesperson Khusela Diko said.

Diko said the president had confirmed the process of evaluating CEO candidates for Eskom had begun, and that the chief restructuring officer had started work at the power utility.

The Eskom paper had originally been promised by mid-September.

The president told business leaders the appointment of the economic advisory council would be followed by the naming of an investment advisory council and stateowned enterprise council in the next few weeks.

But the new council has been greeted with scepticism by some.

“It’s a good strategy but a little late,” said Nazmeera Moolla, head of South African investments at Investec Asset Management.

Intellidex economist Peter Attard Montalto said: “The panel is all well and good, but policy advisory is not the problem or need here; implementation [is].”

International members of the panel, which is due to meet for the first time on October 9, include Mariana Mazzucato, an award-winning University College London professor of innovation; former Tanzanian central bank governor Prof Benno Ndulu; and Harvard University’s Dani Rodrik, who knows SA well and has advised the government in the past.

Among the South Africans are a collection of professors who are leaders in their fields, many of whom have served in, or advised, the government previously — including Wits University’s Mzukisi Qobo and its dean of commerce and law Imraan Valodia; Haroon Bhorat and Alan Hirsch of the University of Cape Town; Tanja Ajam of the University of Stellenbosch; and Fiona Tregenna of the University of Johannesburg. Hirsch and another panel member, Unisa professor Vusi Gumede, served in the Thabo Mbeki presidency as policy advisers.

The presidency said the council, which has been appointed for a three-year term, would advise the president and the government and facilitate “the development and implementation of economic policies that spur inclusive growth”.

Alexander Forbes chief economist Isaah Mhlanga said SA had never been short of good policies but had struggled with implementation. The solution to that problem “does not lie within the realm of an advisory panel, it lies within the political space”, he said.

Econometrix chief economist Azar Jammine said part of the problem was that SA was caught between those who want market-oriented solutions and an anti-privatisation lobby that was calling for more government spending and regulation.

“If the panel is … a means of trying to bring these two disparate views together then maybe it can achieve something,” he said. “But politics cuts right across this.”

Thursday’s meeting between Ramaphosa and business leaders included four of the major banks, a major health insurer, financial services and telecommunications players, and business organisations Business Unity SA and the Black Business Council, officials said.

Nedbank CEO Mike Brown, who attended the meeting, said: “We discussed the progress we have made as well as the economic challenges facing our country and the urgency with which they need to be addressed — and how business could be helpful in this.”

The panel is all well and good, but policy advisory is not the problem