In the usual wide-ranging State of the Nation Address (SONA) President Cyril Ramaphosa emphasised the extent to which South Africa is now at a turning point and needs to capitalise on recent positive developments to build a much bigger, stronger and better economy.
In commenting on the SONA of 12 February, Prof. Raymond Parsons, economist from the North-West University (NWU) Business School, points out that the SONA outlined several of the factors that are now needed to generate the higher inclusive job-rich growth required for South Africa to meet its pressing socioeconomic challenges.
He says these include the immediate imperatives of successfully combating violence and crime and additional steps to ensure water security, as well as several other key supportive infrastructural and policy measures.
“In particular, SONA broadly recognised how essential it now is to make South Africa a preferred investment destination by creating a policy environment and growth outlook in which a sufficient number of firms will feel justified in making fresh plans for expansion.”
Prof. Parsons says the SONA proposals therefore range from further necessary assistance to SMMEs to dealing with the uncertainty around the unbundling of Eskom. “The Eskom situation stresses why growth-friendly reforms must be seen as irreversible if investor confidence is to be retained. It is also necessary to expedite the intended upgrading of public-private sector partnerships to enlarge the capacity for effective delivery.”
According to Prof. Parsons, the outcome of the SONA ultimately depends on a pivot in the commitment to expedite implementation of what is planned, as well as what the Budget on 25 February is able to finance safely.
“Realistic timelines also need to be enforced. Implementation, in collaboration with the private sector, remains the name of the game. The SONA itself referred to a unique ‘window of opportunity’ to now build on better economic news and to translate it into tangible improvements in citizens’ livelihoods on the ground.”
Prof. Parsons says this injects urgency into the implementation of the half-forged policies and projects that must now make a big difference to South Africa’s future economic performance, if the gross domestic product growth target of the Government of National Unity of 3,5% by 2030 is to be reached.
