South Africa's bold economic reform initiative, Operation Vulindlela (OV), is gaining momentum as it enters its second phase. Government officials are promoting significant progress in tackling the deep-rooted issues holding back the country’s economy.
The programme focuses on improving key services like electricity, water, transport, and digital communications, essential building blocks for a strong economy.
"We aim to avoid the ongoing political economy debates that often linger in the background and overshadow the fact that real work has to happen,” said Rudi Dicks, Head of the Project Management Office at the Presidency. Rudi, co-leader of OV, recently participated in the PITSO 2025.5 debate, which was hosted by the North-West University (NWU) Business School.
Accomplishments to date
Rudi observed that OV has made significant progress in various sectors. These include:
The energy sector: Over 100 projects are currently progressing through different phases of development, highlighting a combined total of over 10, 000 MW of new electricity generation capacity. The government has eliminated licensing requirements for independent power producers and established the National Transmission Company of South Africa (NTCSA) to separate Eskom’s grid operations.
Water: Over 70 per cent of water use licences are now processed within 90 days, which is a significant improvement on the previous 300 days, effectively cutting red tape for businesses and developers.
Digital Communication: Efforts have been directed towards reducing data costs and increasing internet availability, particularly in underserved, low-income communities.
Exploring New Advances
In May 2025, President Cyril Ramaphosa introduced the second phase of OV, focusing on new areas while building on existing reforms. This new phase will target municipal reform, freight rail modernisation, and improvements to the visa system to attract skilled labour and investment.
Criticism
Despite the reported successes, OV faces significant challenges. Critics argue that, while the programme excels at policy formulation, the challenge lies in translating these policies into tangible economic results.
Investment
Rudi emphasised the urgent need to attract foreign investment, particularly from established partners such as Japan. He noted that Toyota has had a facility in South Africa since the 1950s, employing around 9,000 people, and that it is the company's leading exporter in Africa.
However, Japanese confidence in South Africa's economy has fallen due to policy uncertainty and the effects of state capture.
"We must break free from our ideological confines," argued Rudi, championing practical thinking over strong beliefs. “We must focus on inclusive growth, employment, investment, and identifying where opportunities lie.”
Looking ahead
According to Dicks, students and young professionals entering the job market should consider targeting growth sectors that may not be widely recognised.
“Embracing self-employment opportunities can be a more effective strategy than relying solely on traditional job-seeking methods,” he added.
Broader Overview of OV
OV navigates South Africa's ongoing economic challenges, which are characterised by high unemployment rates, slow growth, and an urgent need for significant infrastructure investment.
According to the government, Operation Vulindlela’s work is aimed at making it cheaper to do business, opening the market to more players, encouraging healthy competition, and creating new opportunities for investment.
Following years of policy uncertainty, the programme represents what some analysts have described as a "significant new statement of purpose" from the government, indicating a move towards important structural reform.
However, South Africa is also facing additional external pressures that could affect investment and trade flows, given the global economic uncertainty resulting from Donald Trump's re-election as US president.
The second phase of the programme is a pivotal moment to build on initial successes and address more complex issues related to municipal governance, housing delivery and labour market changes.
As Dicks concluded the discussion, he remarked: "We must tap into the untapped potential for growth. It is crucial for academia to embrace a fresh perspective on this matter.”
