Analysts say Jacob Zuma should focus his State of the Nation speech on fixing the economy after a damaging labour strike and economic downgrades.
Analysts have urged President Jacob Zuma to arrest the country’s sluggish economic performance by announcing plans to ease anxious investors when he delivers his second 2014 State of the Nation Address (Sona) on Tuesday night. But Zuma will have stiff opposition from the labour union movement if these plans involve limiting the right to strike.
The five-month strike on the platinum mines has been blamed in part for the lower-than-expected first quarter economic growth figures, and the recent economic downgrades by ratings agencies.
Approximately 70 000 platinum mineworkers have been on strike, demanding salaries of R12 5000. On Tuesday, platinum producer Impala Platinum told the South African Press Association that it was hopeful a meeting with the Association of Mineworkers and Construction Union (Amcu) would happen “soon”, to finalise a wage agreement and bring an end to the strike.
“His speech is likely to be aimed sharply at the investor community,” Mzukisi Qobo, a politics lecturer at the University of Pretoria, said in a June 13 phone interview with Bloomberg. “He would want to give them a sense that the government has a grasp of the kind of challenges facing the economy and is committed to doing something about them.”
Last week, the ANC acknowledged that the unresolved strike was hurting the economy.
ANC spokesperson Zizi Kodwa said: “We appreciate the challenges ahead and have made the resolution of the current platinum strike as urgent and a prerequisite for building confidence in the economy.”
But the National Union of Metal Workers of South Africa (Numsa) says it heard “rumours” that Zuma could make announcements on limiting the length of time strikes can go on for before parties have to go to arbitration.
Compulsory interest arbitration
“We will be very, very upset if Zuma makes any announcements that will limit the right to strike,” said Numsa’s parliamentary officer, Woody Arun.
He said the union had heard that the ruling party was flirting with the idea of compulsory interest arbitration – a policy that would force parties to go to arbitration after a certain number of strike days.
“Of course, if he announces good policies, we will welcome that,” Arun said. But on the whole, Numsa was not “hopeful” that Zuma’s speech would result in “good policies”.
This was because the ruling party in Parliament had “back-peddled” on key pieces of legislation, Arun said. He referred to the announcement of a youth wage tax incentive in 2013. The Employment Tax Incentive Act was signed in December 2013, in the face of strong opposition for Cosatu.
“But over the last few weeks we’ve been getting horrific figures on youth unemployment,” Arun said. “So, where are the thousands of young people who were supposed to benefit from that subsidy?”
While the union was sceptical, civil society called on Zuma to announce plans to improve education and health.
This week, the Treatment Action Campaign (TAC) called on Zuma to renew his focus on access to quality health care for all South Africans.
“We cannot afford for President Zuma and his new administration to paper over the serious cracks in both our public and private health care systems,” the TAC said in a statement.
The TAC said Zuma and his administration should be commended for the massive progress made in the fight against HIV and Aids over the past five years. But Zuma needed to set out an “ambitious plan” to rid the health care system of serious problems, which were impeding access to health care.
Equal Education said it wanted Zuma to provide leadership on how problems facing the country’s schools will be prioritised.
This included the norms and standards for school infrastructure, which was enacted last year.
“This law requires that we eradicate mud schools within three years, and that schools without water, electricity, sanitation and safety receive priority treatment,” the organisation said.
“Promises about mud schools have been made in Sonas going back to former president Thabo Mbeki in 2004, but for the first time this is now a legal requirement. We are interested to know what are government plans to make sure they comply with this new law within the set time frames.”
Political analyst, Mzoxolo Mpolase, was optimistic about Sona on Monday, saying Zuma was perfectly placed to take strong action to fix the economy.
Pre-Marikana growth levels
He said Zuma needed to prioritise three areas in order to do so: this was unemployment, economic stability, and finding new areas for economic growth beyond the minerals industry.
He said it would not be sufficient to find ways to take the country back to pre-Marikana growth levels, which were also not ideal. And to stimulate growth, Zuma would have to announce ways to solve South Africa’s energy problems.
“He’s not shown any leadership in that regard. We knew Medupi [Eskom’s new power plant, in construction] wouldn’t be built in time. It could have been online by now had Zuma shown better leadership.”
But if Zuma did not announce ways to stimulate growth on Tuesday night, and instead reflected on the ANC’s “good story to tell”, Mpolase said “economic arbiters” would remain skeptical about the country’s prospects.