Zuma reveals his economic plan to heavy criticism

NEWS ANALYSIS

President Jacob Zuma has once again come under heavy criticism over how his government plans to grow the economy from a sluggish 1.5% to at least 3% in the next three years.

The 3% economic growth is a downward revision from the 5% the ANC-government had committed to achieve by 2019.

In his State of the Economy address at the Union Buildings in Pretoria on Wednesday, Zuma said the economy would grow by 3% through a focus on inward growth opportunities. He said the government would unlock nine opportunities, including revitalising the agricultural sector, mineral beneficiation, the creation of black industrialists, increased focus on small business potential, the ocean economy and resolving problems in the energy sector – something government officials call the Nine Point Plan.

But this plan is not new and the problem is that critics say it does not seem to be working.


‘Not confronting critical issues’
In an interview with the Mail & Guardian on Wednesday, University of Witwatersrand dean of commerce, law and management, Professor Imraan Valodia, said the government’s plans were nothing new.

“There’re always opportunities to find ways to accelerate growth, but we have heard this argument before. There are growth opportunities in the ocean economy. There are growth opportunities in small businesses. But we are not confronting critical issues,” said Valodia.

He said the state should focus on improving public infrastructure. To do this, it needs to improve the governance of state-owned enterprises, especially as they are critical to growth, being strategic sectors.

Valodia said the state could talk about scaling up private-sector investment, but there were a number of serious problems on the political front that would have a big impact on investor confidence.

“I don’t take great comfort in what the president said. There are severe bottlenecks in our infrastructure, energy, transport and all aspects of our social environment,” said Valodia.

Deep state of denial 
Michael Cardo, Democratic Alliance spokesperson for economic development, told the M&G on Wednesday that Zuma was a man in a deep state of denial about the economic mess into which he and his government had dragged South Africa.

He said Zuma’s solution to look inwards for growth opportunities was problematic in that government puts too much power in the hands of an increasingly parasitic and incompetent state.

“They don’t tackle the real issue, which is to free up the private sector to get on with growing the economy and creating jobs. The idea that you can ‘create’ industrialists is just a statist flight of fancy. The IPAP [Industrial Policy Action Plan] contradicts the National Development Plan, which Zuma – despite having staked his legacy upon it – has forgotten and abandoned,” said Cardo.

He said the government was correct to focus on the small business sector to boost development and growth, but that the emphasis should be on removing red tape and barriers to market entry, such as onerous regulations. “Instead, the government tinkers with procurement,” he said.

Cardo added that Zuma was deluded about the energy situation in the country. 

“He is about to make things a whole lot worse by embarking on this reckless nuclear deal. His priorities should be to provide policy coherence and certainty, fix the mess at Eskom, deregulate the labour market, scrap the visa regulations that are killing tourism and get serious about empowering small business,” said Cardo.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Related stories

Fix economy: Cut, build, tax

Expert panel presents a range of solutions to the economic crisis that include cost cutting, infrastructure spending and a solidarity levy

How graft arrests came together

Learning from its failure to turn the Schabir Shaik conviction into one for Jacob Zuma, the state is now building an effective system for catching thieves. Khaya Koko, Sabelo Skiti and Paddy Harper take a look behind the scenes at how law enforcement agencies have started creating consequences for the corrupt

How Africa can curb illicit financial flows to strengthen economies post Covid-19

The AfCFTA is set to be implemented at the same time as the globe tackles post-Covid-19 recovery. Deeping continental integration can help to boost economies, particularly if stemming illicit financial flows is prioritised

Infrastructure key to economic recovery — Ramaphosa

The governing party wants localisation at the centre of its infrastructure-led strategy

Richard Calland: South Africa needs a Roosevelt style of leadership

President Cyril Ramaphosa needs to hold ‘fireside chats’ and have more power and institutional muscle around him, writes Richard Calland

This beef smells like manure

What’s that animal sound? Is it a Hawk swooping? A chicken roosting? No, it’s Zuma remembering a beef
Advertising

Subscribers only

SAA bailout raises more questions

As the government continues to grapple with the troubles facing the airline, it would do well to keep on eye on the impending Denel implosion

ANC’s rogue deployees revealed

Despite 6 300 ANC cadres working in government, the party’s integrity committee has done little to deal with its accused members

More top stories

Hawks swoop down with more arrests in R1.4-billion corruption blitz

The spate of arrests for corruption continues apace in Gauteng and the Eastern Cape.

Catholic NGO boss accused of racism and abuse in Sudan

The aid worker allegedly called his security guard a ‘slave’

Agrizzi too ill to be treated at Bara?

The alleged crook’s “health emergency” — if that is what it is — shows up the flaws, either in our health system or in our leadership as a whole

SANDF hid R200m expenditure on ‘Covid’ drug it can’t use

Military health officials are puzzled by the defence department importing a drug that has not been approved for treating coronavirus symptoms from Cuba
Advertising

press releases

Loading latest Press Releases…

The best local and international journalism

handpicked and in your inbox every weekday