Transforming the economy critical for Ramaphosa's dream team
President Cyril Ramaphosa told Parliament that his investment envoys are on top of their game in notifying investors about potential policy changes, as they go on their charm offensive to attract $100-billion in investment.
Replying to questions from MPs in the National Assembly, Ramaphosa said his investment dream team will spread the message that South Africa is not only open for business, but that it will prioritise inclusive growth and transformation of the economy.
In April Ramaphosa appointed special envoys on investment, including former minister of finance Trevor Manuel, former deputy minister of finance Mcebisi Jonas, former Standard Bank CEO Jacko Maree and former Afropulse executive chair Phumzile Langeni, with economist Trudi Makhaya as his special economic adviser.
Ramaphosa said this would also serve as part of an ambitious investment drive in preparation for a conference that will take place later this year. He said the economy is being well managed, and the rand is strengthening as South African bonds are the best performing among developing economies.
“We were a bit more ambitious when I addressed this house seeking to hold the conference in three months. We found that we had short changed processes and that this conference will have to take place a little later in the year,” said Ramaphosa.
He said investors are still attracted to South Africa because of improving investor sentiment. Initiatives to improve the country’s readiness to grow include a social compact between business and labour, and a jobs summit on faster job creation.
Economic Freedom Fighters chief whip Floyd Shivambu challenged Ramaphosa’s reassurances, saying that holding conferences is not the same as developing a solid plan and implementing it.
He asked the president if he would support the EFF’s efforts to develop amendments to the Banks Act of 1990 to allow for a “state-owned vehicle” aimed at drawing investment.
“You are not clear on the direction we should take. We asked you to set up a state-owned vehicle to draw investment, but you have appointed envoys.
“We have gazetted a process to amend the Banks Act to allow for this vehicle. Do you support this?” Shivambu asked.
Ramaphosa said his investment envoys won’t work outside the parameters of existing laws. They will work with departments and appoint people with the right networks to assist in attracting investment, he said.
State bank issue
“The state bank is a governing party resolution. That resolution may very well result in the amendment to the Banks Act, and that would be something we support. But there also need to be more banks to support the economic development in our country,” he said.
Ramaphosa told Shivambu that there is a need for more diverse financial service institutions “like a stokvel bank … an agricultural support bank… a funeral cover benefit fund banking and township banks”.
“We need to move away from the monopoly of just banks and create more banks so that there is more access to funding,” said the president.
Many countries have various categories of banks to make financial services more accessible to all sectors of the economy and society. Banking must be transformed as the sector in SA is already world class and well regulated.
Inkatha Freedom Party MP Jan Esterhuizen asked Ramaphosa how the land debate affects policy certainty, to which Ramaphosa replied: “The envoys will tell the investment world that South Africa is open for business and that policy coherence and stability is becoming more entrenched in SA.
“Investors receive this message very well. They see it unfolding and happening.” — Fin 24