President Cyril Ramaphosa. File photo by GCIS
Declaring December 15 a public holiday to mark the Springboks’ record fourth World Cup triumph, President Cyril Ramaphosa on Monday night said the country should draw hope that with similar resolve it can overcome an ongoing economic crisis.
Their victory in the Stade de France on Saturday has “given credence to Madiba’s words that sport unites the nation”, Ramaphosa said in a live televised address ahead of this week’s medium-term budget policy statement (MTBPS).
The public holiday was set for December to avoid interference with matric exams.
Ramaphosa said the Springboks had given South Africa “bragging rights” and revealed much about the country they represent.
“At moments when their cause seemed lost, they fought back and they emerged victorious.
“As a people we have shown before what is possible when we are united, when we try hard and when we refuse to give up,” he said.
“Together, we overcame apartheid, ended centuries of conflict and gave birth to a thriving democracy. Together, we confronted and overcame the deadliest global pandemic in over a century. We are indeed stronger together.”
Ramaphosa then turned to the state of the economy, and said though there was some progress towards recovery after more than a decade of stagnation, South Africa was far from in the clear.
“Our economic challenges are severe.
“We are working to reverse the legacy of the past era of corruption and mismanagement of our state-owned enterprises, which has left us with a persistent energy crisis and an inefficient ports and rail network.
“And we are contending with a range of global and domestic pressures which have set back our economic recovery. And yet, there are clear signs that our efforts are showing results.”
He said electricity supply was improving, jobs were being created, state capture culprits were being brought to justice and efforts were underway to restore the country’s logistics systems to “world class standards”.
“These are reasons for hope.”
The president’s remarks on the economy come two days before Finance Minister Enoch Godongwana will table the MTPS in parliament on Wednesday. With the commodities windfall on the wane, the minister faces a deficit crisis with economists forecasting a shortfall of about 0.3 percent of GDP.
Ramaphosa nodded to the debt-to-GDP ratio, saying government spending has exceeded revenue since 2008 and growth remained too slow to overcome the challenges South Africa faced.
“Load shedding has constrained economic growth. The underperformance of the ports and rail network is affecting our ability to get exports to market.
“As the minister of finance has noted, for every rand that the government collects in revenue, 18 cents go towards servicing our national debt. This means that we are now paying more in interest on our national debt than we are budgeting for the police force.”
The government would therefore recommit to stabilising debt levels and adopting a responsible fiscal policy. Godongwana would map this trajectory on Wednesday, he said.
“Spending on health, education, policing, and other essential services will be protected as far as possible.”
Remarking that the Social Relief of Distress grant introduced in 2020 “has kept millions of people out of poverty”, he said it should be stressed that welfare grants as well as public employment programmes were vital to support the vulnerable.
Since the only solution to unemployment and poverty was faster growth, he said, the government would accelerate the implementation of economic reforms over the next six months, with a focus on turning around local government.
Ramaphosa reiterated that reducing the severity of load-shedding remained the state’s biggest priority. But in addressing both the country’s energy and logistics woes, plans to introduce greater competition did not point to privatisation, he said.
“I want to make it clear that South Africa’s port, rail and electricity infrastructure are strategic national assets, and that they will remain in public ownership.
“However, introducing competition in operations – both in electricity and in logistics – will create greater efficiency and reduce prices in the long term.”