'We have to decisively change the face of our economy': Ramaphosa

Andisiwe Makinana Political correspondent
President Cyril Ramaphosa
President Cyril Ramaphosa
Image: GCIS

ANC president Cyril Ramaphosa says the ANC-led government has to decisively change the face of SA's economy, and not simply allow it to return to where it was before the devastating Covid-19 pandemic.

“In other words, our task is not only to build back better, but also to build forward differently. To bring about this change, we need a radical programme of action that is restorative, that rebuilds and that is transformative,” said Ramaphosa.

He was delivering the ANC's annual January 8 address, which was streamed live on TV and on the internet on Friday due to restrictive Covid-19 regulations.

Ramaphosa said the state's focus for this year was on aggressively implementing the Economic Reconstruction and Recovery Plan — a plan for the reconstruction and recovery of SA's economy that is aimed at stimulating equitable and inclusive growth.

He said economic recovery and reconstruction were as important as protecting the health of the nation and that the pandemic has resulted in unprecedented levels of economic contraction and job losses.

“We have to achieve higher levels of economic growth and investment. We have to create jobs and bring more black South Africans, women and youth into the mainstream of economic activity,” he said.

Ramaphosa noted that for millions of South Africans, the poor conditions under which they lived before the pandemic had only got worse.

“The economy has contracted sharply. Around two million jobs have been lost and many more people have fallen below the poverty line,” he said.

Ramaphosa said many families face hunger and hardship as the country enters the new year with many more struggling to keep up debt repayments, have had their assets repossessed and are unable to make ends meet.

He said without the economic and social relief measures that the government put in place, and without the urgent interventions to strengthen our public health-care facilities, the situation could have been far worse.

In the relief phase of the social and economic response to the pandemic, the government put in place a number of emergency economic interventions which included a temporary Covid-19 grant, top-ups to existing social grants and transferring UIF funds to firms and employees in distress.

“We are now in the phase of rebuilding, and our focus is on aggressively implementing the Economic Reconstruction and Recovery Plan.

“At the heart of the plan is mobilising investment, creating new jobs and supporting existing ones, and accelerating industrialisation,” he said.

“We are undertaking large-scale public investment in key sectors such as energy, water and sanitation, roads and bridges, human settlements, health and education, digital infrastructure and public transport,” he added.

Ramaphosa said in these and other infrastructure programmes, the government was also pursuing public-private partnerships and promoting investment in sectors such as agriculture, manufacturing and mining and tourism.

He said they were also providing support to key sectors such as poultry, sugar and automotive, as well as small-scale manufacturers, and township and rural entrepreneurs.

“Our emphasis is on localisation so that SA businesses benefit from all areas of economic activity.”

Ramaphosa said the government has also begun the process of rolling out public employment programmes that will offer greater work opportunities, especially for women, youth, people with disabilities and other marginalised groups.

Turning to energy, Ramaphosa said the country’s energy security remained a priority.

He said the ANC government will in the year ahead focus on building massive new electricity generation and transmission capacity, in the process creating jobs.

“This will include diversifying our energy mix to ensure a significant proportion of new generation comes from renewable sources.

“The easing of regulations for electricity self-generation by firms and municipalities will unlock significant investment and job creation potential,” he said.

He said the recently established presidential climate change commission will support a just transition to a low carbon, climate resilient growth path that will ensure that no-one is left behind.

Ramaphosa also touched on reforms in the telecommunications sector which he said will see the allocation of high demand spectrum which will accelerate the rollout of 5G.

“In the year 2021 we will deepen the social compacting that is so critical to our economic recovery. To this end the ANC is encouraged that there is broad consensus at Nedlac on the actions that are needed to drive SA’s economic reconstruction and recovery,” he said.

Ramaphosa also noted that the success of the economic recovery relies in large measure on the repurposing of state-owned enterprises to more effectively and sustainably fulfil their developmental mandates.

“This means we need to intensify the work already under way to address management and governance challenges, reduce the reliance of many SOEs on the fiscus and overcome resistance to transformation,” he said.

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