Cyril needs to stamp his authority to fix economy

26 June 2019 - 12:37
By Richard Calland
President Cyril Ramaphosa.
Image: GCIS President Cyril Ramaphosa.

President Cyril Ramaphosa's third State of the Nation Address (Sona) was longer on statecraft and strategy than his first of the year in February, even if it disappointed some critics with the lack of implementation detail.

Much of the public commentary on these addresses, past and present, is ill-informed and, more importantly, ill-conceived. The Sona should not be a dreary laundry list of everything the government intends to do.

Those looking for an "action plan" will inevitably be disappointed too.

Instead, a good Sona, such as Ramaphosa's latest, will focus on the vision and the strategy. It needs to tell the watching and listening public that the president is in command and he knows what needs to be done.

There remains an increasingly desperate fight-back campaign from former president Jacob Zuma's network and other fellow ultra nationalist travellers. Their current approach is to derail Ramaphosa's reform agenda and sabotage his strategy for attracting new investment in the economy, both domestic and international.

Hence, Ramaphosa had to offer convincing evidence that he is in control. He succeeded in this. And there was a clear narrative.

  • The economy is in real trouble and so is the fiscus

SA needs to act now. So the country needs to focus on the things that matter most. This includes the most productive parts of the economy with the greatest job-creating potential, and an efficient state.

Predictably there were no bright new policy ideas and no sense that Ramaphosa is willing to look at the new ideas on economic policy.

Ramaphosa offered five simple yet bold goals for the next 10 years that cut across the social and economic structural constraints that inhibit SA's potential, and deny so many citizens a decent, dignified existence:

No person will go hungry; the economy will grow at a much faster rate than the population; 2-million more young people will be in employment; schools will have better educational outcomes and every 10-year-old will be able to read for meaning; and violent crime will be halved.

On issues that have served to distract recently, such as the call for nationalisation of the SA Reserve Bank, Ramaphosa could not have been more clear that he is the adult in the room. He confirmed Reserve Bank's constitutional mandate, while deftly nodding to the fact that the minister of finance must consult with the Bank, and vice-versa, to ensure that monetary policy is supportive of economic growth as well as price stability.

  • The energy question

Ramaphosa also spoke clearly about the climate emergency that faces humanity, warning that the extreme weather conditions associated with the warming of the atmosphere threaten our economy, they threaten the lives and the livelihoods of our people and, unless we act now, will threaten our very existence.

However, he did not take the next logical step, which is to conclude that SA's duty is to urgently reduce its own emissions and its own dependence on fossil fuels, especially coal. This suggests that this is not a battle he is yet ready to have.

  • He was less clear on state power utility Eskom:

Ramaphosa failed to provide a clear enough picture on how and when the unbundling process will begin - something the market was desperate to hear.

  • More tests to come:

Ramaphosa will face many more tests of his leadership and power in the days and weeks to come.

On both fronts - the ANC and government - Ramaphosa may now face choices on which no sufficient consensus can be built. And so he may need to take greater risks in executing his reform agenda.

- Calland is associate professor in public law at the University of Cape Town