It signals a continuation of the positive reforms that were started in the previous administration, says Business Leadership South Africa.
BUSINESS Leadership South Africa (BLSA) has commended President Cyril Ramaphosa on his first Opening of Parliament address following the formation of the Government of National Unity (GNU), saying it signalled a continuation of the positive reforms that were started in the previous administration.
BLSA CEO Busisiwe Mavuso said, “His message of unity and working together to solve South Africa’s pressing challenges is well received and we look forward to working with government leaders to achieve this.”
Ramaphosa said the election made it clear that political parties needed to unite, co-operate and form a partnership to solve the triple challenges of poverty, inequality and unemployment – which it has achieved through the formation of the GNU.
“We support the approach of collaboration, as the business sector – through BLSA – has been working closely with government to solve these challenges with a similar approach,” said Mavuso.
Ramaphosa confirmed that a Medium-Term Development Plan was still being developed to guide the administration’s focus areas over the next five years, meaning this address did not contain government’s complete forward-looking vision of the GNU-led government.
“He highlighted a minimum strategic plan that has been agreed upon within the cabinet,” said Mavuso. “The address highlighted government’s intention of prioritising and focusing on key reforms already under way, with added attention being paid to local government. We look forward to the development of an updated plan to unlock further opportunities that will better respond to our country’s various crises.”
The Seventh Administration will focus on three priority areas: first on inclusive growth and job creation, second to reduce poverty and tackle the high cost of living and third to build a capable, ethical and developmental state.
“These priority areas will enable the GNU to focus on their common goals and should ensure the various political parties can work together to achieve these broad objectives,” said Mavuso.
The president said that government would continue to pursue a macroeconomic policy that supports growth and development, in a stable and sustainable manner. The focus on managing public finances to stabilise debt was welcomed by BLSA.
“Reducing the cost of servicing debt is vital to ensure the economy is stabilised and attracts foreign direct investment,” it said.
“We agree that an integrated and comprehensive poverty alleviation strategy is required. The president said the cost-of-living increases are of concern and as such government will aim to expand VAT exemptions and will review the fuel price formula to find areas to reduce prices. This approach will be an important way to alleviate poverty and spark economic growth.”
BLSA noted the new centralised ownership model for state-owned entities to improve accountability, transparency, governance and oversight, and reduce inefficiency and corruption.
“This process requires important oversight to implement the strategy to ensure Ramaphosa’s intentions are correctly realised,” said Mavuso.
SMALL BUSINESS
The president’s comments on the importance of the SME sector were welcomed. “Small businesses are the economic drivers of our nation – if they succeed, our country succeeds. It is for this reason that comments made by President Ramaphosa … should be welcomed, ”said SME services provider Lula.
While delivering his speech to mark the Opening of Parliament, Ramaphosa said that his government was “… convinced that small businesses and the informal sector hold the greatest potential for inclusive growth and job creation. We will pay particular attention to supporting small- and medium-sized enterprises in townships and rural areas. We will take economic activity to where most of our people live so that more jobs can be created.”
Lula’s chief risk officer, Garth Rossiter, said the organisation was happy to hear his instruction that undue regulatory burdens should be removed.
“In the past, these SMEs have had to battle with load shedding, high interest rates, and a generally weak economy. If President Ramaphosa’s comments tonight translate into the kind of real positive support for small and medium enterprises then we truly have something to welcome and celebrate,” he says. “And if we see the Reserve Bank cutting interest rates in the second half of the year as we anticipate, then that is even better for small businesses and economic growth.”
RENEWABLE ENERGY
The South African Photovoltaic Industry Association (Sapvia) said Ramaphosa’s speech acknowledged the great strides that had been made by the renewable energy sector in South Africa.
Sapvia CEO Dr Rethabile Melamu said, “Our own research has shown the enormous potential for job creation that is located in the solar PV space in South Africa and we, therefore, agree wholeheartedly with the President when he refers to the renewable energy revolution that is expected to be ‘… the most significant driver of growth and job creation in the next decade and beyond.”
For this potential to be realised, Melamu said, however, there was an urgent need to invest in the national transmission network to increase connection capacity in high renewable potential areas she adds.
“Just this week we attended the launch of the largest wheeling project in South Africa located just outside Lichtenburg. Sola and Tronox developed the project here in part because the Northern Cape province no longer has any grid capacity available. By investing in the grid network, we will better realise the true potential benefit that solar PV and other renewable energy sources can bring to the people of South Africa,” said Melamu,
“We echo the President’s sentiments on creating a green manufacturing sector and we stand ready to work with his administration in this regard.”
AGRICULTURE
TLU SA, an agricultural organisation, said it was cautiously optimistic about the future of the country following Ramaphosa’s speech.
It said it was encouraging to hear about the planned focus on infrastructure and economic growth. However, it was essential to acknowledge that the government first fix what has been destroyed over the past 30 years.
“The biggest challenge remains the execution of these announcements,” said Bennie van Zyl, the general manager of TLU SA. “Cadres have proven they are incapable of doing so. The focus must now be on expert appointments.”
– BUSINESS REPORT
