Let’s harness improved confidence to drive inclusive growth – President

President Cyril Ramaphosa says government remains committed to collaborating with business, labour unions, and other social partners to advance the structural reforms necessary for fostering inclusive economic growth and creating jobs.

The President said this in his weekly newsletter to the nation on Monday.

“We cannot rebuild our country unless all South Africans work together. We will continue to work with business, labour and other social partners to drive the structural reform process that will boost inclusive economic growth and jobs.

“There is indeed an air of optimism in our country. Let us harness this confidence and goodwill to increase the momentum of our shared efforts to build and strengthen our economy,” the President said.

President Ramaphosa highlighted that over the last few months, the country has seen a growing confidence among investors, business and citizens over the prospects of the economy.

The latest Business Confidence Index published by the South African Chamber of Commerce and Industry (SACCI) points to an increase in business confidence since the elections in May.

The President noted that this sentiment is evident in the Johannesburg Stock Exchange’s All-Share Price Index, which increased by about 8% from the end of May to the end of July 2024. 

“This is welcome news, particularly in light of the most recent employment figures released by Statistics South Africa, which show that unemployment remains extremely high at 33.5%.

“Business confidence is so important to our efforts to create jobs because it signals an improved business environment and encourages new investment. Greater investment in the economy enables faster growth and more job opportunities,” he said. 

For several years, the country has experienced low levels of business confidence, having been negatively affected by the prolonged electricity crisis, State capture, concerns about corruption, the decline of State-owned enterprises and the manner in which law enforcement agencies had been compromised.

President Ramaphosa further reflected that investors have also been concerned about obstacles to growth, such as delays in the release of broadband spectrum, inefficiencies in ports and rail operations, and regulations that have slowed down licensing processes. 

The President lauded the successful holding of the national and provincial elections in May and the formation of the Government of National Unity, both of which have had a positive effect on business confidence.

He said the progress that has been recorded in the reform process thus far has also contributed to the improved sentiment.

Rooting out corruption

To create a conducive environment, the President said government has shown its determination to tackle corruption.

Bodies like the National Prosecuting Authority (NPA), Special Investigating Unit (SIU) and the Hawks have brought several high-profile cases to trial. The permanent establishment of the NPA’s Investigating Directorate has also given further impetus to the fight against corruption.

Crime is also being tackled. Across the country, the President said, initiatives such as Operation Shanela have upped the war on crime.

“We are clamping down on illicit mining operations. Criminal syndicates involved in cable theft and extortion at construction sites are being dealt with. 

“Through a concerted effort from all stakeholders, we have confronted the electricity crisis. We have now had more than 140 consecutive days without load shedding. There has been a huge increase in new power generation capacity. 

“Investors have seen the growth opportunities in the far-reaching energy reforms we are undertaking. Just last week, I signed into law the Electricity Regulation Amendment Act, which will enable the establishment of a competitive electricity market,” the President said.  

The progress made in electricity provision, he said, gives confidence that the country can overcome the problems on the freight rail lines and ports.

Transnet’s recovery plan is showing progress, with the private sector providing significant technical support and resources to Transnet Freight Rail and Port Terminals.

In Gauteng, the Western Cape and KwaZulu-Natal, newly launched state-of-the-art passenger trains are now operating along refurbished and reopened rail corridors, offering commuters faster and more affordable transportation options. 

This development is expected to significantly reduce commuting times and costs for users.

Reforms and investment

Additionally, government has implemented changes to immigration regulations to attract skilled professionals, investment and tourists to South Africa. 

Approval processes for water use licences and energy projects have been expedited, and the release of broadband spectrum aims to unlock the full potential of the telecommunications sector.

These reforms are set to drive economic growth and enhance the country’s global competitiveness. 

The country is also making progress on infrastructure investment. According to Nedbank’s Capital Expenditure Project Listing, the value of fixed investment project announcements in the first half of this year rose to approximately R800 billion.

This was up sharply from just over R190 billion in 2023.

The public sector accounts for most of these projects in areas such as energy, transportation, health facility upgrades, roads and housing. 

“As government, we held a meeting with business leaders last week. Business expressed optimism about the recovery and growth of our economy. They committed themselves to a new era of partnership with government. We agreed on key actions we must now take to build on the progress that has already been made,” the President said. – SAnews.gov.za

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