Transforming South Africa’s Economy Through Enterprise – Andrew Whitfield MP

The below speech by Andrew Whitfield MP during yesterday’s DA-sponsored debate in Parliament:

Chairperson, Honourable Members,

In the 2024 national and provincial elections the people of South Africa sent us a message, loud and clear. That message was that the country was moving in the wrong direction and that it was time for change.

The establishment of the GNU is, therefore, a response to this demand for change and it has been embraced by the majority of South Africans for one reason and one reason alone, and that is the belief that the GNU will deliver growth and jobs for all.

Currently, the country experiences among the highest peacetime levels of unemployment, persistently high levels of inequality as measured by the Gini-coefficient and citizens experiencing decreasing levels of welfare as evidenced by the real GDP per capita in 2023 which was less than in 2007.

This is why the GNU has placed rapid, inclusive growth and job creation as our apex priority supported by the GNU’s Statement of Intent which clearly articulates the need for the transformation of our economy as well as evidence-based policy and decision-making.

Chairperson, the transformation of South Africa’s economy is not one dimensional, also it should not be a controversial issue and neither should evidence. Of course, our economy must transform. No reasonable, rational person could disagree with this statement based on all of the available evidence. Our increasing levels of unemployment and inequality over the past 17 years are simply unsustainable.

In spite of intentions to grow and transform the economy since 2007 the efforts during that period have delivered worse outcomes. That is why we must use the lessons of the past to lead an evidence-based decision making process in order to respond to our economic crisis.

The budget tabled in Parliament this week is further evidence of the need to more urgently drive our growth agenda by adapting policy to transform our economy from static to dynamic and from low growth to high growth.

By embracing the best ideas from within the GNU we can finally transform our economy into a growing economy which unites the outsiders and insiders, strengthens the middle class, unlocks growth opportunities for small and medium-sized enterprises, and sets our country on a sustainable path to prosperity.

This will require a laser-focus on removing barriers to growth that truly unleashes the full potential of enterprising individuals.

The International Monetary Fund recently measured South Africa’s ease of doing business against 49 other countries and we came last. This report read together with the World Bank Report on Inclusive Growth highlight the opportunity for growth in regulatory reform – we cannot ignore the evidence.

Ultimately, it is government’s job to make it easier for businesses to grow and create jobs, and for people to get jobs and keep those jobs. To do this we acknowledge that South Africa cannot rely on government-run initiatives alone to transform our economy. We must foster an environment where businesses can thrive and become engines of job creation and economic prosperity.

It is for this reason that the GNU must champion urgent regulatory reform to compliment progress on structural reforms. The Medium Term Development Plan has set ambitious targets to cut red tape but this will require an independent regulatory impact assessment and thereafter the courage to swiftly implement the recommendations.

At the same time, it is important to acknowledge that such an assessment and the implementation of its recommendations should not be seen as a silver bullet to our ailing economy, but rather a critical element to compliment the structural reforms currently underway. Beyond regulatory and structural reform towards an inclusive economy, there is a need to review the effectiveness of the master plan model as advised by the Trade and Industrial Policy Strategies (TIPS). Work is currently underway to assess the Special Economic Zone model to ensure greater impact and the MTDP has set a target to conduct a government wide review of incentives to ensure a more efficient allocation of resources.

With regards to the World Bank report which highlights a number of key interventions to create an inclusive economy, it is important to point out that the proposed potential drivers for inclusive growth, including the proposed roadmap are a product of engagements between the World Bank and key domestic interlocutors in both government and the private sector. This indicates alignment across many of the recommendations which bodes well for implementation.

We must urgently moving beyond government-led transformation to a model of empowered enterprise, driving job creation if we are to move the needle on inclusive growth . Ultimately, an inclusive economy requires inclusive policies which enable growth that will expand economic opportunities for all.

The GNU must respond with urgency if we are to deliver on the mission of jobs and growth for all – we are running out of time.