Finance Minister Enoch Godongwana says the reconstruction of the country’s economy is dependent on public and private investments in government’s infrastructure projects, backed by structural reforms.
Godongwana was speaking during the National Investment Dialogue held on Thursday.
He suggested that one of the first structural reforms necessary to create an environment conducive for investment is the reform of the electricity supply industry, which he said in his opinion should be “completely overhauled”.
The Minister said the country’s dependence on Eskom’s electricity supply must be cut down.
“What we are grappling with is the instrument that we can use to enable the private sector to invest in public infrastructure. Critical to that conducive environment are the necessary structural reforms that we must implement.
“First among these is the reform of our electricity supply industry. Since 2008 we have spent most of our time trying to fix Eskom, without fixing electricity supply. It is my considered opinion that the electricity supply industry must be completely overhauled and we must reduce our dependency on Eskom,” the Minister said.
Godongwana suggested other reforms necessary for the economy’s recovery are:
- The auctioning of spectrum to networks, which could allow for “cheaper data” to be available to the economy.
- ‘Greening’ the economy.
- An improvement in logistics capacity.
- An improvement in the cost of doing business in South Africa.
The Minister said these reforms would also be critical to facilitating inclusive economic growth in the country.
“At the centre of our country’s Economic Reconstruction and Recovery Plan is the goal of building a new, fast growing and more inclusive economy, propelled by greater levels of public and private sector investment.”
Godongwana said investment is needed in infrastructure development for sectors such as energy, water and sanitation, roads and bridges, and human settlements.
“We are very clear that the challenges of poverty, unemployment and inequality will only be effectively addressed through higher levels of inclusive economic growth. Specifically, our recovery plan calls for the mobilisation of both public and private sector investment to drive an infrastructure-led recovery,” he said. – SAnews.gov.za