Economic Recovery Plan: The key to unlocking SA's growth

Wednesday, November 18, 2020

The Economic Reconstruction and Recovery Plan will serve as South Africa’s roadmap going forward, as it dusts off the debris left by the COVID-19 pandemic, President Cyril Ramaphosa told potential investors at the South Africa Investment Conference.

The President outlined government’s plan to revive the country’s battered economy to investors at the third instalment of the investment conference held under strict COVID-19 protocols on Wednesday in Sandton, Johannesburg.

The annual conference, which aims to attract R1.2 trillion of investment over five years, was held for the first time in a hybrid setting through virtual platforms and limited physical attendance due to COVID-19 regulations.  

To date, the conference has attracted approximately R664 billion in investment commitments from local and international investors.

Highlighting the Economic Reconstruction and Recovery Plan, President Ramaphosa said government was hard at work to ensure that it provides fertile ground for potential investors and spurs economic growth.

The plan’s priorities include a massive infrastructure programme; an employment stimulus to create and support jobs; immediate steps to achieve energy security, and measures to deepen local industrialisation and African integration.

“The private sector is vital to the achievement of these priorities and shifting the economic trajectory of our country.

“This is particularly true of our infrastructure programme, which relies on private investment in new infrastructure projects to create efficient, world-class network infrastructure and boost aggregate demand,” said the President.

Through the Infrastructure Fund, President Ramaphosa said public funds will be used to leverage private investment on a larger scale.

Panel discussions

With the economic recovery plan underpinned by a social compact among government, business and labour, representatives of these sectors participated in a panel discussion with the President.

The Congress of South African Trade Unions (Cosatu) President, Zingiswa Losi, said her sector is interested in seeing investment yielding much-needed jobs.

“The type of investment that we as labour are looking at is an investment that will be looking at key sectors such as renewable energy, the digital economy and manufacturing because what we want to see is an investment that is going to create employment,” said Losi.

From the perspective of business, Business Unity South Africa Vice President, Martin Kingston, agreed with the President that the implementation of the investments was key to unlocking the country’s economic recovery and growth.

“The last two conferences were extremely successful in mobilising investment and of course, we should not be surprised that the level of commitment has stalled as a consequence of the pandemic, so we used that time wisely as social partners.

“We have listened to one another so that we can identify those things that need to be focused on and there is a need for a ruthless focus on implementation, in particular harnessing the resources of all social partners,” said Kingston.

Operation Vulindlela

To drive the delivery of key reforms, government established Operation Vulindlela with a dedicated team from the Presidency and National Treasury.

“‘Vulindlela’ means to ‘open the way’ in isiZulu and isiXhosa. Operation Vulindlela will open the way for high-impact economic reforms in network industries such as energy, water, telecommunications and transport, as well as in attracting critical skills and streamlining the visa regime.

“We will focus on a number of priority reforms with clear timeframes, and make sure they are effectively and swiftly executed. The team reports directly to me on progress in implementation,” said the President.

With this year’s conference focused on consolidating and implementing R664 billion worth of previous investments, the President punted the need to not only focus on implementation but also look to the opportunities available for investors.

“We are positioning South Africa as a leading market for global business services, leveraging our unique strengths in customer service, broadband infrastructure and expert skills.

“We are rebuilding our manufacturing capacity through the establishment of Special Economic Zones and the revitalisation of industrial parks.

“Our mining sector has proved resilient through the worst of the pandemic and is benefiting from renewed demand for our strategic minerals,” said the President.

In addition, President Ramaphosa called on investors to take up the opportunity presented by the pending African Continental Free Trade Area (AfCFTA) - set to take effect in January 2021.

The AfCFTA will establish a continental market of some 1.3 billion people, with a combined GDP in the region of $2.3 trillion dollars.

“With its advanced infrastructure, diverse economy, sophisticated capital markets and developed manufacturing capacity, South Africa is the ideal location for any company wanting to reach the continental market with greater effectiveness from a cost and logistical point of view,” said the President. – SAnews.gov.za

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