Government's policies aligned to radical economic transformation

Thursday, May 11, 2017

Cape Town – Economic Development Minister Ebrahim Patel says government has implemented policies and measures that promote radical economic transformation.

The Minister said this when he, along with Ministers in the Economic Cluster, answered oral questions in the National Assembly on Wednesday.

He said “radical”, in the context of economic transformation, refers to ensuring that transformation is bold, extensive, implemented expeditiously and benefit the widest number of people.

“At an operational level, our department has implemented and supported policies and measures to promote bold and inclusive economic growth, which includes addressing the transformation of ownership, management, staffing and minimum wages in the economy,” said Minister Patel.

He said initiatives such as the Black Industrialists Programme and the support mechanisms put in place by government for new enterprises and entrepreneurs showed government’s commitment to economic transformation.

“All these represent examples of action that is bold, radical and transformative, and that lays the basis for inclusive growth.”

In his State of the Nation Address in February, President Jacob Zuma said government will in the time ahead usher in radical economic transformation by using levers of the State to change colonial and apartheid structural ownership patterns to benefit the majority of the South African population.

On Wednesday, Minister Patel said government’s economic transformation agenda is about ensuring growth that directly, sustainably and expeditiously addresses the high levels of poverty, inequality and unemployment in South Africa.

He said to achieve this, the country needs faster, inclusive and jobs-rich growth so the economy can generate the resources to meet these challenges.

“Our work on economic transformation includes two key components. The first is structural, to grow the size and resilience of the economy, including through promoting entrepreneurship on scale, increasing the level of domestic and foreign investment in the economy, promoting beneficiation of raw materials to finished goods to break the colonial legacy, strengthening economic links with the rest of the continent and promoting higher levels of industrial innovation.

“The second component is to include the participation of black South Africans in the economy, including through increased equity by black investors in the economy, worker participation in the company boards and as shareholders in the firms concerned; job creation that can draw in and employ a large number of persons; promotion of small businesses, township and rural enterprises and improvement in skills, wages and productivity of workers,” he said.

Minister Patel said the recent ratings downgrade by ratings agencies Fitch and Standard and Poor’s was bad news to efforts of growing the economy at a faster and more inclusive level. He said government needs to take steps to ensure that the country regains investment grade status from lenders and pursue a credible, bold inclusive strategy in the interest of all South Africans.  

“The high level of wealth and economic concentration comes at a price to the economy. To build more inclusive ownership and participation levels, we have to address a number of issues. Firstly, corporate misbehaviour through cartels, price fixing and market allocation that deter and inhibit new entrants from securing space in the economy [must be addressed]. Secondly, corruption in the public sector that diverts resources from our people and from urgent backlogs.” – SAnews.gov.za

Most Read