Motlanthe expresses hope for SA's economic resilience

Sunday, February 8, 2009

Parliament - Despite the global economic meltdown that has ruined developed economies and led many of the world's economies into recession, South Africa can mitigate the effects, President Kgalema Motlanthe said, Friday.

Delivering his first State of the Nation Address (SONA) to a packed and brimming joint-sitting of the National Assembly, Mr Motlanthe highlighted the fact that South Africa's economy, unlike most of the world's developed economies, will contract but still grow in 2009.

"...the regulatory environment in our country and the counter-cyclical budget policies we adopted have helped us avoid the worst impact of the crisis.

"We know too that South Africa is less severely affected than many other countries. Indeed, in a period in which others are experiencing or projecting recessions, South Africa and the rest of the continent are still poised for growth, even if it is at a slow rate," Mr Motlanthe said.

Besides a number of interventions being considered by the Presidency for various sectors facing meltdown or massive retrenchments, South Africa's hosting of the 2009 and 2010 FIFA football tournaments will provide, at minimum, a temporary boost to capital inflows and domestic economic growth.

Industries such as transport and tourism, including the second economy or the informal sector will benefit directly from the massive influx of tourists destined for South Africa's shores.

Tourism is likely to be the greatest recipient of 2010 FIFA World Cup spin-offs and even though the tournament only spans a month, much business will come in the form of return tourists after the wrap up of the World Cup.

The president highlighted that the country is in a position to take advantage of the unique opportunities presented by the two sporting tournaments and that preparations and plans are completed or nearing their end point.

Mr Motlanthe, adding a bit of jest to the ceremony joked that South Africa's national soccer team, Bafana Bafana, are on a winning streak having won their last five games and that they will perform above public expectations.

"But beyond this, the true legacy of this spectacle will be in our ability to showcase South African and African hospitality and humanity - to change once and for all perceptions of our country and our continent among peoples of the world," the president said.

Raised by the president as a critical issue for government to deal with was crime and corruption, with the President saying government has made the fight against the two evils a core area of focus.

This is reflected, he said, in legislation, regulations and rules governing public servants and political office-bearers.

The systems of preventing and punishing corruption may still be inadequate, he said, but government as well as the public can draw solace from the fact that over 70 percent of cases of corruption reported in the media were detected by government.

"The same challenges confront the private sector. In the end, the challenge is as much about regulation as it is about consistent enforcement," he said.

Although crime statistics are coming down, it is the shift of crime from businesses to homes that has led to a perception that crime has increased in South Africa, and the daily experience in poor and affluent neighbourhoods alike, is the possibility of violent attack, the president explained.

The reduction in crime has not been fast enough and incidents of crime, particularly against women, children and the elderly, remain of grave concern.

The criminal justice system, which has been the route of much frustration for victims of crime due to massive case backlogs, still enjoys greater legitimacy than ever before in South Africa's history, the president said.

Mr Motlanthe alluded to service delivery in South Africa, highlighting that much more needs to be done to improve the public's perception of the service culture of public servants.

Referring to a growing inequality gap between rich and poor in the country, as was highlighted in the Presidency's "Towards a 15 Year Review", the president said: "Government is painfully aware that abject poverty is still too widespread in our society; and the level of inequality is too high.

"We have in the past 15 years done our best to attack this scourge through the social wage," he said.

Access to social grants in South Africa has increased from 2.5 million in 1999 to 12.4 million in 2008.

The president, who turns 60 this year, also announced to the nation the fact that the eligibility age for pensioners was being dropped from 63 to 60 years of age this year.

Be it in terms of the country's education system, health care, housing or water and sanitation, the central challenge facing government is how to improve the quality of these basic yet vital services every day.

The enthusiasm, resilience and hope of the South African people and their government will form the foundation of action going forward, he said, adding he is confident the country is in a good state of affairs.

The president also confirmed, he will be announcing the much-awaited 2009 general election date within the next week.