Cape Town – President Jacob Zuma says while the work of rating agencies has an impact on the global economy, their economic ratings do not impact on agreements signed between South Africa and other countries.
The President said this when he fielded oral questions at the National Council of Provinces in Cape Town on Tuesday.
An MP had asked the President if rating agencies are able to influence bilateral agreements entered into between South Africa and other countries.
“We take the agencies and their work very seriously because it is also another mechanism through which governments take stock of the work they do and ensure continuous improvements in governance.
“While rating agencies are an important feature in the world economy, they do not necessarily impact on agreements between countries,” said President Zuma.
The President said credit rating agencies usually assess the ability of debtors to pay back the money they owe. He said depending on their assessments, agencies then issue credit ratings for sovereign borrowers, such as South Africa’s government.
“Since most countries depend on international investors and [access] to international capital markets, good credit ratings are very important.
“They determine the cost of borrowing money and give an indication to international investors whether to invest in a country or not,” he said.
The President said government approaches economic policy, as well as fiscal policy, in a prudent manner.
He said the State always seeks to ensure that there is macro-economic stability and public finances are sustainable.
“There is no doubt that adhering to this approach has helped preserve South Africa’s credit rating.”
Central coordination improves service delivery
The President said, meanwhile, that central coordination of government work has enabled different spheres of government to deliver on services more efficiently.
He had been asked about the advantages of establishing the Presidential State-owned Enterprises (SOE) Coordinating Council would play to socio-economic transformation.
In 2010, the President commissioned a review of all SOEs through the Presidential Review Committee on SOEs, whose report was accepted by Cabinet in 2013.
President Zuma said among others, the committee recommended that an Inter-Ministerial Committee on SOEs should be established as a precursor to the establishment of the SOE council of Ministers.
In 2015, the President established the Inter-Ministerial Committee (IMC) on SOE reforms, chaired by Deputy President Cyril Ramaphosa.
Addressing MPs, the President said the IMC has recommended the setting up of an SOE council to be chaired by the President.
“The council has not been established yet. This [is] based on the recent successes in coordinating the work of various spheres of government… Our infrastructure programme, which is coordinated through the Presidential ICC, brings together Ministers, Premiers and Mayors. This central coordination brought about by the PICC has improved our work and has enabled quicker consultation and decision-making and more efficient monitoring of progress.
“Government continues to work hard to find solutions to ensure that the SOEs function more efficiently and effectively.”
Progress made on Operation Phakisa
In response to a question on progress made on Operation Phakisa, President Zuma said the grand project has helped government to deliver its programmes faster and more efficiently.
“To date, delivery laboratories have been convened focusing on the ocean economy, creating the ideal clinic in the health sector, promoting the use of information communication technologies in education, enhancing growth in the mining sector, advancing growth in the environmental sector and tourism, as well as advancing growth in agriculture and agro-processing.
“Since its inception in July 2014, the ocean economy component of Operation Phakisa has unlocked R17 billion in both public and private sector investments,” he said.
The components of the Ocean Economy Phakisa are maritime transport and manufacturing; offshore oil and gas exploration; aquaculture and marine protection services and governance; coastal and marine tourism and small harbours development.
With respect to Operation Phakisa in the health sector, a total of 414 primary health care facilities have been transformed into ideal clinics, providing efficient quality health care since implementation commenced in 2015.
“Our target is that by 2019, a total 2 823 primary health care facilities should be ideal,” said President Zuma.
On education, the aim is to make ICT a primary tool of teaching and learning. Since Operation Phakisa in the Basic Education Sector was launched, an additional 2 430 schools have been connected.
Government’s vision is for all 24 000 public schools to be connected to the internet. To date, 54% of schools have been connected.
On the mining front, the report of this component of Operation Phakisa has been finalised and will be made public once approved by Cabinet in the course of this year.
“Government is firmly on course with the implementation of Operation Phakisa and it has introduced a new way of implementing our programmes successfully,” said President Zuma. – SAnews.gov.za
