SONA promises ring hollow without real commitment to reform and growth – IRR

President Cyril Ramaphosa’s SONA address last night laid out ambitious growth targets for South Africa over the next few years – but without a commitment to real reform and scrapping growth-destroying policies these ambitions will continue to be unmet.

So says the Institute of Race Relations (IRR).

Any commitments to rapid economic growth – the only way to effectively deal with poverty and unemployment – ring hollow while growth-destroying policies remain on the table.

Says Marius Roodt, IRR analyst and writer: “SONA speeches over the last fifteen years or so have been long on promises but the government has been short on delivery. Without real commitment to proper reform this will remain the case.

“And when it gets down to it, the 3% economic growth target identified by the President is not ambitious enough. We must aim for growth of 5% or higher. And that cannot happen in the current policy environment,” says Roodt.

The only way for South Africa to reach its potential and sustainably reduce poverty and unemployment is through rapid economic growth. This will not be possible while the ANC continues to push policies such as NHI and BEE and while the deeply flawed Expropriation Act remains as is.

“It is clear that BEE policies have failed to help those it is targeted at. Unemployment remains high, particularly among black South Africans. In addition, poverty rates have barely budged in the past 15 years, with all South Africans now poorer than they were at the end of the Mbeki administration,” Roodt says.

“Yet the President doubled down on growth-destroying policies last night, such as NHI and the Public Procurement Act, as well as the mooted Transformation Fund.”

Roodt continues: “It is all well and good to talk about reform and the need for economic growth, as the President did, but these words must now be backed up with action. Although there is still some residual goodwill around the formation of the Government of National Unity this won’t last forever and is arguably fading fast. The time to grasp the nettle of reform is now.”

The first step must be scrapping growth-killing policies and unambiguously committing the country to a path of rapid, economic growth. That will be the only way to sustainably deal with the legacy of the past and ensure that South Africa reaches its full potential, Roodt concludes.

Media contact: Marius Roodt Head of Campaigns Tel: 082 779 7035 Email: marius@irr.org.za

Media enquiries: Michael Morris Tel: 066 302 1968 Email: michael@irr.org.za