South African President Jacob Zuma’s point out of the country speech will be adopted by Finance Minister Pravin Gordhan’s Price range speech upcoming 7 days on February 22. They symbolize the country’s two main warring political blocs: patronage as opposed to prudence. But soon after the “radical economic transformation” rhetoric was ratcheted up by the president, each adult males may perhaps shortly stumble on a terrain potholed by what a Donald Trump aide approvingly terms “alternative facts”.
Zuma at the very least did consist of a belated definition of what he usually means by radical economic transformation:
elementary improve in the structure, techniques, establishments and styles of ownership, administration and command of the financial system in favour of all South Africans, in particular the very poor, the vast majority of whom are African and feminine.
Specified Zuma’s distortions of fact, though, may well this simply degenerate into a different episode of communicate still left, walk ideal?
Zuma’s hope is for a “Team South Africa” harmony product to emerge. He said:
Our labour market environment is also showing indications of stability, because of to cooperation by social partners.
But staff are angry. The Globe Financial Forum’s 2016-seventeen World Competitiveness Survey rated South Africa’s “cooperation in labour-employee relations” worst any place in the planet for the fourth straight year, with a ranking that proceeds to sink.
The state’s cooperation with big organization, in the meantime, is characterised by severe corruption. Treasury’s procurement officer Kenneth Brown discovered very last November that R233 billion for every year (out of R600 billion in once-a-year procurement) was missing to supplier overcharging.
And very last year PricewaterhouseCooper rated South African corporations as the world’s most engaged in “economic crime” (at 69%, well in advance of the French and Kenyans).
Zuma hopes for a various fact:
Unity in action was also demonstrated once more this 7 days with the summary of the arrangement on the National Minimum Wage and on actions to stabilise labour relations.
But the country’s largest trade union federation, the Congress of South African Trade Unions refused to support the deal until eventually minimum amount doing the job hrs and inflation changes are agreed. Labour also emphasises that the state’s try to impose a ballot prior to strikes will be opposed intensely.
What may well Zuma do to reverse the modern improve in unemployment to much more than 27%?
Govt runs efficient poverty alleviation programmes these as the Expanded Public Operates Programme [which] has given that 2014 developed much more than two million operate chances.
Even if there were being really 2.5 million these “opportunities” from 2014-16, they lasted only a few months and amounted to only a fifth of the focus on set by in the National Advancement Strategy. The operate pays just R84/working day, 50 % the R20/hour agreed as for every the new minimum amount wage. And R20/hour even now leaves a family of 4 beneath the poverty line.
Housing and solutions
Some of the president’s feedback about housing and solutions were being also fantasies.
Government… presented much more than 4 million homes given that 1994 … To date almost seven million homes have been linked to the grid and now have electric power.
In fact, Africa Examine discovered that a few (not 4) million homes were being generated in this period of time, while it pointed out that no official audit has however been carried out. A lot of need rebuilding because of to structural problems.
As for electric power, Zuma argued that:
Eskom’s construct and maintenance programmes helped assure stability and an stop to load-shedding.
He neglected to point out the 14% crash in electric power demand led by mining and smelting firms. Energy cuts ceased soon after the mid-2015 commodity cost crash and the substantial dumping of Chinese steel shuttered mines and smelters.
And genuine, millions of homes were being indeed linked to the electric power grid given that the early nineties, but then how a lot of millions were being also disconnected because of to incapacity to pay out, in particular soon after the 300% cost hike given that 2008? Very last month, 34 municipalities confronted disconnection by point out utility Eskom because of to arrears exceeding R10 billion.
The exact dilemma occurred in 2014 when Zuma bragged that 95% of South Africans had clean h2o entry, however the upcoming working day, the main H2o Department spokesperson admitted it was only sixty five% because of to disconnections and breakdowns.
When it came to h2o this year he avoided that inconvenient fact, and rather Zuma claimed:
Govt is doing the job really hard to assure trustworthy bulk h2o provide in the several regions of the region to support economic expansion although raising entry to vulnerable and rural municipalities.
For much more than a year the countrywide Department of H2o and Sanitation has been heading into individual bankruptcy. Treasury is considering a official administrative takeover and Public Protector Busisiwe Mkhwebane and the law enforcement Special Investigating Unit are conducting enquiries into corruption.
Globe financial system
Zuma was on probably shakiest floor with this prediction:
We will continue to companion with the United States and operate with each other on difficulties of mutual interest these as the comprehensive renewal of the African Progress and Chance Act.
The two-term corrective to this fantasy is Donald Trump.
We effectively avoided credit score rankings downgrades.
Phony, there were being a number of downgrades in 2016. And while very last December, Standard & Poor’s did not push the sovereign ranking all the way to “junk” status, it came incredibly near when reducing the country’s long-term nearby currency ranking on South Africa to “BBB”.
As for the intended “decision to set up the BRICS Rating Agency” by the Brazil-Russia-India-China-South Africa leaders in Goa very last September, Zuma ought to have observed that the dedication was just to “explore the chance of placing up an unbiased BRICS Rating Agency dependent on market-oriented principles”. This could well replicate a 50 %-dozen prior failed tries to set up an alternative ranking agency.
Choice details experience fiscal austerity
A various narrative will enter the theatre, stage ideal, on February 22 when Gordhan provides the finances speech. Specified the adverse stability of forces – the finance minister is fending off assaults from Zuma’s allies, a downgrade by Standard & Poor’s even now looms big, and force is rising from varied leftist teams these as #FeesMustFall, trade unions and services supply protesters – Treasury personnel are barely probably to radically remodel nearly anything.
Zuma’s most sobering thought from the point out of the country address ought to be the very last term here, simply because it is a sentiment that sounds dangerously ultra-leftist – but at the very least not alternative-facty, not like so a lot else of what he claimed in his speech.
Oliver Tambo [president of the ANC from 1967 to 1991] said, ‘It is inconceivable for liberation to have meaning with no a return of the prosperity of the region to the people as a entire. To allow for the current economic forces to retain their pursuits intact is to feed the roots of racial supremacy and exploitation, and does not symbolize even the shadow of liberation.’
Patrick Bond, Professor of Political Overall economy, University of the Witwatersrand
This report was originally printed on The Discussion. Read through the initial report.