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Opinionista

There is hope for South Africa’s economy

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Amid caution that it is too early for the country to be over-optimistic, the rise in GDP and economic activity did not happen by itself. The intensive efforts and collaborative interventions of government, the private sector and all social partners ensured the return of the ailing economy to a positive growth trajectory. The country is beginning to see the fruits of the hard work being put towards the economic recovery that aims to address the triple challenges of unemployment, poverty and inequality.

South Africa’s economy has been under pressure before being adversely impacted by the global outbreak of the Coronavirus Disease (COVID-19) pandemic. In his State of the Nation Address in February this year, President Cyril Ramaphosa reminded us that as a nation we remain unwavering in our determination to build a society that is free, equal and at peace.

This means that when all South Africans have hope, we can navigate any tough situation with ease. The President’s augury words preceded a remarkable economic rebound after a difficult year that almost brought the South African economy to its knees.

The recent announcement by Statistics South Africa (Stats SA) that the country’s economy rebounded in the third quarter of 2020 (July-September) is good news that should be welcomed and celebrated by all South Africans. In the midst of a devastating health crisis that has caused socio-economic misery for many people, any indication of economic growth should excite the nation.  

According to Stats SA, all industries recorded an increase in economic activity compared with the second quarter (April-June), with manufacturing, trade and mining leading the charge. Gross domestic product (GDP) grew by an estimated 13, 5% in the third quarter, giving an annualised growth rate of 66, and 1%. This follows the significant slump of 16, 6% in the second quarter, during the most restrictive months of the national lockdown. 

Amid caution that it is too early for the country to be over-optimistic about this growth, the rise in GDP and economic activity did not happen by itself. The intensive efforts and collaborative interventions of government, the private sector and all social partners ensured the return of the ailing economy to a positive growth trajectory. The country is beginning to see the fruits of the hard work being put towards the economic recovery that aims to address the triple challenges of unemployment, poverty and inequality. 

Although many industries are yet to reach levels of production experienced before COVID-19 we must, as a country, underscore the importance of measures being implemented to ensure a resilient economy, even long after the pandemic.

The Economic Reconstruction and Recovery Plan presented by President Ramaphosa in October 2020 forms part of extraordinary measures to restore the economy to inclusive growth. The measures contained in the plan are unprecedented in the history of South Africa and their results will be felt for many years to come.  What makes this plan unique is that its various pillars are anchored on government working together with social partners. 

A few initiatives have been undertaken to reignite the economy. Recently, the Council for Scientific and Industrial Research (CSIR) and Black Umbrellas – a non-profit programme that focuses on promoting entrepreneurship as a desirable economic path – partnered to provide technical and technological support to small black-owned businesses. This initiative will see many small black-owned businesses accessing CSIR-developed technologies, as well as research and development infrastructure, to improve their business endeavors. Another job-intensive project is the Poultry Master Plan being coordinated by the Department of Agriculture, Land Reform and Rural Development.

The Department of Trade, Industry and Competition’s Global Business Services incentive programme, which aims to create employment in South Africa through servicing offshore activities, is also making progress. The Human Sciences Research Council has recruited 1 000 graduates as part of the Presidential Youth Employment Intervention and the Department of Social Development has employed new social workers. 

The Department of Public Works and Infrastructure has also created numerous employment opportunities through its water, energy and waste management programme, as well as the Welisizwe Rural Bridges Programme, which aims to build 400 bridges in the next three years.

The recent Third South Africa Investment Conference resulted in over R110-billion pledges from business, which will also contribute towards growing the economy and creating much-needed jobs. Government remains committed to creating an enabling environment for investment and business growth. 

Other notable economic-growth boosters include the issuing of invitations by the Independent Communications Authority of South Africa for potential applicants for the high-demand spectrum, the unbundling of Eskom into three divisions (Transmission, Distribution and Generation) and the Request for Proposals for the Independent Power Producer Procurement programme. The current project to roll-out broadband seeks to enhance the quality of telecommunications across the country. 

Meanwhile, when President Ramaphosa recently announced the second wave of Covid-19 in the country. This reality did not augur well for a country still struggling to rebuild what was lost in the first wave. Experts agree that fighting this deadly pandemic depends on our individual and collective behaviour, especially during this festive season.

Our responsible behaviour – which includes social distancing, wearing a mask in public, regularly washing our hands with water and soap or using an alcohol-based sanitizer – will guarantee our personal safety and ensure success in our journey towards economic recovery.

Ms Phumla Williams is the Director-General of Government Communications (GCIS)

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  • Wendy Dewberry says:

    It must be noted that this report reflects the status and interests of the neoliberal capitalist regime relying on environmental degradation and externalities that lie at the foot of the poor. This GDP that is supposed to give confidence leaves out the dreadful situation of the unemployed, and more so at this time. For any moral being, hunger and want in our fellow South Africans is, should be, unacceptable. GDP se gat !

  • Zach de Beer says:

    Is this important? What does the author know?

  • Zach de Beer says:

    What get’s me is this paper publishes this type of nonsense.

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