Response to the State of the Nation Address
10 February 2017
BLSA welcomes the endorsement of the President in his SONA address of the CEO Initiative. This initiative, involving regular meetings between the Government and business leaders played a major role in ensuring economic stability in 2016, preventing a ratings downgrade and putting in place joint initiatives to stimulate the economy and grow jobs.
BLSA is committed to redoubling its efforts in this joint initiative 2017, with the objective of achieving inclusive growth through creating significantly more jobs, access to opportunities in the formal economy for those who are excluded, introducing structural economic reforms and, vitally, stimulating growth.
We applaud the recognition given by the President to further achievements of social dialogue in 2016 in the NEDLAC negotiations on the National Minimum Wage and labour reforms, ably led by the Deputy President. We believe that this process demonstrates the benefit of social dialogue in resolving our most intractable challenges, and we should build on this in 2017.
We were very encouraged to hear that government is committed to signing the IPP contracts and increasing procurement of energy from the private sector. This will stimulate investment and confidence. We believe that a thorough, open and transparent process on the energy future of the country is vital, and are opposed to the pre-emptive initiation of a nuclear procurement process. Plans for our future energy mix need to have the support of all major stakeholders, be focused on making our economy as competitive as possible and growing jobs.
Business has been gravely concerned about the lack of certainty, predictability and an enabling environment in the mining sector. This has unnecessarily weakened this sector of our economy, caused thousands of job losses and stifled investment. We are encouraged by the commitments of the President to finalise the Mining Charter and MPRDA, and hope that this is done through improved consultation and dialogue.
BLSA chairman Jabu Mabuza said “We support the view expressed by the President, in quoting OR Tambo, that political freedom is incomplete without “economic emancipation”. Transformation of the ownership and control of the economy is a moral, political and economic imperative. Equally important is the need to improve the working and living conditions of working class South Africans and the prospects for the 6m South Africans who can’t find a job.”
As pointed out, government and business have begun to make progress on these issues with the formation of the SME Fund, the preparation for the YES campaign and support for the Black industrialists programme. This cooperation needs to be strengthened and deepened. Economic emancipation will not be possible in the context of a hostile relationship between business and government.
As pointed out by the President, economic emancipation will also require making the economy more competitive, less bogged down in red tape and an easier place to do business. The government will need to continue their good work in maintaining fiscal discipline, and we look forward to evidence of this in the Budget Speech of the Minister of Finance on 22 February.
Finally, to achieve economic emancipation is going to require decisive action to improve governance of SOEs, improve co-ordination between the ministries concerned with the economy, and decisive steps to restore credibility to key state institutions such as the Hawks and the NPA.
Like most South Africans, business leaders were distressed by the scenes in and around Parliament during the SONA. Mabuza said “Democracy requires mutual civility and decorum from all parliamentarians. Whilst we welcome the free and contested nature of our democratic politics, which are the hallmarks of a vibrant and constitutional open society, the unnecessary militarisation of the event and the acts of violence, insults and abuse have no place in our democracy.”
Statement issued by BLSA, 10 February 2017
