David Maynier MP

DA Shadow Minister of Finance,

“The Growing Economic Crisis in South Africa”,

Parliament,

18 August 2015

“President Zuma has a job. That’s why you don’t have a job.”

1. Introduction

We too easily forget that millions of people suffer every day in South Africa.

They suffer because they do not have food, and because they do not have shelter, and because they feel unsafe.

And they do not have food, and they do not have shelter, and they feel unsafe, because they do not have jobs.

And because they do not have jobs, they have no dignity, they have no independence, and they have no freedom.

This is the reality for millions of people who suffer every day in South Africa.

2. “Jobs Crisis”

And yet President Jacob Zuma tells us that it is not all “doom and gloom”.

Well, that is not what the Minister of Finance, Nhlanhla Nene, was thinking when he warned that low levels of economic growth and high levels of unemployment are the “new normal”.

The fact is:

- the economy is stuck in a low growth path and is forecast to grow at rates well below the 5.4 percent per year, every year, envisaged in the National Development Plan;

- foreign direct investment is declining and inflation is rising;

- the national debt has spiraled from R500 billion in 2008 to R1.6 trillion in 2015, and is expected to rise to R2.2 trillion in 2017;

- the large current account deficit makes us vulnerable and an honorary member of the “fragile five”, and now the “troubled ten”; and

- 7.6 million people, who would like a job, but cannot find a job, or would like a job, but have given up looking for a job, are unemployed.

What this means, in the end, is that 7.6 million people, many of them young people, live without dignity, live without independence and live without freedom in South Africa.

3. Update

Panicking, President Zuma called a press conference last week to provide an “update” on the work done since the State of the Nation Address on 12 February 2015.

This was a perfect opportunity for him to take concrete action to reverse his economic policy, which is killing investment, economic growth and jobs.

But, instead he focused on process, rather than outcome, announcing the formation of, you guessed it, new inter-ministerial committees, task teams and working groups.

He could have, simply, announced, there-and-then, that the new visa regulations would be scrapped, or the labour laws would be relaxed, which would actually boost economic growth and create jobs.

But, he did not.

4. Policy Uncertainty

And, why is this?

Because, the “root cause” of the economic problem is the political problem.

What we need is clear policy focused on growing the economy and creating jobs. 

But, what we have is policy uncertainly caused by deep divisions within – and between - the ANC, SACP and Cosatu.

President Zuma tells us that the National Development Plan is the policy of government.

But, Deputy Minister of Public Works, Jeremy Cronin, tells us the National Development Plan is “more of a vision”.

And, now the ANC tells us the National Development Plan “is a living document not cast in stone.”

We have Minister for Economic Development Ebrahim Patel saying: Create jobs by “fixing the drains”. 

But, then have Minister of Finance Nhlanhla Nene saying: We don’t have money to “fix the drains”.

What this illustrates is that the biggest “binding constraint” on the economy is politics, rather than economics.

And unless we get the politics right, we will never get the economics right.

5. Conclusion

That is why more-and-more young people, who want jobs but cannot find jobs, understand that:

- you can have high rates of economic growth, or you can have an ANC government, but you cannot have both; and

- you can have low levels of unemployment, or you can have an ANC government, but you cannot have both.

And, that is why more-and-more young people, who want jobs but cannot find jobs, understand that:

- they don’t have a job because President Zuma does have a job; and

- that as long as President Zuma has a job, they won’t have a job.

And, that is why more-and-more young people, who want jobs but cannot find jobs, are choosing to vote for “freedom, fairness and opportunity” in South Africa.