INFRASTRUCTURE development, local manufacturing as well as mass employment industries such as construction and tourism are at the heart of the new economic recovery plan being drawn up by government, business and labour.
This was revealed by Tourism Minister Mmamoloko Kubayi-Ngubane during an interview with Inside Politics on the sideliners of the World Tourism Day, which took place on Sunday at Maropeng, Cradle of Humankind in the West Rand.
Kubayi-Ngubane, who’s also the Chairperson of the Inter-Ministerial Committee tasked with drafting the recovery plan, said that the plan will be released after being presented the upcoming Cabinet Lekgotla with an implementation attached.
Kubayi-Ngubane said Cabinet has asked the drafting team to develop an implementation plan with timelines and monitoring and evaluation systems in place.
She said this is to be done over the next two weeks and be prepared for the upcoming Cabinet Lekgotla.
The tourism minister said that at a recent consultation at the National Economic Development and Labour Council (NEDLAC), government, business and labour agreed on key principles to underpin the plan.
These include using Infrastructure development, manufacturing and mass employment as catalysts to spur economic growth.
Infrastructure is viewed as a key pillar to drive economic growth.
In June this year, President Cyril Ramaphosa launched the Sustainable Infrastructure Development Symposium (SIDS) under the leadership of Dr Kgosientsho Ramokgopa.
At the launch of SIDS, the president acknowledged a number of challenges around delivery of infrastructure, most notably the disruption caused by the COVID-19 pandemic and the fact that credit downgrades by all three major credit agencies will make raising funds on the international markets more costly.
Ramaphosa emphasised the need to press ahead with infrastructure delivery.
“To the contrary, the coronavirus pandemic has made infrastructure investment even more compelling, even more important and even more urgent. That is why we have placed infrastructure at the centre of the stimulus our economy needs to achieve a sustainable recovery,” Ramaphosa said.
Ramokgopa recently gazetted R340 billion worth of infrastructure projects, which are at sod turning stage or past the design and conceptual phase.
Before the COVID-19 pandemic, government had committed itself the to developing R700 billion worth of infrastructure over the next seven years.
“The overarching goal of any new economic recovery plan for SA must now be to build confidence and place the economy on a path of investment and job-rich growth post-COVID-19.”
Professor Raymond Parsons of the North West University Business School told Inside Politics: “The policies and projects in any such plan must promote a stable macro-economic environment for investors, workers and consumers in the period ahead.”
A key area of focus for any plan is the need to fix Eskom.
Government is currently trying to fix the utility’s technical and financial challenges by raising tariffs to grow its revenue and address its R450 billion debt, while attempting collect on the R31 billion it is owed by entities including, municipalities.
The South African Communist Party (SACP) argued that “public funds cannot be rescued capital”, suggesting an opposition to the use of pension funds to rescue ailing state-owned companies.
Trade union federation Cosatu, which is a tripartite alliance member with the ANC, has called on Ramaphosa to announce a R1 trillion economic stimulus package.
The federation also called for a review of the lending criteria for the R200bn loan guarantee scheme underwritten by the Reserve Bank and run by the country’s major banks.
Cosatu also called for furthers rate cuts by the South African Reserve Bank (SARB), and an extension of banks’ payment holidays to customers; a mass public employment programme as well as a “Buy Local” consumer education campaign.
South Africa faces dire economic outlook with unemployment of 30% and GDP for the second quarter falling by 51% compared to a year earlier.
(COMPILED BY INSIDE POLITICS STAFF)