Message from the Treasurer General

EXTRACTS FROM AN ADDRESS BY THE TREASURER GENERAL OF THE ANC, PAUL MASHATILE, ON THE OCCASION OF THE CHATHAM HOUSE ONLINE DISCUSSION ON THE OUTLOOK FOR THE SOUTH AFRICAN ECONOMY POST-COVID-19

27 May 2020

 

Warm greetings, to all of you who are watching and listening to this online discussion from different parts of the world.

South Africa, is engaged in a titanic battle against an invisible enemy that is destroying lives and livelihoods: the COVID-19 pandemic.

South Africa’s GDP is expected to contract by 6.4% in 2020, with more than 1.8 million potential job losses. 

The South African government has acted swiftly, boldly and decisively to put measures to curb the spread of the virus and to cushion its economic impact on the poor and vulnerable. 

Government has announced a more than US$ 27 billion social and economic stabilization package, intended to flatten both the curve of the pandemic and the economic downturn. 

This package is equivalent to 10% of South Africa’s GDP. 

In addition, government began implementing measures to stabilise public finances; eliminate wastage, ensure value for money and efficiency of spending.  

We have also acted decisively to promote energy security. This includes implementing a turn-around strategy for our electricity utility, Eskom, as well as initiating a process of generating extra energy capacity; including through renewable energy.

Similarly, we have begun a process of amending the Constitution to provide greater clarity and certainty in the implementation of the land reform programme. 

We reiterate that there will be no land grabs in South Africa! 

After engagement with the private sector, and the multilateral development banks, cabinet will soon approve an infrastructure project pipeline totaling more than US$ 20.5 billion focusing on network industries such as rail and ports, energy, ICT, water, sanitation and human settlements.

Plans are underway to repurpose and restructure state owned enterprises to maximize their developmental impact and improve their commercial viability.

We are continuing with the important task fighting corruption in the public and private sectors. 

It is however clear that given the scale of the damage to our economy, the post COVID-19 reconstruction effort will be no mean feat. 

The COVID-19 pandemic has highlighted that apartheid fault lines are still persistent in our economy and society.

The poor and the vulnerable are the hardest hit by the pandemic.

Accordingly, we in the African National Congress have begun reimagining and planning towards a post COVID-19 South African economy.

We have taken the view that in building a post COVID-19 economy, we need to go back to the fundamental insights contained in the Reconstruction and Development Programme (RDP) of the early 1990’s. 

We are also determined to ensure that the goals of the National Development Plan, Vision 2030 to reduce inequality, poverty and unemployment find practical expression in the new economy we are building.

Government is already in discussion with international partners such as the IMF, the World, the New Development Bank and the African Development Bank to raise US$ 27 billion as part of our immediate health response to the COVID-19 pandemic.

We estimate that South Africa will require more than US$ 100 billion for the post COVID-19 reconstruction to succeed.

As we build the social compact, we are inspired by the tremendous solidarity and compassion that has characterized the South African response to the pandemic. 

To all of you we say; South Africa is open for business!

For us the focus is now implementation.

It is no longer business as usual.

Thank you.

 

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