Feb 12, 2021 SONA South Africa, SONA 2021, Cyril Ramaphosa
SA’s SONA 2021
In his State of the Nation address last night, President Cyril Ramaphosa focused on a four point plan to tackle South Africa’s ills, in what he termed a year of change, progress and rebirth.
These included ongoing efforts to contain the spread of the Coronavirus, in addition to a vaccination programme to assist in overcoming the pandemic. He detailed the priority sectors, numbers of secured doses and schedules of delivery from the various suppliers, whilst reiterating his government’s commitment to defeating the Covid-19 as its primary aim. Without this goal it would not be possible to bring about the economic changes that are needed.
The second focus was on the country’s economic recovery – “We must accelerate our economic recovery.” Under pressure from demands by organised labour and also civil society with South Africa experiencing a sharp decline in growth and a significant increase in unemployment. Poverty is on the rise and inequality deepening has led to budgets being reprioritised and programmes deferred. The R350 Covid-19 support grant has been extended for three months, as an effective and efficient way to support those affected by the pandemic lockdown restrictions. And the Unemployment Insurance Fund (UIF) Temporary Employee/Employer Scheme has been extended to 15 March.
“All social partners who participated in the development of the Economic Reconstruction and Recovery Plan as part of our social compact have agreed to work together to reduce our reliance on imports by 20% over the next five years,” said Ramaphosa. “If we achieve our target, we will significantly expand our productive economy, potentially returning more than R200-billion to the country’s annual output.” On economic recovery, localisation emerged as key. Channelling Trade and Industry Minister Ebrahim Patel, Ramaphosa emphasised master plans for the clothing, chicken, vehicle and sugar sectors alongside 42 products, including edible oils, fruit concentrates and steel products, for sourcing locally. Another 1,000 products are identified in a recent Cabinet-approved SMME-focused localisation policy framework that is also meant to stimulate domestic SMME development.
As part of the third focus of implementing economic reforms to create sustainable jobs and driving inclusive growth. he announced the new updated scarce skills list would be published next week. This would meet a key business wish, while his undertakings on the energy front would also go a long way to meet long-standing requests.
While not specific on details, Mineral Resources and Energy would soon announce successful emergency power bidders to provide 2,000MW, while the government would “soon” start initiating the procurement of 11,800MW of renewable power.
But the positive spin ended when it came to Eskom. Rolling outages are set to continue over the next five years – considerably longer than the March 2022 deadline previously raised – given supply shortfalls of between 4,000 and 6,000MW.
“We will continue to work relentlessly and without pause to create a more modern, efficient and competitive economy that is more open to all South Africans.”
The reform of state-owned entities (SOEs) is on the table, with a pledge to produce legislation in Cabinet in this financial year and Parliament in the 2022/23 financial year.
And while spectrum auction was not raised, digital migration was, with the first phased switch-off of analogue television transmissions set for March 2021 – and to be completed by the end of March 2022.
South Africa is about five years behind the initial June 2015 International Telecommunications Union deadline to move from analogue to digital.
While much of Ramaphosa’s Sona was a reportback charting progress, with various ranges of detail, at least two announcements were new.
This included a proposed Water Resources Infrastructure Agency to oversee South Africa’s water resources. The agency will link to a raw water pricing strategy.
Tying in to the forth focus of fighting corruption and strengthening the state - the other new structure would be a statutory anti-corruption agency that would report to Parliament. That would be in addition to the National Anti-Corruption Advisory Council, whose members would be appointed shortly.
“Crime and violence continues to undermine people’s sense of safety and security. Tackling crime is central to the success of our recovery. Crimes like cable theft, railway infrastructure vandalism, land invasions, construction site disruptions and attacks on truck drivers hamper economic activity and discourage investment.”
“Tackling crime is central to the success of our recovery. Crimes like cable theft, railway infrastructure vandalism, land invasions, construction site disruptions and attacks on truck drivers hamper economic activity and discourage investment.”
Ramaphosa again talked about tackling corruption, but Covid-19 has shown that the corrupt have no sense of shame. The personal protective equipment rip-off, which the Special Investigating Unit laid bare last week, and which involves at least R13-billion in dubious contracts, is a true test of the president.
The president said a national anti-corruption strategy was being implemented to grow on the momentum being built in law-enforcement agencies. Mentioning the flow of shocking corruption allegations arising at the Zondo commission, Ramaphosa said: “Testimony at the commission has shown how the criminal justice system was compromised and weakened.”
As a whole its more of the same promises and little to feel confident about.
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