Economists are expected to be glued to their screens on Thursday to see whether President Jacob Zuma resolves to announce any major strategies to tackle the country’s ongoing economic woes. A volatile labor market, poor service delivery, and infrastructure shortages have all contributed to an increased cost of living for everyday South Africans, also affecting the country’s attractiveness to foreign business investors.
Economist Dawie Roodt identified three key issues which likely be addressed by Zuma during his speech. This included the much talked about power shortage at the country’s sole energy provider, Eskom, which has plagued the country with rolling blackouts over the past few months.
The second aspect would like be the usual economic statistics provided by the president annually during SONA, as well as any potential announcement of new infrastructural projects. The president was also likely to give some ‘between the lines’ indication of what could be expected in the budget of the Minister of Finance.
Another theme expected to be of interest is the slow rollout of the National Development Plan (NDP). Whilst the NDP is considered an official policy document, Roodt described it as more of a ‘wish list’ for the progress of the county.
“There is not that much certainty about everything in the NDP. It’s a little bit vague and sometimes contradictory, but it gives a broad guideline more or less where the ANC government sees the country and economy going over the next couple of years and decades,” he explained.
Despite this, he said the NDP was not being followed through with any proper policies.
“I very broadly agree with the NDP, and most economists and analysts certainly do. The actual implementation and broad policy statements going with that are something that I think needs to be addressed,” he said.
Roodt said one of his biggest concerns to the South African economy was that the civil service sector, both national and provincial, was something of a disaster and of concern to all citizens.
“I’m prepared to say that the civil service sector in SA is like a wet blanket that is smothering the spirit of entrepreneurship in the economy,” he stated.
During his SONA address last year, President Jacob Zuma vowed that the ANC government would create 6 million jobs in the period up to 2019.
Roodt however was doubtful such a feat could be achieved, adding that government’s job was not to create jobs, but rather create an environment that was conducive to the creation of jobs.
“Most of the jobs that have so called been created over the last couple of years have been in the civil service sector. So we’ve got a civil service that is really bloated, overpaid, and underworked,” he claimed.
He added that as a result of the current energy crisis at Eskom, job creation was likely to be further stifled. VOC (Mubeen Banderker)