Ramaphoria finally delivering great economic dividends

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President Cyril Ramaphosa. Picture: @MYANC/Twitter

Ramaphosa was sworn in as President of the Republic on 15 February 2018. From his very first speech in Parliament, coincidentally a State of the Nation Address, Ramaphosa fashioned himself as ‘an Economy President’. Ramaphosa understood that all the country’s problems, including those of the ANC, were all linked to a poorly performing economy. The triple threats of poverty, unemployment and inequality, the ideological battles within the ruling party, business confidence, investments, labor relations, crime, destruction of families and communities, all could be tied to a poorly performing economy that was not giving our people a stake. Ramaphosa was therefore choosing to go to the heart of the problem, putting the entire country on his broad shoulders and that first speech signaled a man that was both ready and capable of turning our Ark into better shores. 

Ramaphosa, from a career with an extraordinary range, a unionist, a politician, business man and now President, understood that first and foremost, ‘confidence, is the cheapest form of stimulus’. All economic and social Stakeholders needed to regain their confidence in their government and leaders, which had been eroded over the last few years. Ramaphosa equally understood that no government alone, however good that government can be, can singularly solve a nations problem. The best the government can do is to inspire the nation, the various stakeholders, to all rise to the occasion, make commitments and see how they measure up against the hard reality. 

Ramaphosa went to work. His challenges were clear: Corruption, political instability, policy uncertainty and a government that could not be trusted. The remedy was clear:  Restore trust in our leaders and institutions, Collaboration between business and labour and clarify policy, close the fiscal gap,  stabilize debt and restore state-owned enterprises to health. After a full year in office, Ramaphosa has delivered and more. At the 100 day mark of Ramaphosa’s Presidency, The SA Citizens’ Survey (Sacs) found that 65% of its respondents approved of how the President was conducting government affairs and restoring peoples confidence in their government. Just last week, A poll conducted by the governing party’s research unit said Ramaphosa has an approval rating of 73% by South African voters. Ramaphosa seem to have pulled up the approval ratings of his party too which are now at 65% according to internal party poll. 

The confidence in Ramaphosa, his party and the country was echoes last week by Vedantas Chairman, the biggest shareholder of Anglo American, when he declared at the opening of a $400m Vedanta Zinc mine in Northern Cape, that ‘Investing in South Africa today makes the most business sense’. How did Ramaphosa turn things around so quickly after almost an investment boycott that saw South Africa being bypassed by Foreign Direct Investments into emerging markets for years, resulting in our economy struggling to register even a single percentage in growth for years. What were the immediate things that Ramaphosa knew would bring this cheapest form of stimulus, confidence, which he could implement and give a signal to the people that government was now on a new trajectory.

Ramaphosa started with a Cabinet reshuffle, almost taking people back to areas where they had accumulated experience and had been relatively successful. He did this in order to give our government a sense of continuity and institutional capacity. Malusi Gigaba was back at home Affairs where he actually had done great work and Derek Hanekom was back in Tourism where he had made great strides in positioning brand South Africa as prime destination for business and holiday makers. The President also brought in some new blood, with proven capacity to beef up his new government. This of course was part of the strategy and tactics resolutions of the policy conference, where the conference felt that the state, which is the Pillar of Transformation, needed to be recapacitated in order to deal with multiple challenges, particularly growth and transformation.

Ramaphosa brought in a former governor, Tito Mboweni, in whom the country had great confidence into Finance Ministry, to say little about his extra curricula activities on Twitter. Tito has eased into his new job like a skilled technocrat and politician that he is. One of the key appointments was in the Mining Ministry. Gwede Mantashe, a very capable man by any measure, with a masters degree in mining, took the job with great passion and has delivered great dividends. First among Mantashe’s task was to solve the mining charter impasse. 

From day one, Ramaphosa made decisive interventions at state-owned entities (SOEs) – quickly removing old boards and executives, who had grown fat and complacent and corrupt, forgetting the mission we are on. Then there were changes at the South African Revenue Service, removing that inept, corrupt and arrogant Tom Moyane. Ramaphosa equally realized workers had been experiencing wage injustice on many occasions because there was no minimum wage. He then went on to champion a new minimum wage which received wide ranging support including from ANC’s important alliance partner and largest union, COSATU. 

The inclusive approach of government has seen Ramaphosa hosting a Jobs Summit, an Investment Summit, a BRICS Summit and Gender Equality Summit, opened Special Economic Zones, all to ensure that as many Stakeholders are participating in shaping the future of our country. Since then, ‘Rand Merchant Bank/BER business confidence index (BCI) has jumped by 11-index points from 34 in 2017 (fourth quarter) to 45 in 2018 (first quarter)’ . ‘Data from the Institute of International Finance (IIF) on Friday showed that South Africa had a good start to the year, accounting for the largest share of $31.7billion (R450.7bn) of net capital flows to emerging markets (EM) in January. In particular, large flows into South Africa ($16.4bn) and India ($13.3bn) were behind the surge in overall inflows’. 

Demand for business travel is high, our tourism is striving, and businesses are investing in new plants and discovering new and lucrative products that will anchor our growth for years to come. Just early February, ‘Total SA said it has opened up a new “world-class” oil and gas province off the coast of South Africa after making a significant gas-condensate discovery there’. A thriving economy is a source of great political stability. Ramaphosa has a potential to become one of the greatest President the ANC and country has ever had. 

 

Yonela Diko is a Media Consultant & Political Strategist.