We must work together to boost economic growth


When President Cyril Ramaphosa announced the administration’s economic stimulus and recovery plan detailing workable plans to rejuvenate our economy to respond to the immediate and long term challenges, I was reminded of how former US President, Barack Obama did the same for his country early in his administration.

While Obama was responding to the rivulets of the 2008 economic recession caused by reckless behavior of the private sector, Ramaphosa is responding to the potent results of corruption caused by our own comrades through what is now called state capture. Those of us elected to serve in the ANC, deployed to government have a responsibility to move beyond questioning whether state capture exists on or not.

We have a moral and constitutional duty to work with the president in stimulating our economy to attract investment, create jobs and we must be willing to change how the public is used in this regard.

The president’s plan is the ongoing work we committed to do at the 54th national conference of the ANC in December 2017 by igniting economic activity, restoring investor confidence, preventing further job losses, creating new jobs, and to address some urgent challenges that affect the conditions faced by vulnerable South Africans, requires urgent action by the deployees of the ANC to implement it.

At the heart of this plan as President Ramaphosa puts it: “is the reprioritisation of public sector spending towards activities that have the greatest impact on economic growth, domestic demand and job creation, with a particular emphasis on township and rural economies, women and youth.”

Where we are deployed all of us must implement growth enhancing economic reforms, reprioritise public spending to support job creation and support the establishment of an Infrastructure Fund. When we do this, issues like addressing urgent and pressing matters in education and health and investing in municipal social infrastructure improvement will be the outcomes of our work.

We must deem this as part of the ongoing process by government to grow the economy for the benefit of our people. Delivering his 2016 economic progress speech in Greece, Obama said lowering carbon emission, creating jobs, investing into built infrastructure, increasing tax compliance, with tax cuts for poor households, reducing poverty, narrowing inequality point to the direction that should be taken to build inclusive economy required for democracy to deliver the prosperity and hope the people need.

Faced with growing unemployment, poverty, sluggish economy, very low local private investment, the Eastern Cape province has no choice to support the economic stimulus plan. For us in this province, we welcome this in the context of pushing the realization of long pronounced strategic investments that include Mthombo oil refinery at Coega, Umzimvubu water project, commercializing Agriculture, expanding tourism.

The growing public sector investment appetite in sectors like agriculture, public sector construction, automotive sector, the inspiring investments commitments by multinational companies flowing from President Ramaphosa’s work prove that when we work together as sectors we can grow the economy.

The ongoing implementation of the provincial economic development strategy, investment promotion plan and the agriculture economic transformation strategy by the provincial government is part of our programs to change the face of the provincial economy. The R10 billion investment by Mercedes Benz into the province, take over of the General Motors operations by Isuzu, ongoing government investment into the province confirms that our province can grow to the benefit of everyone, especially the unemployed, poor, small, medium and large businesses.

All these investments must be distributed equally to benefit all provinces that must use delegated responsibilities in local councils, provinces to make the environment conducive to do business and attract investment. All of us must use the authority we have to ensure that public sector procurement, including that of the infrastructure key in the economic stimulus plan benefits small businesses and that they will be paid within 30 days without delays.

Part of the unemployed people includes people who used to own small businesses who could not pay their staff, provide for their families because their invoices were not paid or they did not get tenders. They lost a lot because of that.

Part of the unemployed people are the former workers of the small businesses who left because salaries were not coming in as a result of inexplicable delays caused by our officials in municipalities, government departments and state owned enterprises. For our economy to grow this must come to an end.

Ongoing awarding of tenders to the same companies by government officials contributes to the sluggish growth. We cannot give same companies tenders and exclude many businesses. That is wrong and it must stop now.

We have many skilled and experienced people that can construct roads, bridges, houses, hospitals and everything. We must empower them to meet the criteria we need so that they too benefit from the public procurement. If we don’t stop this, another form of state capture will go unhindered. We have a duty to stop this by giving all businesses opportunities to benefit from the public sector procurement.

Reprioritizing public sector spending means we must be transparent, fair and share the opportunities. It does not mean we must give tenders and contracts to a select few. The private sector too must spread its procurement opportunities so that all businesses benefit.

We must learn from the successes of Obama’s economic stimulus plan of lowering poverty, creating more jobs, increasing public sector infrastructure spending, lowering carbon emissions while growing the economy, increasing access to health care and education.

The provincial government will have to increase working with national departments, their entities in the province to benefit from available funding. Doing this is important as it is giving South Africans the better life the ANC committed to give to all South Africans.


 Lubabalo Oscar Mabuyane is the ANC Eastern Cape Chairperson, Finance, Economic Development, Environment Affairs and Tourism MEC