The government cannot afford to “miss the boat” to introduce economic interventions in 2025 that will help improve the livelihoods of its citizens, say two ministers in the cabinet’s economy cluster.
The ANC national executive committee (NEC) will meet on Friday to finalise the party’s January 8 birthday statement which will be delivered by party president Cyril Ramaphosa in Khayelitsha, Cape Town, this weekend.
Because the party has long used the event to set its and the government’s programme for the year, analysts, investors and organised business have been keen followers of the statement.
This year’s statement will have added importance because the party, which fared poorly in last year’s general election and failed to get a majority for the first time since 1994, is preparing for crucial local government elections in 2026. The poor performance has forced it into a government of national unity (GN) with rivals the DA, IFP and smaller parties.
We have not taken the economy seriously for some time. Our economy has been underperforming for more than decade.
— Finance minister Enoch Godongwana
It also comes when fissures are widening within the party and with its alliance partners.
Trade, industry & competition minister Parks Tau and his finance counterpart, Enoch Godongwana, said the high cost of living, poor public transport, high data costs, jobs and logistical challenges at ports and infrastructure would get emphasis this year.
“We have not taken the economy seriously for some time. Our economy has been underperforming for more than decade,” Godongwana told Business Day.
Growth should be taken as the number one priority, not only by the government but by society as a whole, he said.
The big macroeconomic change was investment in big infrastructure projects, which would push SA towards higher economic growth, Godongwana said.
“My role is to use fiscal policy to achieve desired outcomes. Infrastructure spending is the big change. We are shifting in focus to public infrastructure projects that support economic growth.”
He said the growth needed to be realised “soon”.
“We are doing the best we can this year,” the minister said.
SA has a critical need to invest in infrastructure, which has not been a priority in recent years amid a culture of corruption which has left the state battling to meet its wage bill and debt obligations.
Tau acknowledged the huge challenges the country faced, but said it should build on green shoots in the economy.
“Post-elections business confidence has increased and that offers great opportunity. We cannot run the risk of missing the boat,” he said in an interview with Business Day.
“The revised industrial policy action plan with increased value chains is being finalised as we speak.”
Tau detailed the plans. He said the water crisis was brought about mainly by corruption in the water boards, ageing and unmaintained infrastructure and a severe drought.
“There is no shortage of water. Distribution systems are not operating properly,” he said. “We need functional water infrastructure or there will be social instability and there can be no investment in value chains which will create economic growth,” he said.
He said food prices were also high on the agenda going into the new year.
“We have been engaging with the sectors on areas of intervention, specially on retail, as a matter of urgency. We have heard the plight of South Africans.”
The GNU was agreed on the need to transform the telecoms and automotive sectors, he said. He alluded to discussions around SA bringing down the costs of data, increasing value chains and kickstarting the mass manufacturing of electric vehicles in the medium term. Some remain sceptical, however, about whether the GNU can make a difference in the lives of ordinary South Africans.
“The GNU framework has brought confidence from stakeholders to make the country work. However, the GNU though does not change the character of the public service that was there before 2024,” said political analyst Lucky Mathebula.
“We have the same public service and until that public service understands its role in the new framework and what it needs to do, the state can only then start making a meaningful difference. We must never see the GNU as a silver bullet.”
While the economy is expected to take centre stage in the statement, the issue of service delivery will also feature prominently as the party braces for what could be bruising local government elections next year.
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