By Phenyo Selinda
For the next five years, the South African government’s main goal is to achieve rapid and inclusive economic growth. This plan aims to create jobs, reduce poverty, and build a fairer and more equal society. President Cyril Ramaphosa shared this vision in Parliament on Tuesday while presenting the Presidency’s Budget Vote.
“To achieve this, we must configure the system of government to support a significant expansion of investment in infrastructure. We have seen the value of collaboration in pursuing this objective,” President Ramaphosa said.
Boosting Infrastructure Development
President Ramaphosa emphasised that through Infrastructure South Africa, the government has been able to tap into private sector expertise to enhance the preparation, financing, and implementation of infrastructure projects. “Through the Infrastructure Fund, we are going to explore new approaches to blended financing of infrastructure, using the fiscus to leverage additional funding from the private sector, development finance institutions, and other sources,” he explained.
Working closely with Independent Power Producers has been crucial in advancing their projects to the construction phase, significantly reducing load shedding.
Exceeding Investment Targets
In 2018, the government set a target to mobilise R1.2 trillion in new investments over five years. By the conclusion of the fifth South Africa Investment Conference last year, this target was exceeded, raising over R1.5 trillion in new investment commitments. “We have visited many factories and projects built or expanded due to these investments and seen the jobs they have created,” the President noted.
Reducing Red Tape
To enhance the business environment and create jobs, a team to address red tape reduction was established in The Presidency, led by Mr Sipho Nkosi. This team works with various departments, public entities, and the private sector to address red tape at provincial levels and support city municipalities with reform action plans to improve business processes.
“Through this experience, it is clear that the removal of red tape is a cross-cutting exercise that requires a coordinated and integrated approach,” President Ramaphosa said.
Operation Vulindlela: Driving Reforms
Significant progress has been made in implementing reforms to enable economic growth, supported by Operation Vulindlela, a joint initiative of the Presidency and National Treasury aimed at accelerating structural reforms and supporting economic recovery. These reforms focus on modernising network industries, alleviating load shedding, improving the logistics system, reducing data costs, enhancing water supply, and attracting necessary skills.
Future Focus: Sustaining Reforms and Tackling Inequality
The government will now embark on the second phase of Operation Vulindlela, focusing on sustaining the momentum of current reforms and addressing local government issues, harnessing digital public infrastructure, and tackling spatial inequality. “We will work closely with provincial and local governments to address service delivery challenges, in line with our Constitutional mandate,” President Ramaphosa stated.
A recent independent study by the Bureau of Economic Research estimates that the reforms under Operation Vulindlela could increase real Gross Domestic Product growth to 3.5 percent by 2029.
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