South Africa’s President Jacob Zuma promises to boost the economy, skills and jobs with a massive infrastructure development

February 12, 2012

Africa, International

Jacob Zuma promises to boost the economy, skills and jobs with a massive infrastructure development
 
GAYE DAVIS, SUE SEGAR and MICHAEL MPOFU
The Star (Johannesburg)
Political Bureau
 
PRETORIA- Jacob Zuma’s promise to boost the economy, skills and jobs with a massive infrastructure development drive has been welcomed as a step in the right direction.
 
Cosatu general secretary Zwelinzima Vavi said Zuma’s fourth State of the Nation address, delivered at Parliament last night, “pressed all the right buttons”.
 
But the labour federation leader was disappointed that Zuma did not unequivocally promise to ban labour brokers and said its planned strike on March 7 would go ahead.
 
Zuma was relaxed and confident as he delivered what many considered his best State of the Nation address yet.
 
Economist Dawie Roodt of the Efficient Group said: “I have a sense of a considerably more experienced president. The wish list and promises are fewer and there’s a bit more realism.
 
“We have listened to a more mature, realistic president.”
 
The focus on infrastructure development would help the mining industry and exporters.
 
However, the “elephant in the room” was whether the massive investment would be spent efficiently, Roodt said.
 
The government has been pushing infrastructure as a means of kick-starting the economy and reducing unemployment since at least 2010.
 
Zuma did not report back on progress on previously announced plans, however.
 
Instead he gave details of what he said was a streamlined cluster of major projects involving mainly Limpopo, Mpumalanga, North West, the Eastern Cape, KwaZulu-Natal and the Western Cape.
 
He also announced moves to cut the cost of doing business – including a reduction in port charges, which will help exporters, particularly in the motor industry – and said he had asked Eskom to find ways of keeping future electricity price-hikes in check, which will please all consumers.
 
“We need an electricity price path which will ensure that Eskom and the industry remain financially viable and sustainable, but which remains affordable especially for the poor,” Zuma said – but added that South Africans had to play their part by saving electricity.
 
Public Enterprises Minister Malusi Gigaba told Independent Newspapers afterwards that any stay in electricity tariff rises would be “contingent on South Africans reducing demand”.
 
Gigaba said the infrastructure announcements showed the “self-confidence of the state” in its own companies.
 
Economic Development Minister Ebrahim Patel said by improving rail and road links, the government could “unlock enormous additional mining in Limpopo and the Northern Cape”.
 
DA leader Helen Zille welcomed Zuma’s focus on the economy and infrastructure. “The big challenge is to translate the focus into governance and delivery. He did not focus enough on the obstacles to this, which are corruption and cadre deployment.”
 
The party’s parliamentary leader, Lindiwe Mazibuko, asked where the money would come from, and asked about the government’s capacity to spend it.
 
“We are already spending R30 billion less than we should be on infrastructure. We have a high (state) wage bill and annual strikes. It is impossible for the government to predict how much it will spend,” she said.
 
FF Plus leader Pieter Mulder said the infrastructure spending plans gave “hope for the future”, but would have liked more certainty on other policy debates form the president.
 
Zuma also announced that a special fund he announced two years ago to help people buy their own homes would roll out in April.
 
The R1bn loan guarantee fund would allow for people who did not qualify for free RDP houses, but who did not earn enough to qualify for mortgages, to get loans from banks.
 
Also, people earning between R3 500 and R15 000 would from April be able to get a subsidy of up to R83 000 from provinces to help them buy houses through an accredited bank.
 
He said the cabinet at its January lekgotla had reviewed progress from 2009, rather than the past year, noting “steady progress” in key areas including health, education, fighting crime, energy and water.
 
The government’s “intensive focus” on education was paying off, Zuma claimed.
 
But the triple challenge of unemployment, poverty and inequality remained: “Africans, women and the youth continue to suffer most,” he said.
 
As mining was a critical jobs driver the government had developed a beneficiation strategy to create job opportunities.
 

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