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The Cabinet Ramaphosa will put together by the end of this month will reflect his seriousness in addressing South Africa's socioeconomic problems that include staggering unemployment, writes Phumlani Majozi.
is soaring. Even using a narrow definition, it stands at 26.4%, the highest
since 2003," London's The Economist wrote in 2015 when it covered South Africa's
economic mess. The economic mess is still alive today.
Last week, Statistics South Africa released unemployment
numbers for the first quarter of 2019; and they
were disheartening. The percentage of the unemployed continues to rise and is
now at 27.6%.
Because of this consistent, shocking joblessness, South
Africa ranked 3rd in Bloomberg's Misery Index in
According to Bloomberg, "The Bloomberg Misery Index relies on the
age-old concept that low inflation and unemployment generally illustrate how
good an economy's residents should feel."
index is by no means a perfect measure – but it does give a rough idea of the
seriousness of South Africa's unemployment crises.
understand how massive our unemployment is, compare it to other BRICS countries:
Brazil, Russia, India and China. Brazil's unemployment is 13%, Russia's is 6%, India's is
7.6%, and China's is 5%. The difference is embarrassing.
Our youth unemployment has risen to
55%. And the fundamental question now is: Can Cyril Ramaphosa, South Africa's
president, reverse this disturbing unemployment trend? His party, the African
National Congress (ANC) won South Africa's 6th democratic election.
So it is upon him now to forge ahead and create an environment that will be
business friendly and create jobs.
Just after Ramaphosa took the reins
as president of the ANC at Nasrec in 2017, I
argued that he must pursue Thatcherism – massive
privatisations and other free-market reforms. I believe that is the only way to
speed up economic growth and reduce this shocking unemployment. The private sector
creates jobs – not government. The role of government is to create an
environment that fuels private sector job-creation.
Ramaphosa must deregulate the labour
market and abolish the unnecessary licence requirements that make it hard to start
a business in South Africa.
Over the past year, there was a theory that Ramaphosa
could not pursue reforms because he had to keep the ANC united ahead of last
week's election. In other words, his main priority was his party, not the
country. To an extent that point was level-headed and I could understand it.
With the election now behind us, there should be no
excuses for Cyril Ramaphosa. He's the president of South Africa – our commander-in-chief.
He has to move our country forward – and that means he will have to – in many
instances – depart from the ludicrous policies that came out of the ANC's elective
conference in 2017.
This will require him to be tough – and he must do the
unpopular stuff earliest in his Presidency – while he's still favoured amongst
many South Africans.
Though his activism dates back to the days when he was a
unionist, between mid-1990s and 2012 Ramaphosa was in business. So he should
have an idea on what drives business growth in a way that encourages
The Cabinet Ramaphosa will put together by the end of
this month will reflect his seriousness in addressing South Africa's
socioeconomic problems that include staggering unemployment. The Cabinet ought
to be people who have not been accused of any public service scandals and who
are not hostile to business.
South Africa needs fast, private-sector driven economic
growth to reduce its unemployment. During the years of Nelson Mandela and Thabo
Mbeki, we experienced higher economic growth accompanied by relatively lower
post-election analysis, Frans Cronje of the
South African Institute of Race Relations wrote, "The path to growth –
based on policies that secure a free, open and prosperous society – is open to
us, and there is now no excuse for Cyril Ramaphosa'sgovernment not to lead the way."
I agree with Frans; there is now
no excuse for Ramaphosa's government not to lead the way on pro-growth reforms
that will reduce our shocking unemployment levels. This is now Ramaphosa's
problem and he must fix it!
- Phumlani M. Majozi is a politics
and economics analyst, a senior fellow at AfricanLiberty.org, radio talk show
host, and non-executive director at Free Market Foundation South Africa. Views
expressed here are his own; not of the Free Market Foundation South Africa. Follow
him on Twitter: @PhumlaniMMajozi.
Disclaimer: News24 encourages freedom of speech and the expression of diverse views. The views of columnists published on News24 are therefore their own and do not necessarily represent the views of News24.
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