Business body throws its weight behind Mboweni's economic reform plan

Business Leadership South Africa CEO Busisiwe Mavuso
Business Leadership South Africa CEO Busisiwe Mavuso
BLSA

The board of Business Leadership South Africa has thrown its weight behind National Treasury's new economic policy paper, saying it crystalises the way forward for an economy "on the edge of a precipice”.

The organisation, which represents big business in SA, said it was encouraged by the clear direction given by Finance Minister Tito Mboweni in the 77-page economic strategy paper, which outlines a series interventions and reforms aimed at stimulating SA's sluggish economy.

“South Africa is on the edge of a precipice and the problem has been the lack of clarity and decisiveness on some the key issues articulated in this paper,” said BLSA.

The document, released on Tuesday with a call for public comment, has been met by mixed reactions. While trade union federation Cosatu slammed it as “incoherent, confused and unreliable”, its alliance partner the ANC said it was necessary to consider a plan taking another look at South Africa's economy. 

BLSA said the documented rightly identifies “the causal factors and steps to be taken to address them” including unemployment and low investor confidence. In July SA's unemployment rate increased by 1.4 percentage points to 29% - the highest rate in nearly 15 years. In the first quarter of 2019, meanwhile, the economy contracted by 3.2%, the largest quarter-on-quarter drop in a decade. Stats SA is set to announce SA's GDP growth figures for the second quarter on next week.

BLSA said "the business of government is to make tough economic choices ... to benefit the rest of the country, and this paper is a step in that direction."

According to Treasury, SA's current economic path is unsustainable, with the country facing the triple threat of stagnating economic growth, rising unemployment and high inequality.

ZAR/USD
16.29
(-1.03)
ZAR/GBP
21.04
(-0.38)
ZAR/EUR
19.30
(-0.82)
ZAR/AUD
11.89
(-0.59)
ZAR/JPY
0.16
(-0.94)
Gold
1950.17
(+0.16)
Silver
26.81
(-0.75)
Platinum
930.48
(-0.19)
Brent Crude
43.78
(+2.41)
Palladium
2352.84
(+1.72)
All Share
54673.65
(-0.66)
Top 40
50399.16
(-0.59)
Financial 15
9841.32
(-2.14)
Industrial 25
72558.00
(-1.08)
Resource 10
55438.10
(+0.58)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1290 votes
It depends on how the funds are used.
73% - 8603 votes
No. We should have gotten the loan elsewhere.
16% - 1893 votes
Vote