Mboweni's revised economic blueprint almost ready

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Finance minister Tito Mboweni at the Banking Summit. Photo: The Banking Association of SA.
Finance minister Tito Mboweni at the Banking Summit. Photo: The Banking Association of SA.

The economic policy document released by the National Treasury in August is being finalised after receiving input from various sectors, Finance Minister Tito Mboweni said on Thursday.

The document, titled Economic Transformation, Inclusive Growth and Competitiveness: Towards an Economic Strategy for South Africa, attracted different opinions from social and economic sectors, as the country battles to dig itself out of a growth slump.

"The expectation is that when we submit the Medium Term Budget Policy Statement we should also provide the finalised version of the economic strategy," Mboweni said as he opened a colloquium on the economy.

Mboweni told a meeting attended by academics and economists from the public and private sector that the document was not static, but open to changes.

He added that over 700 comments on the paper were received, but only those which offered relevant input, consistent with the directive of the National Treasury, would be considered.

"We are now at the tail end of the preparations," he added.

The economic policy discussion document outlined a number of reforms aimed at raising average economic growth in South Africa by 2.3 percentage points over ten years and creating one million job opportunities. Some of the proposals included increased support for exports, agriculture and tourism.

The document has been met with a mixed response, with the ANC’s alliance partner, the Congress of South African Trade Unions, criticising it as incoherent and unreliable.

Poor implementation 

Government has in the past published several policy documents on stimulating the economy and Mboweni, a former governor of the Reserve Bank, singled out poor implementation as a major stumbling block.

"One of the biggest constraints to the economy of South Africa is lack implementation about those things that have been decided upon."

He said if, at some point, at least 30% of the things agreed upon were implemented, "we would be making great progress" - adding that this shortcoming "speaks to the capacity and capability of the state". 

"It speaks to the failure to rally around the major economic actors to pull in the same direction."

No illusions

Speaking on the divergent views that greeted the strategy document, Mboweni stressed the he was under no illusion that the road ahead was going to be easy.

"The key economic actors are not moving in the same direction, they are pulling away from each other, and therefore we are not able to move decisively in the direction that we are supposed to move.

South Africa's economy has over the past few years been stuck in a slow growth rut, with government and independent agencies constantly downgrading its growth prospects. 

In September, ratings agency Moody's revised down South Africa's growth forecast for 2019 from 1% in June to 0.7%, listing slow pace in policy implementation as a major hindrance. Economic growth is expected to pick up to 1.5% in 2020.

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