JOHANNESBURG – President Cyril Ramaphosa on Monday moved to contain the fallout from his apparent slow pace of reform, assuring investors that his government was working towards the finalisation of the restructuring of Eskom and SAA and would lower entry barriers for small businesses.
Ramaphosa used his keynote address at the Financial Times Africa Summit in London to tell an audience that included heads of state, investors, innovators and business leaders that reforms such as the finalisation of the energy roadmap, release of broadband spectrum, changes to the visa regime, fixing Eskom, SAA and accelerating land reform had become the focal points of his government.
He said the government was developing plans for industries with high growth potential, such as automotive, clothing and textiles, gas, chemicals and plastics, renewable energy, oceans economy, agriculture and high-tech industries.
“Since last year, we have been implementing key structural reforms to address perennially weak growth, ignite economic activity, restore investor confidence and create jobs,” Ramaphosa said. “We have taken steps to provide greater policy certainty in areas such as mining, oil and gas and telecoms as part of efforts to create a stable environment for investment.”
Ramaphosa said the government was in talks with interested parties on partnering with struggling national carrier SAA.
Earlier, in his weekly newsletter to the nation, Ramaphosa said that the government was working on the introduction of a common application form across development funding institutions in a bid to attract more investment and create economic opportunities for entrepreneurs.
Ramaphosa’s tone was in line with Finance Minister Tito Mboweni’s growth strategy, which has largely been accepted as the government’s economic blueprint.
In the past few weeks, the government has put up a concerted effort aimed at addressing investor fears and ratings agencies, particularly Moody’s, which still has the government’s sovereign debt rating above junk.
Ramaphosa said many entrepreneurs struggled to mobilise capital and access markets, and found it difficult and costly to meet the regulatory requirements for starting and running a business.
“Key to this will be the introduction of a common application form across our development funding institutions. We are working to make business easier for both the person starting out in their garage and for the multinational looking to open a new factory,” Ramaphosa said.
“This is important for attracting foreign direct investment, but it is equally important – if not more so – for cultivating a new crop of home-grown companies.
“The most effective way to reduce poverty and create economic opportunities for South Africans living in townships and rural areas is by enabling them to start up and grow their own businesses.”
In London, Ramaphosa said South Africa was positioning itself as an investment destination of choice, adding that good governance, growth enhancing reforms and macro-economic stability were at the core of these efforts.
He said the government was scaling up initiatives to promote youth employment and small business development.
“South Africa recognises that to grow our economy, create jobs and support investment we have to pursue prudent fiscal policies coupled with sound macroeconomic management,” he said.
“At a time when our fiscus is under great pressure, we are committed to ensuring debt sustainability, improving the composition of spending and reducing risks arising from contingent liabilities, especially of our state-owned enterprises.”