Edition October 2024

As public servants, we are mandated to fulfil the promise of a better life for all. Our role as implementers of government programmes is important in ensuring that citizens experience the benefits of a thriving society. We have a duty to contribute towards a positive economic outlook and create a more stable and attractive environment for investment through our work.

While various external factors can influence our economy – many of which are beyond our control – it is encouraging to observe a positive trajectory in recent events, a sign of better times ahead. Most of these achievements can be attributed to government initiatives aimed at fostering economic growth and stability, including partnering with the private sector. President Cyril Ramaphosa and business leaders recently launched Phase Two of the Government   Business Partnership; a partnership to accelerate economic growth and creation.

The partnership and initiatives from the Energy Action Plan, have led to the country enjoying over 180 days without load shedding. This was made possible through reforms made in the energy sector, which have boosted investment and, deployment of expertise to key power stations as a result, addressing electricity challenges.

There has also been a positive shift in our monetary policy. In September 2024, The South African Reserve Bank cut the repo rate by 25 basis points, bringing it down to 8%. The cut, which was the first one in four years, moved the prime lending rate to 11.50%.

In addition, the country’s inflation is also stabilising. Statistics South Africa recently reported a decrease in consumer inflation to 4.4% in August, from 4.6% in July – the lowest since April 2021. Just as we celebrate Transport Month, fuel prices dropped to their lowest level since February 2022.

These positive indicators align with the objectives of the Government of National Unity (GNU), which places inclusive economic growth at the centre of the national agenda. The  GNU priorities – as unveiled by President Cyril Ramaphosa during his Opening of Parliament Address earlier this year – are driving inclusive growth and job creation; reducing poverty and tackling the high cost of living; and building a capable, ethical and developmental state. A stronger economy is essential for the achievement of these priorities.

The partnership with businesses has been crucial in advancing economic growth and job creation. For example, the YES programme – one of the initiatives that came from the government/ business partnership – has created over 155 000 work placements for unemployed youth. An estimated 45% of these young people were employed permanently after their internship. Through initiatives like Business for South Africa and the Resource Mobilisation Fund, the private sector has supported the performance of key power stations, rail corridors and port terminals.

These are crucial enablers of economic growth.

The SA Small and Medium Enterprise Fund is another collaboration between government, labour and business to address challenges to the country’s economic growth. It provides funding to innovative startups and small, medium and micro enterprises.

In further securing an enabling environment for investors, government has made significant progress in strengthening the law enforcement agencies and reversing the effects of state capture. The efforts to continue to create a conducive environment for economic growth, stability and prosperity are in our hands!

In September 2024, National Treasury announced that following the International Monetary Fund’s visit to the country, the fund recognised the resilience of our economy.

“While recognising the macroeconomic challenges highlighted by the IMF, the South African government has affirmed its commitment to prioritise rapid, inclusive and sustainable economic growth to tackle prevailing high levels of poverty and inequality,” stated National Treasury in a statement.

The strides we are making today contribute towards growing an inclusive economy anticipated in the al Development Plan 2030. ❖

Highlights of government initiatives aimed at growing the economy

• The National Logistics Crisis Committee is stabilising and improving the logistics system to support key export industries. Fundamental reforms are underway through the Freight Logistics Roadmap – to enable open access to the freight logistics network and introduce private sector participation in container terminals for the first time.
• Infrastructure investment is increasing. As of December 2023, investments value amounted to R540 billion – R169.24 billion under procurement; R233.87 billion under construction; R4.63 billion of completed projects and the rest under feasibility and pre-feasibility studies.
• The spectrum auction and analogue switch-off have been completed, improving network quality, reducing data costs and expanding digital access.
• The country has received international funding to support the Just Energy Transition and Green Economy opportunities – catalytic projects have been identified for implementation.
• Tourism has experienced significant growth in arrivals, income and growth, contributing to job creation and the country’s gross domestic product.
• The automotive, beverage and steel sectors continue to generate income – export promotion initiatives have seen exports to the rest of Africa crossing the R100 billion threshold for the first time since 2015.
• Government has implemented a large-scale programme of land restitution and land redistribution, with about 24% of farmland now owned by black farmers.
• The Agricultural Economy has grown strongly over the past three decades, creating thousands of jobs.