President Cyril Ramaphosa is on Friday expected to deliver the much-anticipated stimulus package aimed at uplifting the country’s distressed economy.
The plan was deliberated and approved in this week’s Cabinet meeting.
The planned stimulus package proposes measures to reignite the country’s economy from a number of related portfolios, Communications Minister Nomvula Mokonyane said during a post-Cabinet media briefing on Thursday.
“The meeting agreed that South Africa’s economic recovery demands urgent implementation of the stimulus package and promised growth-enhancing reforms. Proposals were also discussed to establish an infrastructure-development initiative that draws in private sector funding and delivery expertise,” the Minister said.
South Africa is currently in a technical recession after data released by Statistics SA revealed that the economy had declined by 0.7% in the second quarter of 2018. In the first quarter of the year, the economy had shrunk by 2.6%.
Responding to a question, Mokonyane said Cabinet had deliberated on how high crime rates were affecting economic growth.
“We continuously agree that crime may have serious [effects] on investment but what is important is the need for partnership, as it is not only police who deal with crime. There are both social and economic factors that need to be attended to, including the behaviour of individuals and rights and responsibilities.”
The stimulus package is expected to touch on some of the key drivers of growth, including tourism, manufacturing and infrastructure development.
The Presidency last week said the stimulus package would “reprioritise government spending, within the existing fiscal framework, towards activities that will stimulate economic activity”.
Economic reforms on mining, telecommunications, tourism and transport are expected to be contained in the package.
It is also expected to contain how doing business in the country would be eased.
Wednesday’s Cabinet meeting also welcomed the offer extended by business for the secondment of private sector professionals to government, Mokonyane said.
The offer came during a preparatory meeting held by President Ramaphosa with business leaders, special investment envoys and the CEO Initiative, ahead of next month’s Jobs Summit and Investment Conference.
Mokonyane said Cabinet welcomed the investment drive, led by the Department of Trade and Industry, to Japan. It is part of the broader initiative of securing US$100 billion worth of investments into the South African economy over the next five years.
Japan is one of the country’s leading investment partners, with more than 140 companies operating in South Africa, which Mokonyane said is seen as a regional manufacturing hub into Africa. Meanwhile, President Ramaphosa will next week attend the United Nations General Assembly, where a Nelson Mandela Peace Summit will be held on 24 September.
The high-level plenary meeting will be on global peace, in honour of South Africa’s first democratically elected President Nelson Mandela.
Two days later, President Ramaphosa will participate in the high-level meeting on Tuberculosis.