South Africa’s biggest problem is not the slow pace of reform, which President Cyril Ramaphosa said last week he regrets, but the government’s failure even to conceive of any meaningful reform capable of attracting the investment that is indispensable to economic growth and job creation, according to IRR CEO Frans Cronje.
In a statement on the eve of the third South Africa Investment Conference – starting in Sandton today – Cronje said: ‘It is becoming increasingly difficult to understand what the government means when it speaks of reform. On labour, empowerment, crime, healthcare and education, no workable reforms have been proposed. On the contrary, with respect to both labour policy and empowerment, South Africa’s investment competitiveness has regressed since Mr. Zuma left office.’
Cronje was responding to Ramaphosa’s remarks in Parliament last week in which he acknowledged that ‘had we acted differently [prior to the pandemic] maybe the situation that we are in could have been a lot better’. He added that ‘(we) delayed in embarking on our reforms which we should have embarked upon a lot earlier…’.
Cronje added: ‘On property rights, the government has moved with increasing speed to implement its expropriation without compensation (EWC) policy and has consequently frightened much investment away.
‘On fiscal prudence, the finance minister has been repeatedly undermined. South Africa’s problem is not just that reforms have not been implemented but that they have not even been conceived, while what has been implemented has reduced South Africa’s attractiveness to investors.’
The IRR said it had long argued that ‘if the government abandoned failed or damaging policies and implemented reforms guaranteed to improve the lives of millions of South Africans, it would have nothing to regret’ and would ‘find willing partners among investors, who remain as wary today as they were in 2018’.