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Ramaphosa instils hope, but ignores the elephants

The president and his new prosecuting deployments need to hit the acceleration pedal on corruption – soon.

Hope is a dangerous human trait, but President Cyril Ramaphosa’s State of the Nation Address (Sona) 2019 provides some reasons to be optimistic.

Great speeches do not change a country’s moral trajectory, especially when the rot of corruption is as deep as it is in South Africa. But listening to Ramaphosa list the things he has achieved since addressing the nation last year, it is evident that a lot has happened under his watch.

Read: Ramaphosa sets out plans to revive flagging economy

In the nearly two-hour address, he stepped off the eggs that were stood on during last year’s speech after Jacob Zuma’s forced resignation, and tackled key challenges facing South Africa head on, offering some tangible solutions. The main highlights for me were:

  • The creation of a new Scorpions-like unit within the National Prosecuting Authority to fight corruption. The key, of course, is the commitment to give the unit the resources and mandate to prosecute without fear or favour – and that includes ANC leaders. After all, it was the ANC who disbanded the original Scorpions in 2007.
  • That Eskom remains the number one short-term threat to our economy. The announcement of the unbundling of Eskom into three parts is hopefully the first step to increased “private sector involvement” (don’t mention privatisation). 
  • The acknowledgement that unemployment is at desperate levels, requiring urgent interventions to accelerate job creation.

Despite Ramaphosa’s frankness, there were a few elephants in the room.

The biggest was corruption and the fact that many of those implicated happened to be sitting metres away from the podium. The state capture and other inquiries have revealed the extent of corruption within the ANC, government and the top leadership of the country.

The rot is deep, and promises to curb corruption ring hollow when implicated cabinet ministers applaud the announcement of anti-corruption plans.

We need to see the arrests of high-profile individuals and aggressive prosecution to restore any form of meaningful confidence in government.

This must include Zuma, whose absence was conspicuous, and his top state capture lieutenants.

Hopefully, we will see Ramaphosa and his new prosecuting deployments hit the acceleration pedal soon, maybe even as early as May 9.

Dire fiscal position

A second elephant, which perhaps did not receive sufficient airtime, is the dire financial position of the country. In a few weeks, finance minister Tito Mboweni will sketch a grim picture of the health of our state’s finances. We’ll see a budget deficit of nearly 5% and debt to GDP levels of 60%, excluding the potential impact of an Eskom bailout.

Read: SA to split Eskom in rescue plan – Ramaphosa

This means South Africa’s wallet is empty and the credit card is maxed out. There isn’t any money left to fund ambitious projects. In this context, it was interesting to hear Ramaphosa’s promises of increased infrastructure spending and increased investment to create jobs and accelerate economic growth.

I don’t know when the government will realise it cannot “create jobs”. You cannot simply write a law to create jobs.

Implosion of trust

This brings me to a third elephant: The total implosion of trust between the private sector and government.

The jobs South Africa so desperately needs can only flow from the private sector, where entrepreneurs invest in new ventures because they believe they can make money from the deployment of capital.

The ‘private sector’ in this context is also not the big multinational companies or brown-nosing CEOs flanking the president in Davos. It is the army of small entrepreneurs who work in the trenches of our economy. If Ramaphosa can restore their trust in government and the future of South Africa, job creation will accelerate quite quickly.

To achieve this, Ramaphosa needs to kill the first elephant.

South Africa requires a common goal

Ramaphosa also highlighted the significant racial tension and intolerance in South Africa. If this cancer is not cured soon, any projects to improve the social and economic recovery may be stillborn.

Ramaphosa can only address this if he can instil a new common goal to which every South African subscribes and will work towards achieving. We last had such a goal when the country pulled together to host the 2010 World Cup.

The best case scenario for South Africa would be if the fight against corruption will be this new goal, but that is probably hope talking again….

But all in all, South Africa is a better place today than it was in February last year. Yes, it is off a very low base, but hopefully Ramaphosa can keep the trajectory on the right track. Let’s see what happens after the election.

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Exceptionally good article. Author addresses what is vital yet was simply concealed in the SONA. Budget Speech in 10 days time will talk numbers
(” South Africas wallet..”), really sorting Eskom out( facts not talk), so retrenchments, recapitalization etc and then what the author highlights-trust has been lost and is very hard to rebuild.

The Real elephant the room is the uncontrolled – and exponentially exploding – population growth of the poor.

Every single problem we have in SA derives from that single root cause.

Yet NOBODY wants to touch on this subject. Not any political party. No business leaders. And most curiously, not a SINGLE economist!

When the media start discussing this, then politicians will be forced to confront these issues, and THEN the logjam will break.

I’m curious, Ryk.

Why does the media – and Moneyweb in particular – go out of their way to AVOID ventilating this issue, and holding politicians’ and economists’ feet to the fire on this existential issue???

The population is growing at about 1 baby every 30 seconds

I do not think the facts support your argument. SA population growth rate is currently 1.3% – nog significantly ahead of developed countries. Fertility rate is 2.46 per woman (down from 2.9 in 2000, 3.7 in 1990 and 6.5 in 1960, 2.1 is required to keep a population stable (not 2 because not all women will have children.).

This rapid decline is due to increased urbanisation and improved education of women. There is a fantastic article in the latest Economist dealing with global population growth.

Notwarren:

Your generalised stats are hiding – not exposing – the problem!

Look at the trends in this graph of SA Population Growth, and you (anyone!) can immediately see where (who!) the problem is, and that this is a trend that is ACCELERATING.

https://goo.gl/images/FfyQQ7

South Africa’s population grows at around 1.2% a year. This is slightly higher than the world average of 1.07%. SA’s population is therefore not “exploding exponentially”.
I also believe there are many more pressing problems facing our country.

Agree. The fact that the rate is “only” slightly higher than developed countries is irrelevant. As Jonnoxx says it is still increasing. We need a reducing birth rate for many years to get rid of grants. It will also reduce crime as the currently unemployed are mostly (not all to be fair) unemployable. A daily shopping trip is usually a painful experience; in the retail customer facing area most currently “employed” would be unemployed anywhere outside South Africa.

Generally a good article by Ryk but disagree on the “hope” aspect. Rammerpozza has destroyed hope. We soon realized that Zoomer was an uneducated criminal but had hope the his successor would be the opposite. We got that. What we did not expect was a spineless bullduster who has committed more than any ANC cadre to the outright theft of property, has not rowed back unaffordable free tertiary education (The IMF agrees). Neither has this scary ANC type even tried to blunt the impact of a country destroying free medical. It cannot work other than through a short-term illusion – just ask the UK.

The arguments of having to hold the ANC together are at best marginal. SA needs a Trump type individual that will tell the truth fearlessly. To those “hopers” just how is Rammerpozza going to recant his current highly destructive story and get the ANC leadership and voters to still back him? Once a liar always a liar; once you have lost respect it is near impossible to recover this – ask Hansie Cronje.

I also hope but it is near gone. I hope that I will in 12 months time be able to offer a grovelling apology to Cyril.

To the more prisons comment. No, No, for crying in a bucket no, not 1 more prison. Where does the money come from? The death penalty comes back. Ag shame do not like that? Well then try hard labour for life.

I’m curious, Ryk…

You keep deleting my responses pointing out that the “stats” you and Notwarren mention are CONTRADICTED (and in a BIG way!) by the simple chart on SA population growth I had linked to.

Something is not gelling here with these conflicting stats!

I will be happy to accept a convincing explanation for this contradiction.

Perhaps another reader or statistician with more insight on these stats can help here.

But how will they know if you keep censoring questions you seem unable to defend against?

Have to say I agree with Jonnox. Ryk, you’re missing the point. Clearly deliberately as well.
Regardless of how our growth rate compares to the global norm our economy and growth rate need to be in balance.
I would think someone writing for moenyweb could grasp this fairly straight forward concept!

Did Dear Cyril say anything about the Rand generator of tourism and the associated one of the film industry? I didn’t hear him talk about this almost instant attraction of foreign exchange and employment creation.

I’ve been bleating on and on for years about how these industries (Disney is worth about a trillion Rands) are a win/win where our vast natural resources requiring no loans to get going are simply sitting there waiting for reasonably well-off foreigners to come and enjoy (without being murdered/raped or their possessions stolen).

Both of these would help fund air/rail transport the bushveld-style leisure industry (no game hunting though) and training in the hotel and restaurant trade.

It seems this needs too much imagination though …. much simpler to dig a hole in the ground and send the best labour down a kilometre or two for the day processing stuff that other countries produce faster and cheaper.

Sigh …

Rather than have the state making guesses about the future on behalf of us all, it should reduce its role to that of regulator and provider of last resort; from being a player to being referee with a safety net role.

Apart from the recent exposures of the unsurprising consequences of concentration of power, even with the best intentions, planners cannot be all-knowing and future trends are best left to the markets

On what he said I rated it 8/10. On the ANC / Government’s ability to execute even a fraction of this, 1.5/10. Love the ‘new’ Scorpions though!

It would appear that the pachyderms are running amok today. What is the real elephant? This is the fact the CR works for the ANC. CR embodies the ANC. The ANC, by any objective realistic measure, is a corrupt, criminal organisation that has been looting the country for a quarter of a century. CR is the head honcho of this organisation. Kan ons wolf skaapwager maak? Ek glo nie.

For me the biggest elephant is the fact that we have more than 20000 murders every year in this country – You can forget any tourism growth etc until this appalling situation is controlled. The first thing in Ramaphosa’s infrastructure spend should to be to building more high security prisons – enough to incarcerate 20000 murderers every year (should the SAPS ever manage to do their jobs that we pay them to do).

Spot on – talk is cheap, when we see the VBS and the BOSSASA “crews” are arrested by the Hawks and immediately put into prison rather than granted R20,000 bail we will know there is real change. Look at the Japanese and Carlos Goshn – that’s how you treat financial criminals.

You may argue that there should be a presumption of innocence – however the likes of Agrizzi have confessed in a public forum and the VBS investigations are clear evidence of theft.

Let’s stop the talk, get on and do something to rebuild the public’s faith.

Good article, Ryk.

I agree with Jonnox, it is my experience as well. Where are our top economists on population growth?

At Notwarren: Stats SA recently showed the population growth figures since 1994. The Indian and White Groups stayed roughly the same, the Coloured Group increased somewhat and the Black Group increased by 50%, from 30 million people to 45 m people now.

Yes the rate has come down but still millions of children’s lives are not planned and many parents have more children than they can afford. The parents of virtually every child on a school feeding scheme is guilty of that.

We want to create jobs but we only support black industrialists and black businesses. Yet you expect those same business being excluded to offer people job? The irony!!!

The prosecutions are being dragged out to only start after the election. The Zondo Commission also, so that the final report appears after the election.

Pres Ramaphosa is still putting the interests of the party before that of the country.

Like apartheid, Corruptheid cannot be reformed. It, and the implementing party, must go.

Other elephants are the Augean Stables of Cadre Deployment – nobody can clear that out – CR included.

Further, too many government employees and they are overpaid by a third (according to economist Mike Schussler). On a Government salary bill of R500 bn, a gradual cut of a third can bring a R150 bn saving, that can be used to implement CR’s plans and poverty relief.

At Ryk: Successful countries like China, Singapore, Japan and Germany have in common a drive for high economic growth and job creation – and low population growth.

With 40% unemployment, does help to increase the amount of people? Bringing down population growth is the flip side of job creation and has an exponential effect to improve lives.

Population growth has come down through Aids and urbanization.

However, in the poor communities millions of people have children that they cannot afford. Every child on a school feeding scheme shows that.

Family planning was declared as a human right in 1969. How many millions of children’s lives are not planned in this country?

The 15 million extra people created since 94 all need food, housing, education etc – putting scarce resources further under pressure.

I have yet to sit through a full SONA eulogy and hear anything which refers to the objective of a past promise where it has been fulfilled. These SONA diatribes have neither measurable outcomes or objectives met. This latest SONA reminds me of a very young and naïve CR sitting on Father Christmases knee at a run down shopping centre telling Santa all about his wish list – everybody know its wishful think – except to the kid

Good article Ryk. My worry, and trying not to be pessimistic, is how totally broke the system is. I am afraid when you are really realistic and see past the “saying what people want to hear” there’s just too many conundrums to deal with – the perfect storm where…. addressing any shortcoming (like ESCOM – which is just one) doing the right things, then the country is going to be faced with massive labour unrest (that will obviously be orchestrated by anti “doing right things crowd”). He is going to break up ESCOM but there is no way he will be able to trim anything. There will (my worry) now be 3 CEO’s and their teams (ie more fat cats) and nowhere he said we will also address incompetence (then he must acknowledge the ruling party failed the country) …same goes for SAA, SANRAL, etc ….and he did not touch on the fact that poor pensionars (PIC) cannot recover from the billions been wasted…ever..scary thought. We all know the correct formula but this beloved country at the moment, I fear, is way to devided by politics, innuendo, racist beings (all sides)..then it let me think of this quote:
“… before things can change..We must be willing to get rid of the life we’ve planned, so as to have the life that is waiting for us. The old skin has to be shed before the new one can come…”
Before he can fix (ESCOM as example) the not working parts, he must create private suppliers (new jobs), when he then tackles the issues of ESCOM and lost jobs there is need in private sector where job losses can be offset…and again when you think about the socialistic system that drives the votes…not an option..SCARY!! BUT LETS HOPE!

The unions are deeply concerned about the proposed break up of Eskom. Not are they concerned about possible low level major job losses but more worryingly that a few elite will benefit from the break up and sale of assets. We should all be concerned. Why is it that Jeff Radebe signed new renewable energy deals which cost us R 93 million per day but Eskom is left to flounder?? Eskom needs decent strong management and a zero tolerance for corruption. Many fat cats at Eskom.

” … corruption and the fact that many of those implicated happened to be sitting metres away from the podium”
And one was standing BEHIND the podium.

Acting, directly or via state agencies against internal opponents is part of the ANC tradition, including the Qattro and other “exile” repressions, with Ramaphoney diretly involved in the expulsion of Malema & friends and the author of the infamous Marikana email requesting police action against those whom he falsely accused of illegality.

So to rid SA of the corruption cANCer will require virtually total exenteration of the ANC cabinet, NEC and caucuses, all of whom were involved either actively in the industrial-scale plundering of the state or were part of its cover up.

One of the biggest barriers to growth and stability is education, Apart from the every-day corruption crippling education,there is the corruption of a special type — the capture of the ANC by SADTU the union protecting bad teachers at the expense of pupils, parents and the economy. Given the ANC’s dependence on its members to keep the lumpens unemployable and hence clients of the ANC-conflated-with-state, to campaign before elections and to be temp IEC staff to rig elections, this, too, is unlikely to change.

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