South African President calls for actions to restore economy

President Cyril Ramaphosa delivers his State of the Nation address at parliament in Cape Town, South Africa

In his State of the Nation Address on Thursday, Ramaphosa said that over the past year, South Africa has experienced a sharp decline in growth and a significant increase in unemployment.

The country’s GDP has shrunk 6 per cent between the third quarter of 2019 and that of 2020, while unemployment “now stands at a staggering 30.8 per cent”, with 1.7 million job losses last year, he noted.

The President said that the overriding priorities of 2021 are to defeat the pandemic, accelerate the country’s economic recovery, implement economic reforms and fight corruption.

“As a result of the relief measures that we implemented and the phased reopening of the economy, we expect to see a strong recovery in employment by the end of 2020,” he noted.

Ramaphosa said over 70 billion rands ($4 billion) in tax relief were extended to businesses in distress, while 18.9 billion rands ($1 billion dollars) in loans have been approved for 13,000 businesses through a Covid-19 loan-guarantee scheme.

The administration has also focused on such measures as rolling out massive infrastructure, localising production and boosting energy generation capacity, he said.

State-run, debt-ridden Eskom, the major electricity provider in the country, has been restructured to increase capacity and efficiency, according to the President.

As to agriculture, Ramaphosa said that the favourable weather conditions in 2020 and the beginning of 2021 mean that the sector is likely to grow in the near term.

Ramaphosa said South Africa will begin to harness the opportunities presented by the African Continental Free Trade Area (AfCFTA), which covers 54 of the 55 African Union members and came into operation on January 1.

“The AfCFTA provides a platform for the South African businesses to expand into markets across the continent, and for South Africa to position itself as a gateway to the continent,” he said.

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