South Africa’s economic and social challenges risk stagnation amid an unprecedented energy crisis and increasingly binding infrastructure and logistics bottleneck. The main threats to business activity in the country include power cuts, tightening financial conditions, and endemic public sector corruption which can spillover into private sector activities.  

Real GDP growth is projected to decelerate sharply to 0.1 percent in 2023 mainly due to a significant increase in the intensity of power cuts, as well as the weaker commodity prices and external environment. Far-reaching reforms are needed to achieve an inclusive, greener, and job-rich growth in South Africa. We are the country’s only solution to economic prosperity. 

Our party spent 8 months engaging members and supporters of ActionSA, industry experts, professionals and ordinary South Africans about the solutions needed to address the greatest challenges facing South Africa today.

We aim to create an environment that achieves the careful balance between allowing the private sector to grow, innovate and compete effectively in the global economy, while working towards the goal of creating a more just and equitable South African economy. Entrepreneurs are equally, if not more, important when the economy is doing badly. When unemployment is high and the economy is contracting or stagnating, dynamic entrepreneurship could help turn the economy around. 

The reality is that we do not have sufficient financial resources to address all the gaps in our economic infrastructure. It has been estimated that South Africa will have an infrastructure investment gap of 4.8 trillion South African rands by 2030 unless it increases its investment in infrastructure. 

This is particularly important to the socio-economic advancement of our nation. Insufficient and poor economic infrastructure management in the past two decades has limited our citizens’ access to markets, livelihood opportunities and services such as clean water, education, health, transport, and communication. 

We intend to reduce the bureaucratic red tape, procurement inefficiencies and corruption that enhances the value derived from public investments into economic infrastructure. Improving the investment environment that provides better returns for investors will attract local and international investors into public infrastructure projects. Catalytic project investments will bring opportunities to improve South Africa’s economic competitiveness and have positive socio-economic returns.

The country is dealing with rolling blackouts after years of mismanagement of the state-owned utility, Eskom. The ease of the registration process and licensing requirements for energy production that encourages private sector investment is long overdue; South Africa’s economy cannot operate at full efficiency without the stable supply of electricity. As ActionSA, we believe that stabilising the electricity grid through proper infrastructure upgrading, maintenance and expansion is the first step towards achieving energy security. 

Elevated levels of load-shedding in 2023 could cost the South African economy R1.6 trillion in lost economic activity – R400 billion more than last year. The impact on gross value added to the economy would be R725 billion, causing cataclysmic impacts on employment in South Africa. Job losses due to elevated load-shedding could amount to 860,000 in 2023. South Africa currently has the highest unemployment rate in the world at nearly 33%, with 75.1% of youth in the country out of the labour force. 

In 2021, a World Bank economic analysis for South Africa found that young entrepreneurs were one of the country’s best hopes of solving the jobs crisis, which had been worsened by the COVID-19 global pandemic in an environment of weakened economic growth. South Africa would have to address three chronic labour market challenges to generate employment: low levels of self-employment, high rates of unemployment, and extremely high rates of inactivity. 

As ActionSA, we will establish a labour law framework that increases access to gainful employment and inclusion. We plan to improve the productivity of South Africa’s labour force by decreasing the cost and effort of employing new people and ensure equitable access to opportunities between workers and owners of capital. Although we believe that labour unions are a valued stakeholder. We will, however, not allow unions to have a veto right over economic policy. The Labour Relations Act will be amended to reduce the political power of trade unions.

We will promote funding of entrepreneurial ventures by introducing low-interest, government-secured loans for SMMEs at private financial institutions. We will introduce targeted investment types that have reduced capital gains tax rates to enhance investment into SMMEs. Our goal is to achieve Market-driven government support mechanisms that unlock the potential of labour-intensive sectors. We want accelerated growth of sectors where South Africa has competitive advantage. 

The agricultural sector has the potential to create labour-intensive growth in rural areas, it is vital to ensuring food security in the face of climate change and produces by-products that can be utilised in the green economy. ActionSA advocates for increased participation of black farmers, increased employment in rural areas in the agricultural sector, and sustained food security in the face of climate change.

Ladies and gentlemen, South Africa’s delay in economic rebound is attributed to many factors amongst which, government inefficient economic policies that have been unable to reform our global competitiveness. South Africa's overall and factor competitiveness rankings among the 63 countries surveyed in 2022, ranked 60th, an improvement of 2 positions from 62nd in 2021. The dismal ranking is attributed to rising public debt levels amid a shrinking fiscal space, ongoing electricity supply and rolling blackouts as well as the lack of decisive plans to revive the struggling economy.

Addressing structural barriers to South African economic competitiveness and decreasing the cost of doing business in South Africa will catalyse access to economic prosperity. Competing and winning in the global economy requires that South African firms produce better products at better prices than their international competitors, which can be achieved by supporting innovation, improving productivity, and focusing on competitive advantages. 

We are ready to create an enabling environment required for economic competitiveness by reducing the barriers to innovation and growth, and improving collaboration between the public sector, labour organisations, industry bodies and individual firms. Ladies and gentlemen, we advocate for increased investment in entrepreneurial skills and innovative thinking that will allow South Africa’s SMME-sector to improve its economic contribution.

A strong and sustained economic growth emanating from trade and investment is needed to confront the challenges of unemployment and poverty. The mining sector is not performing as well as it used to, in South Africa. Local factors such as union militancy, rising production costs, and unreliable transport and energy infrastructure remain downside risks impacting South Africa’s extractive sector. 

The growth of our economy is contingent upon the unhindered flow of goods and services across our borders and significant inflows of foreign direct investment. Ladies and gentlemen, our status as an investment destination relies on our performance in all other areas of economic prosperity; Investment is required to improve our performance in areas of infrastructure, sectoral development, competitiveness, employment, and the urban and rural economy. International trade requires that we be competitive on the international stage, it is driven by the efficiency of our trade infrastructure and the productivity of our labour force. We vow to reform legislation, regulations and policies that constrain trade and FDI in its first year in government.

Ladies and gentlemen, the informal economy plays a significant role in urban economies; it empowers individuals to generate income to sustain their households, it creates jobs and provides access to good and services where people live. We as ActionSA want to turn around the current approach from a system that is punitive and seeks to formalise the economy to one that empowers individuals to start micro-enterprises. 

I want to leave you with the thoughts that rather than amending the Constitution and expropriating privately-owned land and property without compensation- ActionSA believes that land reform can be accelerated by expropriating abandoned and hijacked buildings and repurposing state-owned land property in economically strategic areas. Expropriating and conditionally releasing such properties to private sector developers, affordable mixed-used buildings can provide access to economic prosperity.

Ladies and gentlemen, policy plans are useless without effective implementation. For too long, South Africa has been rich with policy, but poor with implementation. We must, without hesitation, capacitate the institutions responsible for policy implementation with competent people rather than making politically expedient appointments.